COVID-19 Has Wrecked Consumer Confidence in All 50 States
The COVID-19 pandemic is, first and foremost, a public health crisis. However, the harm the virus has wrought extends far beyond public health. The U.S. economy has been devastated — and Americans are far less optimistic about their own personal finances and the broader business conditions today than they were just a few months ago.
The growing economic pessimism is well warranted. Consumer spending accounts for about 70% of GDP, and in recent months, social distancing and stay-at-home orders have ground much of the economy to halt, prompting historic unemployment claims in the tens of millions.
24/7 Wall St. reviewed changes in the consumer sentiment index from research company Morning Consult to determine how far consumer confidence has declined in each state from March 1 through May 15.
According to Morning Consult, consumer confidence is not necessarily impacted by the coronavirus’s local or regional spread. Rather, broader national trends appear to have a more significant impact on economic optimism. Still, some of the states where consumer confidence has fallen the most, like Connecticut and Massachusetts, also have higher than typical concentrations of the virus. Here is a look at the states with the highest number of COVID-19 cases.
In many states, the precipitous fall in consumer confidence is likely linked at least in part to government-mandated business closures and stay-at-home orders. Some of the states with smaller than average declines, such as Montana and South Dakota, have had some of the shortest and least restrictive orders. However, even as states have begun to relax social distancing measures in one way or another, such easing appears to have had little effect on boosting economic optimism. Here is a look at every state’s rules for staying at home and social distancing.