Recent Gallup polls show that Three Years After Crisis, Little Sign of Economic Relief in U.S.
- There has been no improvement in underemployment (counting part-time workers) from a year ago
- Job creation has been in a narrow range since October 2010
- Consumer spending has been stagnant since January 2009
- Economic confidence is near the lows seen at the depth of the depression
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Economic Confidence: Back at Recessionary Levels
Americans’ confidence in the U.S. economy is now at its lowest point since February 2009 — near the conclusion of the recession that officially ended in June 2009. Gallup’s Economic Confidence Index was -52 in August, above its financial crisis lows, but much lower than the -21 to -35 range measured from June 2009 to June 2011.
Americans’ current level of economic confidence — which represents their views on the current state and future direction of the nation’s economy — is decidedly negative. Seventy-seven percent said the economy was getting worse in August, the highest — by far — since February 2009, the month in which Congress passed a $787 billion stimulus bill in hopes of lifting the U.S. economy out the depths of the recession.
Job Creation: Improved From 2009-2010 Lows, but Far From Early 2008 Levels
The +13 Job Creation Index for August falls into the +10 to +15 range Gallup has measured since October 2010. The good news is that for nearly a year, Gallup has found consistently higher rates of net new job creation (the difference between hiring and letting go) than it did for the first two years after the global economic collapse. The not-so-good news is that the current rate of job creation is still just half of the +26 score Gallup found when it began tracking this metric in January 2008, when the nation was already technically in a recession.
Currently, 32% of workers say their employer is hiring and 19% say their employer is letting workers go, compared with 40% and 14%, respectively, in January 2008.
Underemployment and Employment: Stuck at Year-Ago Levels
Gallup found 18.5% of workers underemployed, including 9.1% unemployed, in August 2011. These figures are based on Gallup’s measure of employment, which is not seasonally adjusted. Both of the current figures are statistically similar to what they were a year ago, meaning the employment situation in the U.S. is no better now than it was at that time.
Consumer Spending: Nowhere Near 2008 Levels
Americans’ spending has remained essentially stagnant since it fell dramatically in January 2009. Spending in stores, restaurants, gas stations, and online has averaged $66 per day so far in 2011 — similar to the $65 is 2010 and $64 in 2009. This compares with an average of $96 per day in 2008. That year, Americans’ daily spending ranged from $81 to $114 per day in monthly averages. Since 2009, monthly spending averages have ranged between $58 and $75.
No Real Recovery
Clearly there has been no real recovery from the point of view of consumers. There was a financial recovery that is now crumbling, led by bank stocks.
BAC Bank of America
$BKX Banking Index
Banks Stock fueled the decline in 2008 and have done so this year as well. There was never a recovery in the real economy and now bank stocks signal the financial recovery is over as well.
Mike “Mish” Shedlock
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