During a recession, most consumers begin to worry about the ability to pay their regular monthly bills. Concerns about becoming unemployed and/or underemployed tend shift the focus of people on most mundane daily needs. Contrary to previous recessions, this does not seem to be the case for consumers in 2002.
This lack of concern over paying bills may be attributable to that fact that the recent recession has been the "mildest" on recent record. Or, it could be the result of the way the population is aging. Or, just maybe it is because this recession has had a major negative "wealth effect" that is not well perceived [see "Wealth Effect" Means Many Will Work Longer]. Whatever the reasons, Americans told Gallup in a recent poll (April 8-11)* that they are most concerned about longer-term issues as opposed to those of the immediate future.
When asked how concerned they are about a variety of financial matters
- 54% say that they are most concerned about not having enough money for retirement (25% "very worried"; 29% "moderately worried")
- 45% say that they are most concerned about not being able to pay the medical costs in the event of a serious illness or accident (21% "very worried"; 24% "moderately worried")
- 35% say that they are most concerned about not being able to pay the medical costs for normal healthcare (18% "very worried"; 17% "moderately worried")
- 35% say that they are most concerned about not being able to maintain the standard of living they enjoy (12% "very worried"; 23% "moderately worried")
- 30% say that they are most concerned about not being able to pay their normal monthly bills (11% "very worried"; 19% "moderately worried")
- 22% say that they are most concerned about not being able to pay their rent/mortgage (8% "very worried"; 14% "moderately worried")
- 15% say that they are most concerned about not being able to make minimum payments on their credit cards (7% "very worried"; 8% "moderately worried")
For most Americans, the greatest impact of the recent "mild" recession may have been a reduction in wealth. This may in turn have heightened their longer-term concerns about retirement and catastrophic events such as major medical problems.
Still, it should be noted that between a quarter and a third of Americans are concerned about their daily living standard. While the economic averages may suggest a very mild recession has taken place, for a significant minority of the population the recession has clearly created real worries about basic solvency. Thus, growing concerns about current consumer debt levels may be more significant than many anticipate.
* These results are based on telephone interviews with a randomly selected national sample of 1,002 adults, aged 18 and older, conducted April 8-11, 2002. For results based on this sample, one can say with 95% confidence that the maximum error attributable to sampling and other random effects is ±3%. 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.
