According to the National Bureau of Economic Research, the U.S. economy has been in recovery for more than two years -- but job losses have continued to mount for most of 2003 as businesses have retrenched. With the strong economic releases in recent weeks, third-quarter GDP growth outpacing even the most optimistic analysts' expectations, and businesses beginning to spend again, it looks like the massive fiscal and monetary stimulus engineered by the Federal Reserve and the Bush administration is finally starting to take effect.
So although the recovery "officially" began a couple of years ago, from the average American's point of view it's just beginning. It may seem like the worst economic times are behind us, but a Nov. 3-5 Gallup Poll* reflects that Americans are still worried. The poll reveals that Americans continue to list some aspect of the economy as the most important problem facing the country today, but at a lower level than in previous months. Among these economic concerns, unemployment is one of the most prominent in the minds of Americans.
Americans Less Worried About Unemployment
The good news is that Americans are now considerably less worried about the unemployment situation than they have been in recent months. The percentage saying that unemployment is the most important problem facing the country peaked at 17% in August 2003. The most recent poll, taken Nov. 3-5, shows that percentage has fallen to 12%. Though this number has consistently declined over the last three months, it is sobering to note that significantly more Americans are worried about unemployment today than at this time last year or the year before.
The Unemployment Rate Will Stabilize
The total percentage of Americans who believe that the unemployment rate will drop over the next six months is essentially equal to the percentage who believe that it will rise. According to the results of the November poll, 37% of Americans think unemployment will go down, while 38% expect unemployment to go up -- for a net differential of one percentage point.
Over the last two years, Americans have been overwhelmingly negative about prospects for unemployment, with the number of pessimists substantially outnumbering those who believe that the unemployment situation would improve. A year ago in November 2002, the number of people who thought unemployment would go up outnumbered those who felt it would go down by 19 percentage points. November 2003 could mark a turning point -- the clouds are lifting and more people are saying they believe the unemployment rate will soon stabilize.
Bottom Line
If the November Gallup Poll is any indication, the outlook for jobs is improving. Not only are Americans less worried about the unemployment situation, but they are increasingly optimistic that the unemployment rate will come down. Unfortunately, it is still a tough job market -- 73% of Americans tell Gallup that now is a bad time to find a job. As GDP growth picks up, so presumably, will job creation. Increasingly, with more disengaged and underemployed workers entering the ranks of job seekers, the challenge will be not just to find a job, but to find the right job.
*Results are based on telephone interviews with 1,007 national adults, aged 18 and older, conducted Nov. 3-5, 2003. For results based on the total sample of national adults, one can say with 95% confidence that the margin of sampling error is ±3 percentage points.
