The ABCNEWS/Money Consumer Comfort Index stands at +7 on its scale of -100 to +100. Last week it was at +5, down two points from the preceding week.
(ABCNEWS.com)
Key Rating at 4-Year Low
Poll: Economy in Bad Shape
By Dalia Sussman
N E W Y O R K, Aug. 15
— Public ratings of the national economy fell below an important benchmark this week: when a majority of Americans said it was in bad shape.
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It's the first time in more four years that ratings of the economy have been so negative.
Fifty-one percent now call the economy "not so good" or "poor," the first time since May 1997 that a majority of Americans felt that way. Americans' rating of the economy has been in a steep decline — positive ratings of the economy have declined by 22 points this year and by 31 points since January 2000.
Optimism about the future is also in short supply: Forty-six percent say the economy is getting worse, about the average all this year. Just 16 percent think it's improving. (On the other hand, in 1990 a record 77 percent said the economy was worsening.)
These views are balanced, moreover, by stable prices and higher incomes. Forty-five percent say it's a good time to buy things — up four points this week and the most since March (lower fuel prices may be helping). And 66 percent say their own finances are in good shape, just four points off the record high in more than 15 years of the weekly ABCNEWS/Money magazine poll.
Positive Ratings of the Economy
8/12/01
1/7/01
Record high
15-year average
National Economy
49%
71%
80%
42%
Buying Climate
45%
47%
57%
38%
Personal Finances
66%
66%
70%
57%
While a 51-percent negative rating for the economy is hardly good news, it needs some context: It's still 7 points better than the 15-year average. And it's vastly better than the all-time worst rating, 93 percent negative, in late 1991 and early 1992.
The ABCNEWS/Money Consumer Comfort Index, based on ratings of the economy, personal finances and the buying climate, now stands at +7. It's up from +1 in May but well down from +23 at the start of the year and its record +38 in January 2000.
Nevertheless, it's still above its average of -8 since this poll began in late 1985, and much better than its all time low of -50 in February 1992.
The index fell seven points in one week in January (tying the one-week record), six points in one week in February, five points in one week in March and another five points in one week in April. It then lay in a slump through mid-July, hovering between +1 and +4. The index inched up a month ago and has now been above +4 for the last four weeks.
ABCNEWS/Money Index
Today
+ 7
May 27, 2001
+ 1
Jan.
7, 2001
+23
Jan.
16, 2000
+38
Record high
2000
average
+29
Best full year
1992
average
-
44 Worst full year
Feb. 9, 1992
- 50 Record low
Average since 12/85
- 8
A Closer Look
As usual, confidence is higher among better-off Americans. The index is +34 in higher-income households compared to -41 in the lowest, +19 among college graduates while -35 among high-school dropouts, +9 among whites but -12 among blacks and +11 among men while +2 among women.
Here's a closer look at the three components of the ABCNEWS/Money index:
NATIONAL ECONOMY — Forty-nine percent of Americans rate the nation's economy as excellent or good, down two points from last week. The best was 80 percent Jan. 16, 2000. The worst was 7 percent in late 1991 and early 1992.
PERSONAL FINANCES — Sixty-six percent rate their own finances as excellent or good, up one point from last week. The best was 70 percent, set Aug. 30, 1998 and last matched in January 2000. The worst rating was 42 percent on March 14, 1993.
BUYING CLIMATE — Forty-five percent say it's an excellent or good time to buy things they want and need, up four points from last week. The best was 57 percent Jan. 16, 2000. The worst was 20 percent in fall 1990.
Methodology
The ABCNEWS/Money magazine Consumer Comfort Index represents a rolling average based on telephone interviews with about 1,000 adults nationwide each month. This week's results are based on 1,024 interviews in the month ending August 12, 2001 and have an error margin of plus or minus 3 percentage points. The question on expectations was conducted among 509 respondents August 1-12; that result has a 4.5-point error margin. Field work was conducted by ICR-International Communications Research of Media, Pa.
The ABCNEWS/Money index is derived as follows: The negative response to each index question is subtracted from the positive response to that question. The three resulting numbers are then 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.
Previous ABCNEWS polls can be found in our Poll Vault.
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