Even if the growth is muted and even if employment remains pressured, things have continued to improve in America. It turns out that not everyone expects the recovery to last. A release from Bankrate.com (NYSE: RATE) shows that only about 50% of Americans are actually confident that the economic recovery will continue throughout 2012. Without much surprise, it is the current circumstances driving the results of the poll.
Greg McBride, senior financial analyst for Bankrate.com, believes that this lack of conviction regarding a sustained economic recovery could become a self-fulfilling prophecy if it also translates into lower consumer spending. With about 70% of GDP tied to consumers he noted, “a hesitant consumer delays recovery in the housing market and the overall economy.”
Bankrate noted from its poll:
- its Financial Security Index fell from 97.3 to 97.0 this month, and that is now the same level as March 2011.
- Readings over the last year have fluctuated between a high of 98.5 in May 2011 and a low point of 92.3 in August 2011.
- Any reading below 100 indicates a lower level of financial security compared with 12 months earlier.
When asked about ‘will the recovery continue throughout 2012?:
- only 13% were very confident
- 37% were somewhat confident – usually those under 30, households with income above $75,000 per year and/or college graduates
- 26% were not too confident, living mostly in rural communities and/or the Northeast U.S.
- and 22% were not at all confident, mostly aged 50 and above, households with income under $50,000 per year, those with a high school education or less, and in the unemployed and/or retirees.