Posted by Leger ● Oct 15, 2023 9:54:32 AM
Not so long ago, we all wondered what the post-pandemic era would look like: let’s say that the picture may differ from what we imagined. The past few months have been challenging in many ways.
While facing many changes, the U.S. population must now deal with a whole new economic context that brings its fair share of worries, considering the increased cost of living due to high inflation.
According to the Associated Press, inflation reached highs not seen in four decades last year—prompting the Fed to raise interest rates aggressively—and it seems like they’re not about to drop anytime soon since the wholesale prices rose in September at the fastest pace since April.
Our economic confidence survey explores U.S. consumers’ major concerns by measuring their current and future confidence in the American economy and their household finances.
U.S. consumers are pessimistic about the state of the U.S. economy
U.S. consumers have a lot on their minds, but they are primarily worried about the impact that the national economy and inflation could have on their lives. When it comes to the state of the U.S. economy, their outlook is pessimistic.
- 57% of U.S. consumers think the economic conditions in the U.S. are poor, and 39% expect the economy to decline over the next six months.
- U.S. consumers are less pessimistic about their state economy: nearly half (46%) think their state’s economy is good, although 45% think it is poor.
- 52% consider inflation the top national issue, followed distantly by immigration (26%) and gun violence (22%).
While inflation is set to be the main preoccupation, other concerns were expressed in the survey, such as housing affordability.
U.S. consumers are concerned about what the economic future holds for them
Considering the recent economic uncertainty, consumers are also worried about the impact and effects of high inflation on their personal lives. More specifically, they are worried about their savings, bills, and investments.
In the past couple of months:
- 58% have worried about the safety of their savings
- 54% have worried about being able to pay their bills
- 51% have worried about the value of their investments
- 43% have worried about having to carry a balance on a credit card
U.S. CONSUMERS HAVE MORE CONFIDENCE IN THEIR CURRENT PERSONAL FINANCES
While the general sentiment on the national economy and inflation remains pessimistic, 63% of U.S. consumers describe their current household finances as good or very good.
Also, despite their concerns about the future state of the U.S. economy and their state economies, the picture also gets a little brighter when they think about the future, with 72% expecting their household finances to remain the same or improve.
Furthermore, 54% think that their discretionary spending will be about the same over the next 6 months. However, a few sectors may be hit harder than others when it comes to consumers’ predicted discretionary spending. Compared to the past 6 months, over the next 6 months:
- Discretionary spending on dining/takeout/delivery is expected to decrease by a net 9%*.
- Discretionary spending on household items and clothing/footwear/accessories is expected to decrease by a net 7%*.
* The net reflects the percentage of those who expect their discretionary spending to be higher, minus the proportion who expect their discretionary spending to be lower.
In the coming months, it will be crucial for companies to connect with U.S. consumers on a deeper level to understand what is most important to them and ensure their businesses can continue to be profitable in these difficult economic times.
Understanding the state of the U.S. economy will help you make more informed decisions
Our economic confidence survey reveals essential insights about how U.S. consumers perceive the economy and how their discretionary spending is changing over time.
We also offer custom research solutions that can help you innovate and plan for the coming months based on the new economic reality.