POLL: Confidence Drops Sharply;
Optimism Matches its Worst
Harried by rising gas prices, consumer confidence slid to a 14-year low.
April 15, 2008 — -- Harried by rising gas prices, consumer confidence slid to a 14-year low today while economic expectations continued to flounder at their worst in 17 years.
The ABC News Consumer Comfort Index sustained an unusual 5-point drop this week to -39 on its scale of +100 to -100, its lowest since October 1993. Views of the national economy are their worst in 14 years; ratings of personal finances dropped significantly.
Click here for PDF with charts and data table.
In a separate monthly measure, only 3 percent say the economy is improving, same as last month at the record low set during the 1990-91 recession. Though optimism can't get much worse, pessimism has: Seventy-three percent say the economy is getting worse, up from 68 percent last month and very close to the record, 77 percent in late 1990.
It's hardly unexpected. On top of the housing and credit crises, retail gas prices climbed 6 cents to $3.39 last week, up 51 cents in the last year to their highest levels in more than 27 years. In a separate ABC News/Washington Post poll this week, a near-record 67 percent of Americans say the price of gasoline is causing financial hardship for them or their families. Nearly four in 10 (38 percent) report serious hardship.
INDEX – The ABC News CCI is based on Americans' ratings of their current finances, the national economy and the buying climate. Only 15 percent rate the national economy positively, the fewest since October 1993. Positive ratings of the national economy are 7 points below their 2008 average, 22 percent, and 25 points below the long-term average, 40 percent in weekly polls since late 1985.
Twenty-four percent rate the buying climate positively, down 7 points this year and 14 points off the long-term average, 38 percent.
Traditionally the strongest of the three measures, positive ratings of personal finances dropped 4 points this week to 53 percent, tying the 2008 average and 4 points below the long-term average, 57 percent.
EXPECTATIONS – As noted, 73 percent think the economy's getting worse, 5 points more than last month and the most since November 1990. Negative expectations have been above 60 percent for six months straight, a record in ABC News polls since 1981.
Levels of optimism are equally alarming: For the second consecutive month only 3 percent think the economy's getting better, the first time it's been this low for two straight months.
TREND – At -39, the CCI is lower than its low average of -31 for 2008, and further below its long-term average of -10. After a sustained slide early in the year, the index has remained mired at or below -30 for 11 straight weeks.
After its worst quarter since 1993, the index is much closer to its record low, -50 in February 1992, than to its all-time high, +38 in January 2000.
GROUPS – The CCI as usual is higher in better-off groups, though the index is negative across the board. It's -5 among higher-income people (down 17 points in the last week), while -73 among those with the lowest incomes. It's -29 among those who've been to college while -45 among high-school dropouts, -37 among whites but -57 among blacks and -32 among men while -44 among women.
Partisan differences remain: The index is -10 among Republicans, but -38 among independents and -51 among Democrats.
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Fifteen percent of Americans rate the economy as excellent or good; it was 17 percent last week. The highest was 80 percent on Jan. 16, 2000. The lowest was 7 percent in late 1991 and early 1992.
PERSONAL FINANCES – Fifty-three percent say their own finances are excellent or good; it was 57 percent last week. The best was 70 percent, last reached in January 2000. The worst was 42 percent on March 14, 1993.
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, 20 percent in fall 1990.
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 April 13, 2008. The results have a three-point error margin. The expectations question was asked of 500 respondents April 4-13, 2008; 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.