PRINCETON, NJ -- A new Gallup analysis of the relationship between Americans' views of the economy and of recent presidents' job performance finds that the two measures are not always closely related, but have been thus far in 2012. The analysis suggests that if economic confidence rises in the coming months, President Barack Obama's job approval rating will likely rise as well.
Obama's approval rating averaged 46% last week, at the same time the Gallup Economic Confidence Index averaged -21. Gallup's model tying presidential job approval to Americans' economic confidence indicates that Obama's approval rating would reach 50% -- important for improving his chances of re-election -- if economic confidence were only a bit higher. This analysis puts the target confidence level somewhere between -16 and -13 in Gallup's weekly averages of economic confidence. While still negative in absolute terms, those would be the highest scores Gallup has recorded since 2007.
This analysis is based on select years when presidential approval and economic confidence were closely linked. Specifically, Americans' ratings of the economy and of the president's job performance moved in tandem in five of the past 12 years, with correlation scores of 0.5 or higher: 2001, 2003, 2004, 2008, and 2012 to date. Gallup trends during these five years indicate that a 50% approval rating would be associated with an economic confidence score of -16. When basing the analysis solely on 2012 data -- which may be more appropriate for Obama -- the data indicate economic confidence would need to rise to -13.
Data for all other years during which approval and economic confidence were significantly less related -- 2002, 2005 through 2007, and 2009 through 2011 -- are excluded from the forecast estimates. In 2002 and from 2005 through 2007, the war on terrorism and the Iraq War may have overridden the economy as the dominant issues defining George W. Bush's presidency. Plus, Bush's job approval rating in 2003 was drifting down from his all-time-high reading of 90% after the 9/11 terrorist attacks, even as economic confidence improved.
Additionally, from 2009 through 2011, Americans may not yet have held Obama accountable for the state of the economy, and thus the two ratings were largely detached. That was particularly true in 2009 and 2010, as the debate over healthcare reform was at its peak. Obama's job approval rating and economic confidence began to show more of a connection in 2011, albeit still relatively weak.
This analysis is based on weekly averages of Gallup Daily tracking from January 2009 through the present, and on monthly Gallup polls from 2001 to 2008.
The findings underscore the general relationship between ratings of the economy and presidential job approval, but also show how specific circumstances can override that basic relationship. As noted, that relationship has strengthened in 2012, to the point that the economy now appears poised to be a critical factor in Obama's approval rating -- and therefore his chances for re-election.
Gallup's Economic Confidence Index is based on the combined responses to two questions, in which Americans are first asked to rate economic conditions in the country today, and then asked whether they think economic conditions in the country as a whole are getting better or getting worse. The Index has a theoretical maximum value of +100, attainable if all Americans were to say the economy is excellent or good and improving, and a theoretical minimum value of -100, if all Americans were to say the economy is poor and deteriorating.
The Index hit its all-time low of -65 in October 2008 as the global financial crisis was unfolding (based on weekly averages). After recovering to -18 in early 2011, it fell back to -54 last summer amid the federal debt ceiling debate and related downturn on Wall Street. The -18 weekly average in early March ties the most positive level seen since Obama took office. However, the Index has since receded slightly, averaging -21 in the most recent week.
For the first few years of Obama's presidency, many more Americans said they held George W. Bush highly responsible for the state of the economy than held Obama highly responsible. That corresponded with the low yearly correlations reported here between Obama's approval rating and economic confidence from 2009 through 2011. Now, in Obama's fourth year as president, the relationship between consumer views of the economy and Obama's approval rating is quite strong.
This relationship provides additional support for the widely held assumption that Obama's standing in the eyes of the public this year, and thus his re-election chances, are yoked with the state of the economy. While a number of different indicators can be used to evaluate the health of the economy -- such as stock market performance, unemployment, gross national product, and consumer prices -- what ultimately counts in the election is how Americans weigh these factors.
Americans' economic confidence has in general been improving over the past six months, likely caused by a decrease in unemployment and a rise in the stock market. Gallup's analysis indicates that relatively small gains in economic confidence from this point forward should be associated with enough gain in Obama's job approval rating to push it to the 50% level -- the threshold above which previous incumbent presidents have all been re-elected.
Of course, the current connection between economic confidence and presidential job approval also makes Obama especially vulnerable to any decrease in consumer optimism. It is also possible that another issue will emerge in the coming months, displacing the economy as uppermost in Americans' minds. However, barring such changes, Obama's fate now appears more closely linked with the economy than at any other time in his presidency.
Explore President Obama's approval ratings in depth and compare them with those of past presidents in the Gallup Presidential Job Approval Center.
The statistical analysis of presidential job approval and economic confidence is based on telephone interviews conducted as part of Gallup Daily tracking from January 2009 through March 2012, and on monthly Gallup polls from 2001 through 2008. Gallup Daily tracking interviews are conducted with a random sample of adults aged 18 and older, living in all 50 U.S. states and the District of Columbia.
Gallup Daily tracking interviews are conducted with respondents on landline telephones and cellular phones, with interviews conducted in Spanish for respondents who are primarily Spanish-speaking. Each sample includes a minimum quota of 400 cell phone respondents and 600 landline respondents per 1,000 national adults, with additional minimum quotas among landline respondents by region. Landline telephone numbers are chosen at random among listed telephone numbers. Cell phone numbers are selected using random-digit-dial methods. 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, and phone status (cell phone only/landline only/both, cell phone mostly, and having an unlisted landline number). Demographic weighting targets are based on the March 2011 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 https://www.gallup.com/.