Recession's Toll Is Written in Cutbacks, Layoffs and Worry
Some of the worst numbers in decades show a nation insecure in its future.
Dec. 17, 2008— -- Across the country's kitchen tables, this recession is written in cutbacks, layoffs -- and pure worry.
Job insecurity is at its worst in 33 years of polls; holiday spending plans, their worst in data back 23 years. Americans report cuts in work hours and pay, and concerns about making the rent or mortgage, heating the house, paying for retirement. In all, it's an extraordinary loss of confidence -- with repercussions in families across economic and political lines.
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Sixty-three percent in this ABC News/Washington Post poll now think the country is in a "long-term economic decline," up from 49 percent 10 months ago; just a third say the economic system is still "basically pretty solid." And while economic distress tends to be greatest among lower-income Americans, the biggest increase in views of a long-term decline has been among the better-off, who have been hammered by the stock market.
HURT FINANCIALLY
An identical 63 percent say they themselves have been hurt financially by this recession, 10 points higher than the damage in the recession of 1990-91. Three in 10 say they've been hurt "a great deal," double what it was just after that recession 17 years ago.
Two-thirds of Americans are worried about maintaining their standard of living, up from 51 percent a year ago -- nearly a 30 percent increase. One in four is "very" worried. On this, as in several measures, there's an economic gender gap: Seventy-four percent of women are worried about maintaining their living standard, vs. 57 percent of men.
For many, these worries are more than theoretical: Twenty-seven percent -- more than one in four -- say they or someone in their household have had their pay or work hours cut in the last few months. Eighteen percent, nearly one in five, say someone in their household has lost a job lately.
Far more, 51 percent, say they've been hurt in the stock market rout -- up from 43 percent just two months ago and more than half for the first time in ABC/Post polls dating to 1987. That soars to two-thirds of higher-income adults, who are more apt to have stock investments.
And less than half of Americans, 46 percent, are confident they'll have enough money to retire, down from a high of 69 percent three years ago. Just 15 percent are now "very" confident they'll have sufficient retirement income.
INSECURITY: JOBS AND MORE
Some have more immediate worries. Among people who are currently employed, 21 percent -- one in five -- are worried about getting laid off -- nearly double what it was a year ago, and the most in polls dating back to 1975.
If they were to get laid off, moreover, nearly half, 47 percent, think it's unlikely they could find another job as good -- the most in polls back seven years. Of the rest, just 22 percent call it "very" likely they could get another job as good as the one they have now. That uncertainty peaks among older workers and people in union households.
But insecurity extends beyond employment. Examples:
Fifty-three percent are concerned about being able to afford health care for themselves or a family member; a third are "very" worried. Concern jumps to 59 percent among women, compared with 46 percent of men. And it rises to 75 percent among lower-income Americans; a majority in this group is very worried.
Nearly four in 10 Americans, 36 percent, are concerned about being able to heat their homes this winter -- 28 percent of men, but 44 percent of women, and soaring to 68 percent of the lowest-income Americans.
Fifteen percent -- one in seven -- have fallen behind on rent or mortgage payments in the past year, nearly double what it was in the teeth of the 1990-91 recession. Looking ahead, many more -- nearly four in 10 (37 percent) -- are worried about being able to keep up with future rent or mortgage payments.
That concern is 10 points higher among women than men (42 vs. 32 percent), higher among younger adults (46 percent of those under age 40) and especially high among low-income Americans: Fifty-five percent of those with incomes under $35,000 are worried about keeping up with their basic housing costs.
XMAS and BEYOND
Given these stresses, Christmas spending plans have weakened further, to their worst in polling since 1985. Fifty-seven percent of Americans now say they'll spend less on holiday gifts this year than last. The closest in any previous year was 51 percent in 1991, when holiday sales were their worst in a generation.
Separately, the weekly ABC News Consumer Comfort Index is in the midst of its worst stretch since it began 23 years ago: Just 7 percent of Americans say the economy's in good shape, 22 percent call it a good time to spend money and fewer than half, 44 percent, rate their personal finances positively.
There are signs, moreover, of potentially deeper problems ahead. Many of these measures are dramatically worse among members of households in which someone's lost a job or had their pay or work hours cut -- indicating that further contraction in employment or incomes would have a strongly negative effect on consumer attitudes.
People who report a layoff in their household, for instance, are nearly 30 points more likely than other Americans to say they're cutting back on holiday spending -- 81 percent vs. 52 percent. They're nearly 30 points more apt to be "very worried" about maintaining their standard of living and 35 points more likely to be "very concerned" about paying for health care. And 41 percent in this group report falling behind on their rent or mortgage payments. That compares with just 9 percent of those who haven't been hit by a job loss.
POLICY and POLITICS
Barack Obama's election hasn't changed the basic dynamic; 82 percent still say the country is "seriously off on the wrong track," eight points shy of the record level in mid-October but still an astonishing number.
Asked the single biggest problem for Obama and the Congress to address, 66 percent cite economic issues -- a huge level of agreement on an open-ended question. And while 55 percent say Obama's off to a good start on the economy, for the first time in ABC/Post polling, just over half don't think there's much he can do to improve it.
Obama does shine in comparison to George W. Bush: Just 24 percent approve of his handling of the economy; likewise, just 23 percent approve of the overall federal response to the economic situation. And 69 percent don't think the government has put in place adequate controls on how economic recovery money is being spent.
Looking ahead, two-thirds support a huge economic stimulus of construction projects and other programs, as Obama has proposed. But support weakens considerably -- to about an even split -- if it'll add to the federal budget deficit. And there's doubt here, too, that sufficient spending controls will be put in place to avoid waste and fraud -- suggesting the path to recovery, like the recession itself, could be an especially bumpy road.
METHODOLOGY -- This ABC News/Washington Post poll was conducted by telephone Dec. 11-14, 2008, among a random national sample of 1,003 adults, including landline and cell-only respondents. Results for the full sample have a 3-point error margin; click here for a detailed description of sampling error. Sampling, data collection and tabulation by TNS of Horsham, PA.