Economic Ratings Slightly Better; U.S. Mood Unchanged

WASHINGTON, D.C. -- Gallup's Economic Confidence Index is -10 this month, up slightly from -16 in August. From a longer-term perspective, confidence has improved substantially from a recent low of -33 in April amid national economic shutdowns to contain the spread of the coronavirus. But it remains well below readings in January and February, which were the highest Gallup had measured in nearly two decades.

The index summarizes Americans' evaluations of current economic conditions and their assessment of whether the economy is improving or getting worse and has a theoretical range of -100 to +100.

Americans are currently more negative than positive on both items comprising the confidence index:

• 31% rate current conditions as "excellent" or "good," while 34% evaluate them as "poor."
• 40% say the economy is "getting better" and 56% say it is "getting worse."

The improvement in the index reflects a less negative assessment of the direction of the economy. Last month, 32% said the economy was getting better, and 61% said worse.

The latest results are based on an Aug. 31-Sept. 13 poll, conducted as the nation continues to grapple with the coronavirus and ongoing protests, sometimes deadly, around racial justice and policing. During the poll's field period, the government released the August labor report, which showed a sharp drop in the unemployment rate, to 8.4%, from 10.2% in July. The stock market also registered record highs in early September, although the markets have been somewhat volatile lately.

U.S. Mood Holding Steady

Americans' satisfaction with the state of the nation is holding near historical lows, even as their evaluations of the U.S. economy are slightly better. Currently, 14% of Americans are satisfied and 85% dissatisfied with the way things are going in the U.S., essentially unchanged from 13% satisfaction readings in July and August and seven percentage points above the record low 7% satisfaction in October 2008. As recently as February, 45% of Americans were satisfied.

Despite the low satisfaction ratings, President Donald Trump maintains a 42% job approval rating, largely because of his overwhelming support among Republicans. But Republicans are generally not satisfied with the way things are going in the U.S. -- 26% are, compared with 14% of independents and 2% of Democrats.

Meanwhile, 17% of U.S. adults approve of the job Congress is doing, which is by one point the lowest for that metric this year. Earlier in 2020, Congress enjoyed ratings that were the highest in more than 10 years after passing a coronavirus relief package.

Economic Ratings, Satisfaction Put Trump Reelection in Peril

In addition to Trump's job approval rating, which is significantly below the 50% level that essentially ensures incumbent reelection, today's satisfaction and economic confidence readings are also problematic for the president, given their relationship to incumbent reelection in the past.

Not only is satisfaction well below the prior low point at the time when an incumbent was reelected -- 33% in 2012 -- it is also below the 22% it was when George H.W. Bush was defeated in 1992. Gallup did not ask satisfaction in 1980, the year Jimmy Carter lost his reelection bid, but polls in late 1979 and early 1981 (before his term ended) measured satisfaction at 19% and 17%, respectively.

Economic confidence is not as low as it was in 1992 (-37) but is lower than it was in 1996, 2004 and 2012 when incumbents successfully sought reelection.

Implications

The economy continues to show signs of bouncing back from the pandemic-induced shutdowns, but the latest positive news on employment and the stock market have done little to improve Americans' economic outlook. Their awareness or recognition of the recovery may be tempered by the knowledge that more Americans remain out of work than before the pandemic and many industries and businesses face uncertain futures.

The challenges brought forth by the coronavirus are affecting all Americans to some degree, and incidents of deadly violence both perpetrated by, and aimed at, police officers have added to the tension. Americans' satisfaction with the state of the nation has been lower in the past but only on rare occasions and typically during similarly challenging economic times. And while Americans do not have to be highly satisfied with national conditions to reward an incumbent with a second term, the current level is below what it was in the past when the public voted incumbents out of office.

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