Sept. 15, 2009 -- It's hardly party time on the anniversary of world financial meltdown: Public ratings of current economic conditions have racked up their worst 12-month stretch on record, and expectations for the future worsened this month after what'd been a bounce for the better.
Forty-three percent of Americans now say the economy is getting worse, up 12 points from last month to the most since April. That's far better than the record 82 percent pessimism last October, a month after Lehman Brothers collapsed. But it's hardly good: Just 24 percent now see the economy as getting better, 9 points below its recent peak last spring.
Current economic sentiment is no better off: The ABC News Consumer Comfort Index stands at -49 on its scale of +100 to -100, down 4 points in two weeks and inching closer to its record low, -54 in January, after improving through the summer. The CCI was bad enough a year ago this week, -41. Since then it's averaged -48, its lowest 12-month stretch on record in weekly polls since late 1985. Its long-term average is -12.
These sentiments contrast Fed Chairman Ben Bernanke's statement today that the recession is "very likely over"; unemployment at 9.7 percent, the highest mark in 26 years, may make it hard for consumers to see a light at the end of the recessionary tunnel. Bernanke said as much: "It's still going to feel like a very weak economy for some time, as many people still find that their job security and their employment status is not what they wish it was."
Indeed a separate ABC News/Washington Post poll released today reinforces that reality, finding significant levels of employment pain at the household level: Forty-seven percent of Americans report job loss or pay cut in their household in the past year. About as many worry about that happening in the months ahead. And many express skepticism that either the federal government or the financial industry are taking steps to help prevent another crisis.
CURRENT INDEX – The CCI is based on Americans' ratings of the national economy, their personal finances and the buying climate. Fewer than half, 44 percent, rate their own finances positively, 13 points below the long-term average. While it's up from the record low of 39 percent in late June, fewer than a majority have rated their finances positively for 18 weeks straight and all but two weeks this year.
Far fewer, 24 percent, say it's a good time to buy things, 13 points below the long-term average and below 30 percent for a record 79 weeks. And only 9 percent rate the national economy positively, in single digits for 46 of the last 49 weeks and 29 points below average.
BETTER/WORSE – As noted, in a forward-looking measure of expectations, 43 percent say the economy is getting worse. While that's similar to the long-term average in polls dating to 1981, the 12-point increase from August is the first time expectations have worsened in three months.
Partisanship informs these judgments to some extent: Republicans and independents are more pessimistic, 53 and 47 percent respectively, vs. 30 percent of Democrats.
TREND – After crawling up 8 points through the summer to -45 in late August, the index has slumped back to the edge of the grim -50 mark. Staying short of that line is no small feat of late; the index's current run of eight weeks above -50 is its second best streak since last summer.
Still, it's been below -40 for 73 consecutive weeks, a record, and hasn't seen positive territory since March 2007. The CCI's average so far this year is -49, 5 points below the worst annual average on record, -44 in 1992.
Its best yearlong average was +29 in 2000; its best week, +38 in January 2000.
GROUPS – The index is higher as usual among better-off Americans, but negative across the board for the 29th week straight and all but two weeks this year.
It's -17 among those with the highest incomes while -77 among those with the lowest, -35 among those who've attended college vs. -80 among high school dropouts (also a new low), -44 among men (matching the worst since June) while -51 among women, -43 among homeowners compared with -58 among renters, and -48 among whites vs. -52 among blacks. The last is far different from the usual 28-point racial gap.
Partisan differences remain, with the CCI at -39 among Republicans (3 points from the low), compared with -44 among independents and -62 among Democrats (the worst since February). But the Republican-Democratic gap has been narrower than usual this year, averaging 20 points compared with 41 points last year and 32 points long-term.
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Nine percent of Americans rate the economy as excellent or good; it was 8 percent last week. The highest was 80 percent Jan. 16, 2000. The worst was 4 percent Feb. 8, 2009.
PERSONAL FINANCES – Forty-four percent say their own finances are excellent or good; it was 45 percent last week. The best was 70 percent, last reached in January 2000. The worst was 39 percent June 28 and 21, 2009.
BUYING CLIMATE – Twenty-four percent say it's an excellent or good time to buy things; it was 25 percent last week. The best was 57 percent on Jan. 16, 2000. The worst was 18 percent, last reached Oct. 19, 2008.
METHODOLOGY – Interviews for the ABC News Consumer Comfort Index are reported in a four-week rolling average. This week's results are based on telephone interviews among a random national sample of 1,000 adults in the four weeks ending Sept. 13, 2009. The results have a 3-point error margin. The expectations question was asked of 500 respondents Sept. 2-13, 2009; that result has a 4.5-point error margin. Field work by ICR-International Communications Research of Media, Pa.
The index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are added and divided by three. The index can range from +100 (everyone positive on all three measures) to -100 (all negative on all three measures). The survey began in December 1985.
ERRATA – A software problem at ICR created errors in crosstabulated results by income group and marital status in data Aug. 30 to Oct. 18. The CCI overall and in other crosstabulations was not affected. This report has been updated with corrected results by income group and marital status.