WASHINGTON, D.C. -- Gallup's Personal Economy Index before and after the global economic meltdown in 2008 shows the crisis touched everyday lives around the world. In 61 out of 96 countries, scores fell significantly, documenting a decline in economic situations at the personal and community level. Ireland led the declines, followed by other major economies such as Singapore, Spain, and the United Kingdom.
While GDP is an important measure of rising and falling economic activity in the monetized sector, it is an imprecise measure of how these changes translate into living conditions for the bulk of a country's population. Gallup's Personal Economy Index measures respondents' personal economic situations and the economics of the communities they live in. The subjective four measures that make up the index -- people's outlooks on the local job market and the local economy, as well as their outlook on and satisfaction with their own standard of living -- help compensate for these existing "blind spots."
After years of phenomenal growth, Ireland became the first in the euro-zone to enter recession in 2008, the effects of which started to show in residents' outlooks on jobs and the local economy that year. Amid double-digit unemployment in 2009, Irish optimism about the local job market, personal standard of living, and the local economy -- three of the four items that make up the Personal Economy Index -- nearly evaporated. Two percent of Irish said it was a good time to find a job at that time.
Optimism faded elsewhere around the world, but not necessarily on the same items and not necessarily to same degree. In most countries where index scores dropped, however, outlooks soured on local job market conditions and local economies. For example, in the U.S., 50% of Americans in 2007 said it was a good time to find a job; by July 2009, 14% said so.
Outlooks Improve in Few Countries
Even as the global economy crumbled, people's perceptions of their economic situations improved in eight countries in disparate corners of the world. Double-digit increases in countries such as Zimbabwe, Chad, and Malawi likely reflect macroeconomic progress and more investment in infrastructure and education.
In the case of Kosovo, Gallup observed improvement on most satisfaction measures after the country's independence that was not necessarily entirely related to actual improvements in the economic situation. Still, improvements on most measures in 2008 mostly carried over into 2009, and in some cases, improved even more.
Zimbabwe stands out because its scores on the Personal Economy Index increased more than those of any other country surveyed, rising from 8 in 2007 to 43 in 2009. Residents' outlook on each of the four items in the Personal Economy Index improved, which may largely be attributable to the easing of hyperinflation in 2009 and economic growth for the first time in a decade.
People in Some Countries Weather Economic Storm
Personal economic outlooks remained relatively stable in 27 countries and areas, including Brazil and South Korea, which can be viewed as a positive indicator given the volatile economic climate.
Gallup's Personal Economy Index scores in the 96 countries where data are available from before and after the global economic meltdown illustrate how widespread the effects of the crisis were and how it altered people's personal economic perceptions. In some countries, people's outlooks started to look dismal ahead of the meltdown in late 2008 and they became gloomier even well into 2009. In the majority of the countries surveyed, the dramatic pre-crisis/post-crisis change suggests a long road to recovery.
View the full trend on Personal Economy indexes in all 96 countries.
For complete data sets or custom research from the more than 150 countries Gallup continually surveys, please contact SocialandEconomicAnalysis@gallup.com or call 202.715.3030.
Results are based on face-to-face and telephone interviews with approximately 1,000 adults in each of the 96 countries surveyed, aged 15 and older, conducted in 2006/2007 and 2009. For results based on the total sample of national adults, one can say with 99% confidence that the median margin of sampling error for the Personal Economy Index is ±3.2 points. The margin of error at the individual item level ranges from ±2.1 percentage points in China to ±5.7 percentage points in South Korea. The margin of error reflects the influence of data weighting. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
The Gallup Personal Economy Index is an aggregation of four individual questions:
Are you satisfied or dissatisfied with your standard of living, all the things you can buy and do?
Right now, do you feel your standard of living is getting better or getting worse?
Right now, do you think that economic conditions in the city or area where you live, as a whole, are getting better or getting worse?
Thinking about the job situation in the city or area where you live today, would you say that it is now a good time or a bad time to find a job?
A positive answer to each question is coded "1" and all other responses as "0." If a record has no answer for an item, then that item is not eligible for inclusion in the calculations. An individual record has an index calculated if it has valid scores for at least three questions. A record's final index score is the mean of valid items multiplied by 100. The final country-level index score is the mean of all individual records for which an index score was calculated.