A hard reality is fueling the public's economic anxiety: One in three Americans have sustained a job loss or pay cut within their own household, and far more – three-quarters of the public – say it's happened, if not at home, then to a close friend or family member.
Those experiences are rippling through the economy, this ABC News/Washington Post poll shows, heightening stress, sapping confidence and encouraging spending cuts – all in turn, as President Obama said Tuesday, exacerbating the very problem that caused them.
Anxiety focuses on employment and income. Nearly half of Americans, 46 percent, are worried that someone in their household will lose their job in the next few months. Even more, 52 percent, are concerned about a cut in pay or work hours.
Given those fears, 67 percent say they're cutting back on their spending, with 31 percent cutting back "sharply" – an enormous contraction in the economy's lifeblood. Nearly half are concerned about being able to make their rent or mortgage payments, up 9 points since December. And fewer than half are confident in their resources for retirement; nearly one in four, not confident at all.
All told, 64 percent say they've been hurt financially by this recession. And 57 percent report personal stress as a result – more than one in four, "serious" stress.
LAYOFFS/PAY CUTS – All these concerns are influenced by the experience of layoffs and pay cuts – and those are broad. Nearly two in 10 Americans say someone in their household has lost a job in the last few months. One in four reports cuts in pay or work hours within their household; the combined total for either pay cuts or layoffs is 33 percent. And seven in 10 say these have happened to friends or family.
The net total is impressive: Seventy-five percent of Americans either have had a job or pay cut in their own household, or have had it happen to a close friend or family member. Just a quarter are unscathed in this most fundamental sense.
It matters. Among that quarter of Americans who've not experienced these factors, 79 percent feel financially secure. That drops to 50 percent of those who've had friends or family hit, to 37 percent of those who've had a pay cut in their own household – and to just 29 percent of those who've sustained a job loss within the home.
As these factors fuel insecurity, so does insecurity encourage cutbacks. Even among Americans who feel secure financially, 55 percent are trimming their spending (a problem in itself) – but just 15 percent are cutting back sharply. Among financially insecure Americans, by contrast, 81 percent are cutting back – 51 percent, sharply.
SECURE? – It could be worse: All told, 57 percent still feel secure financially. But that's down 8 points since September, and it leaves a very substantial share of the population, 43 percent, bereft of a key element of the American dream. Moreover, a mere 12 percent now feel "very" secure, down from 21 percent as recently as last summer.
The drop in financial security has been most pronounced in a few, telling groups. This poll finds an 18-point drop since last fall in financial security among Americans ages 50 to 64 – those contemplating retirement, and likely shaking their heads at their year-end 401(k) statements. In September, 67 percent in this age group felt financially secure; today, it's 49 percent.