PRINCETON, NJ -- Gallup Daily tracking finds Americans' confidence in the economy significantly lower so far in July than in June. And confidence in June was, in turn, down from May. The Gallup Economic Confidence Index for July 1-13, at -35, is lower than any monthly average in more than a year.
Gallup first reported on this month's depressed economic confidence last week, and the subdued figures from the first week of July have persisted through July 13 interviewing.
At the same time, despite the souring consumer mindset, American workers continue to report more positive than negative news about hiring at their places of employment. Also, while not showing much of an increase, consumers' self-reported spending is at least flat compared with 2009.
"According to the nightly results of Gallup Daily tracking, the decline in economic confidence evident in July actually began in late June, immediately following the sharp drop in the U.S. stock market that occurred on June 29."
Economic Pessimism Is Mounting
The decline in confidence seen in recent months is owing primarily to mounting public skepticism with the economy's direction. Thus far in July, 30% of Americans, on average, have said the economy is getting better and 65% have said it is getting worse, for a net -35 economic outlook score. This is down sharply from -13 in April.
By contrast, the net percentage of Americans calling current economic conditions "excellent" or "good" rather than "poor" is averaging -36 so far this month. This is only slightly below the -30 recorded in April and is comparable to the level seen for much of 2009 and early 2010.
According to the nightly results of Gallup Daily tracking, the decline in economic confidence evident in July actually began in late June, immediately following the sharp drop in the U.S. stock market that occurred on June 29. At that point, Gallup's overall Economic Confidence Index dropped to -35, having been above -30 for most of the month. Then in early July, the government's June employment report was widely reported as representing more bad economic news, given the lack of new jobs created. Although the stock market has since rebounded, economic confidence has not.
Gallup's Economic Confidence Index -- measured daily since January 2008 and monthly since October 2000 -- is on its way to registering its largest one-month drop since October 2008, when the country was reeling from the emergent Wall Street financial crisis.
Given the high correspondence between Gallup's Economic Confidence Index and the consumer confidence polls put out by the Conference Board and Thomson Reuters/University of Michigan -- both of which are skewed toward interviews conducted in the first half of the month -- it is quite likely that the Thomson Reuters/University of Michigan's preliminary report due this Friday, and the Conference Board's preliminary report to be released later this month, will show similar declines.
Gallup.com reports results from these indexes in daily, weekly, and monthly averages and in Gallup.com stories. Complete trend data are always available to view and export in the following charts:
Read more about Gallup's economic measures.
The most recent results are based on telephone interviews conducted as part of Gallup Daily tracking July 1-13, 2010, with a random sample of 5,901 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia, selected using random-digit-dial sampling.
For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±1 percentage point.
Interviews are conducted with respondents on landline telephones and cellular phones, with interviews conducted in Spanish for respondents who are primarily Spanish-speaking. Each daily sample includes a minimum quota of 150 cell phone respondents and 850 landline respondents, with additional minimum quotas among landline respondents for gender within region. Landline respondents are chosen at random within each household on the basis of which member had the most recent birthday.
Samples are weighted by gender, age, race, Hispanic ethnicity, education, region, adults in the household, cell phone-only status, cell phone-mostly status, and phone lines. Demographic weighting targets are based on the March 2009 Current Population Survey figures for the aged 18 and older non-institutionalized population living in U.S. telephone households. All reported margins of sampling error include the computed design effects for weighting and sample design.
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.
For more details on Gallup's polling methodology, visit http://www.gallup.com/.