Public Less Positive About Direction of Economy

by David W. Moore

Ratings of current situation unchanged

GALLUP NEWS SERVICE

PRINCETON, NJ -- The public's ratings of the economy remain unchanged from last month, but expectations about the future have fallen, according to Gallup's February update on Americans' economic attitudes. The decline in expectations appears to be related to less optimistic views about the direction of the stock market; predictions of economic growth and unemployment remain essentially unchanged this month.

The poll, conducted Feb. 4-6, finds that 28% of Americans rate the current economy as excellent or good, while 16% give it a "poor" rating. Another 55% say "only fair." These results are virtually identical to those obtained last month, and show little substantial change since November.

Ratings of Current Economic Conditions

While the public's rating of current economic conditions has not changed since last month, the public has become less positive about where it thinks the economy is going. Almost half of Americans, 47%, say economic conditions are getting worse, and just 41% say better. In January, Americans' expectations showed the reverse, with 49% predicting better times and 41% predicting worse times -- the first time Gallup had measured a net positive feeling on this question since November 2000. The current rating suggests that Americans have become more skeptical about the chances of a quick economic recovery than they have been over the last several months.

Economic Conditions: Getting Better or Getting Worse?

One possible reason for this decline may be the negative performance of the stock market in recent weeks. Indeed, the poll shows that Americans' predictions about the stock market are less positive this month than they were last. Overall, 43% expect that six months from now, the stock market will be higher, while 28% say lower. Last month, Americans were more optimistic, with 53% saying it would be higher and only 19% lower.

Stock Market: Go Up, Go Down or Remain the Same in the Next Six Months?

While Americans are much less positive today about the stock market than they were last month, they appear only slightly less positive about economic growth. As the following chart shows, today 51% of Americans predict economic growth to increase over the next six months, and 24% expect it to decrease. In January, 53% said they expected an increase, while 20% expected a decline -- only slightly better than what was measured this month.

Economic Growth: Go Up, Go Down or Remain the Same in the Next Six Months?

On the issue of unemployment, Americans appear to be slightly more optimistic this month than last. While more people still expect unemployment to increase rather than decrease over the next six months, the margin in favor of an increase is smaller this month than last. Today, 43% expect an increase and 39% a decline, compared with a 46% to 35% ratio measured in January.

Unemployment: Go Up, Go Down or Remain the Same in the Next Six Months?

The fact that perceptions of the stock market's direction have become more negative this month, while views on economic growth and unemployment have not, suggests that the stock market may be a factor in the overall more negative perceptions of the economy's direction picked up in the February poll. At the same time, it is possible that the impact of the Enron scandal -- which has dominated the news over the last several weeks -- may be having an effect. Many analysts suggest that Enron may be a major cause of the drop in the stock market, as investors wait on the sidelines in anticipation that other Enron-type situations may come to light in other companies. Additionally, it is certainly possible that Enron has had a direct effect on the type of consumer perceptions measured here, with the extensive coverage of the scandal creating a more negative economic mood than would otherwise have been the case.

Survey Methods

Results are based on telephone interviews with -- 1,011 -- national adults, aged 18+, conducted Feb. 4-6, 2002. For results based on the total sample of national adults, one can say with 95% confidence that the margin of sampling error is +/- 3 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

How would you rate economic conditions in this country today -- as excellent, good, only fair, or poor?

 

 


Excel-lent



Good


Only
fair



Poor

No
opin-
ion

%

%

%

%

%

2002

2002 Feb 4-6

2

26

55

16

1

2002 Jan 7-9

2

27

54

16

1

2001

2001 Dec 6-9

2

29

53

16

*

2001 Nov 8-11

2

29

50

19

*

2001 Oct 11-14

2

36

48

13

1

2001 Sep 14-15

3

43

44

9

1

2001 Sep 7-10

2

30

49

19

*

2001 Aug 16-19

2

34

49

14

1

2001 Jul 19-22

3

38

47

11

1

2001 Jun 11-17

3

39

45

12

1

2001 May 10-14

3

37

45

15

*

2001 Apr 6-8

4

41

41

14

*

2001 Mar 5-7

3

43

43

10

1

2001 Feb 1-4

7

44

36

13

*

2001 Jan 10-14

11

56

27

6

*

2000

2000 Dec 2-4

12

51

28

8

1

2000 Nov 13-15

19

53

21

7

*

2000 Oct 6-9

14

57

24

4

1

2000 Aug 18-19

25

49

21

4

1

2000 Jul 25-26

26

48

21

4

1

2000 May 18-21

17

49

24

9

1

2000 Apr 3-9

14

46

30

9

1

2000 Jan 7-10

19

52

23

5

1

* Less than 0.5%



Right now, do you think that economic conditions in the country as a whole are getting better or getting worse?

 

 

Getting
better

Getting
worse

SAME
(vol.)

No opinion

%

%

%

%

2002

2002 Feb 4-6

41

47

10

2

2002 Jan 7-9

49

41

8

2

2001

2001 Dec 6-9

44

48

6

2

2001 Nov 8-11

30

59

7

4

2001 Oct 11-14

33

55

10

2

2001 Sep 14-15

28

60

8

4

2001 Sep 7-10

19

70

9

2

2001 Aug 16-19

27

59

11

3

2001 Jul 19-22

35

53

9

3

2001 Jun 11-17

29

60

8

3

2001 May 10-14

25

63

9

3

2001 Apr 6-8

24

63

9

4

2001 Mar 5-7

28

61

7

4

2001 Feb 1-4

23

66

8

3

2001 Jan 10-14

32

56

8

4

2000

2000 Dec 2-4

39

48

8

5

2000 Nov 13-15

50

38

9

3

2000 Oct 6-9

54

34

10

2

2000 Aug 18-19

60

26

10

4

2000 Jul 25-26

58

29

9

4

2000 May 18-21

52

37

9

2

2000 Jan 7-10

69

23

6

2

(vol.) Volunteered response



Over the next six months, do you think that each of the following will -- [ROTATED: go up a lot, go up a little, remain the same, go down a little, (or) go down a lot]? How about -- [RANDOM ORDER]?

A. The Stock Market

 

 


Go up
a lot


Go up
a little


Remain same

Go down
a little

Go down
a lot


No
opinion


Total
UP


Total DOWN

 

%

%

%

%

%

%

%

%

                 

2002 Feb 4-6

7

36

23

20

8

6

43

28

                 

2002 Jan 7-9

9

44

22

15

4

6

53

19

2001 Dec 6-9

9

42

21

17

6

5

51

23

2001 Nov 8-11

8

34

23

22

8

5

42

30

2001 Oct 11-14

10

36

19

22

8

5

46

30



B. Economic Growth

 

 


Go up
a lot


Go up
a little


Remain same

Go down
a little

Go down
a lot


No
opinion


Total
UP


Total DOWN

 

%

%

%

%

%

%

%

%

                 

2002 Feb 4-6

7

44

23

18

6

2

51

24

                 

2002 Jan 7-9

6

47

25

15

5

2

53

20

2001 Dec 6-9

8

41

25

18

5

3

49

23

2001 Nov 8-11

6

33

26

26

6

3

39

32

2001 Oct 11-14

6

31

29

24

8

2

37

32



C. Unemployment

 

 


Go up
a lot


Go up
a little


Remain same

Go down
a little

Go down
a lot


No
opinion


Total
UP


Total DOWN

 

%

%

%

%

%

%

%

%

                 

2002 Feb 4-6

12

31

17

29

10

1

43

39

                 

2002 Jan 7-9

16

30

18

26

9

1

46

35

2001 Dec 6-9

18

30

17

24

10

1

48

34

2001 Nov 8-11

21

31

13

23

11

1

52

34

2001 Oct 11-14

20

31

15

20

13

1

51

33



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