Americans are feeling the financial strain from the past year, with a majority of lower-income individuals saying their situation has deteriorated in the last 12 months, according to a new poll from Gallup. The survey, conducted from Jan. 2 to Jan. 22, 2021, found that 61% of lower-income Americans reported that their financial situation had worsened over the past year, while only 26% reported that it had improved. Middle and upper-income Americans were more likely to say that they were worse off than better off, although the difference was not as significant as it was among the lower-income group.
In 2021 and 2022, the results of a survey showed that Americans were divided in their opinion of whether they were better off or worse off, with 41% reporting each. The poll also found just 35 percent of Americans said they were better off than a year ago. At 50%, the percentage of those who are worse off is the highest since Gallup first asked the question in 1976, apart from the time following the 2008 financial crisis.
Despite the economic hardship, Americans remain optimistic about their financial future, with 60 percent expecting to be better off in the next year and 28 percent predicting to be worse off. This positive outlook is in line with past trends, as Americans have been optimistic about their financial future in all such Gallup surveys since 1977.
The record-high 48% plurality of U.S. adults now predict the stock market will fall in the first half of 2023; 18% expect that it will remain the same, while 31% say it will go up. This is the highest level of pessimism ever recorded in a Gallup poll. Republicans have been more gloomy than Democrats about the economy since last year, with a 90% of Republicans describing the economy overall as “poor,” compared to 59% of Democrats.
The high inflation rate, interest rate increases, and poor stock market performance in late 2022, combined with significant layoffs at tech companies, have likely caused Americans to be pessimistic about the economic state of the US for the first half of 2023. At the beginning of 2023, the public is expecting economic conditions to deteriorate, even though the stock market had a strong start to the year, inflation appears to be easing, economic growth surpassed expectations in late 2022, and unemployment remains low.
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