Economic Confidence Inching UpTHURSDAY, NOVEMBER 21, 2013 - 12:01 AM
Most holiday shoppers expect to spend the same or more this year
Perceptions of the national economy are still far from rosy in Massachusetts, but a growing percentage of adults viewed the economy in a positive light in the latest survey by the Western New England University Polling Institute.
The statewide telephone survey of 517 residents, conducted Nov. 5-11, found that while 59 percent still view the national economy as “fairly bad” or “very bad,” 40 percent consider the economy “very good” or “fairly good.” The margin of sampling error for the survey is plus or minus 4.3 percentage points.
Positive assessments of the national economy have gone up by 20 percentage points since the last time the Polling Institute posed the question in a statewide survey in March 2011, while negative ratings have dropped by the same amount. Improvement in perceptions came primarily in the rating category “fairly good,” which doubled from 19 percent in March 2011 to 38 percent in the latest survey.
The survey also found that 16 percent of adults said they plan to spend more on gifts in the upcoming holiday season than they did last year, while 52 percent said they plan to spend the same amount and 27 percent said they would spend less.
Attitudes in Massachusetts regarding holiday spending plans have improved considerably since fall 2008, when the nation’s financial and economic crisis was unfolding. In a survey that the Polling Institute conducted Nov. 6-13, 2008, only two percent of adults said they would spend more on holiday gifts compared to the previous year, while 34 percent said the same amount and 60 percent said less.
“The latest survey data suggest that Massachusetts residents think the economy still has a long way to go toward recovery, but the outlook has brightened over the past few years,” said Tim Vercellotti, director of the Polling Institute and a professor of political science at Western New England University.
The survey also found:
- 5 percent of adults said they expect the national economy to get better within the next 12 months, 17 percent expect the economy to get worse, and 46 percent said it will stay the same, with little change in the expectations compared to the last time the Polling Institute asked the question in March 2011.
- 25 percent of adults expect their personal financial position to get better within the next 12 months, down five points from the March 2011 survey; 14 percent said they expect their financial position to get worse, up two points; and 60 percent said they expect their financial position to stay about the same, up four points.
- When asked about the timing of economic recovery, 30 percent of adults said the economy is recovering now; 26 percent said the economy is not yet recovering but will recover soon; and 43 percent said it will be a long time before the economy recovers. Sentiment in the state is similar to national results that the Pew Research Center found when it posed the same question to 1,480 adults in a telephone survey in July.
The latest Polling Institute survey found that perceptions of the current health of the national economy were directly related to plans for spending during the upcoming holiday season. Among adults who rated the national economy as very good or fairly good, 17 percent said they would spend more on gifts this year compared to last year, 61 percent said they would spend the same amount, and 17 percent said they would spend less.
Adults who expressed a negative assessment of the national economy were more likely to say they are cutting back, with 32 percent vowing to spend less this year compared to last year, while 16 percent said they would spend more and 46 percent said they would spend the same amount.
Holiday spending plans varied by age and annual household income. Thirty-two percent of adults ages 18 to 34 said they would spend more this year and 19 percent said they would spend less. Among adults ages 65 and older, six percent said they would spend more, and 31 percent said they would spend less this year.
As annual household income rose, the percentage of adults saying they plan to cut back on holiday spending this year declined. Among adults with annual household incomes of under $35,000, 16 percent said they would spend more and 36 percent said they would spend less. Nineteen percent of adults with annual incomes of $100,000 or higher said they would spend more this year, while 16 percent said they would spend less.
Current perceptions of the national economy varied by political partisanship, education and income. Voters who identified themselves as Democrats were more likely than Republicans and independents to describe the economy in positive terms, and the same was true for adults at the upper end of education and income scales.
Fifty-nine percent of Democrats described the national economy as very good or fairly good, while only 24 percent of Republicans and 33 percent of independents said the same. Thirty-four percent of adults with a high school diploma or less characterized the economy as very good or fairly good, compared to 49 percent of college graduates. Among respondents with annual household incomes of under $35,000, 36 percent described the economy as very good or fairly good, while the same was true for 50 percent of adults with household incomes of $100,000 or more.
Democrats also tended to be more optimistic about the immediate future than Republicans and independents. Forty-six percent of Democrats said they expect the national economy to get better within the next 12 months, and only seven percent said the economy would get worse. In contrast, 17 percent of Republicans said the economy would get better and 32 percent said worse, while 29 percent of independents said the economy would get better and 21 percent said worse.
The partisan differences also extended to expected changes in personal financial position. Thirty percent of Democrats said they expect their personal financial position to get better within the next 12 months and seven percent said worse. Among Republicans, 20 percent said better and 21 percent said worse, while 20 percent of independent voters said better and 10 percent said worse.
Men were more likely than women to say they expect their financial position to get better within the next 12 months, 33 percent to 18 percent. Two-thirds of women said they expect little change, compared to 54 percent of men.
Young people ages 18 to 34 were the group most likely to express either optimistic or pessimistic views about their financial position in the near future. Thirty-four percent said they expect their personal finances to get better within the next 12 months, while 25 percent they expect their finances to get worse.
“The numbers for young people seem to reflect two distinctive aspects of their economic situation,” Vercellotti said. “Some members of this group may be expressing youthful optimism, while others may feel a vulnerability that is especially acute in the early stage of one’s working life.”