Story Highlights
- Slight uptick in Gallup's Economic Confidence Index to -13
- Democrats' confidence rating is up 49 points since first half of January
- Republicans' confidence is down 35 points over same period
WASHINGTON, D.C. -- Americans' pessimism about U.S. economic conditions has eased slightly, although Gallup's Economic Confidence Index remains in negative territory. An eight-point increase to -13 this month puts the index at its best reading since November.
Line graph. Gallup's Economic Confidence Index, 1996-2021. The current -13 reading is up from -21 in January and is better than the -33 low from the spring of 2020. The lowest point, -72, was during the Great Recession in October 2008.
Gallup regularly tracks Americans' ratings of national economic conditions as excellent, good, only fair or poor and whether the economy is getting better or getting worse. The combined responses are used to create the Gallup Economic Confidence Index, which has a theoretical range of +100 (if all respondents say the economy is excellent or good and that it is getting better) to -100 (if all say it is poor and getting worse).
The latest rating, from a Feb. 3-18 poll, comes after back-to-back declines in December and January that followed seven months of steady or slightly improved readings. Before that, the ECI fell sharply from +41 in February 2020 to +22 in the first half of March and then -33 in the latter half of April as the coronavirus pandemic caused an economic crisis in the U.S.
Since dropping below zero in early April, the confidence rating has not risen above -1. Still, the most recent rating is 20 points higher than it was at its lowest point in the spring and is well above the record-low -72 recorded in October 2008, during the Great Recession.
The public remains more negative than positive on both components of the confidence index. Currently, 20% of Americans rate economic conditions in the U.S. as "excellent" or "good," while 31% say they are "poor"; and 39% say they are "getting better" while 54% say they are "getting worse."
The improvement from last month has come on the outlook dimension. In January, 29% believed the economy was getting better and 66% worse. The increase more than offset a decline in ratings of current economic conditions from January's 28% excellent or good and 33% poor.
Democrats' Confidence Rises as Republicans' Falls
Political partisanship is a major driver of Americans' economic ratings, and history has shown that partisans' views are heavily influenced by whether the sitting president is from one's own party. Even as Americans' evaluations of the economy shifted in response to the effects of the coronavirus pandemic in 2020, Republicans' ratings remained much more positive than Democrats' and independents' while Donald Trump was in the White House. When the U.S. economy was largely shut down in April to help contain the spread of the virus and the U.S. unemployment rate hit nearly 15%, Republicans' evaluations of the economy remained modestly positive on balance.
Republicans' positive ratings of the economy began to fall after the election. For their part, Democrats' economic ratings did not start to shift significantly until Joe Biden was in office. Independents' ratings of the economy -- typically much less influenced by which party the president belongs to -- have been more stable than Republicans' and Democrats', but they have consistently had negative views since April.
Currently, Democrats' economic confidence rating is +9, Republicans' is -37 and independents' is -14. This marks a 49-point increase in Democrats' confidence since Biden's inauguration. At the same time, Republicans' rating has fallen 35 points and independents' has ticked up five points.
Line graph. Gallup's Economic Confidence Index from January 2020 to February 2021, by party. The latest index readings are -37 among Republicans, +9 among Democrats and -14 among independents. Republicans' confidence has fallen 35 points since January 2021, while Democrats' has increased 49 points.
Democrats' Outlook Up More Than Rating of Current Conditions
The first component of the index -- the net ratings of current conditions as excellent or good minus poor -- finds improvement among Democrats (+16 points) since Biden's inauguration. At the same time, Republicans' and independents' assessments have fallen 33 points and eight points, respectively. Still, Republicans remain slightly more positive than Democrats and independents about the current state of the economy.
Line graph. Partisans' ratings of the economy as excellent or good minus poor since January 2020. The latest ratings show a 16-point improvement among Democrats to -14 and declines among Republicans (33 points to -4) and independents (eight points to -13) since the inauguration of Joe Biden.
The other component of the ECI -- the net outlook ratings of economic conditions as getting better minus getting worse -- shows a much sharper increase in Democrats' positivity than is seen in their assessment of current conditions. In all, Democrats' net outlook has risen 81 points since January to +31, while Republicans' has fallen 38 points to -70 and independents' has ticked up 18 points to -14.
Line graph. Partisans' ratings of the outlook for the economy -- getting better minus getting worse -- since January 2020. The latest ratings show that Democrats' net outlook has risen 81 points since January to +31 while Republicans' has fallen 38 points to -70 and independents' has ticked up 18 points to -14.
Bottom Line
Although the U.S. unemployment rate remained above 6% in January, and work continues on another COVID-19 relief package, Gallup's Economic Confidence Index ticked up eight points in February. This change is largely owed to Democrats' increased confidence as their party regained the White House. At the same time, Republicans' confidence decreased nearly as much as Democrats' increased.
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