![]() In a context in which price gains outstrip wage growth, more respondents than last year believe America is doing a poor job of providing opportunities for all people (Exhibit 2). Thus, in real terms, the average American household income today buys less than it could six months ago. Inflation, however, remains stubbornly high: 7.7 percent year over year in October, compared with 8.3 percent in April. And three-month moving wage growth remains strong: 6.4 percent in October, compared with 6.0 percent six months ago. The US unemployment rate is almost unchanged: 3.7 percent, compared with 3.6 percent in April when we last conducted the survey. In one significant way, Americans have reason to be optimistic. Persistent inflation weighs on Americans’ near- and long-term outlook households have some investment in the stock market,” Pew Research Center, March 25, 2020.-a stock portfolio or retirement account-shrink. ![]() Even the wealthy, who may have endured shifting economic tides early in the cycle, may be seeing their financial buffer 4 Richard Fry and Kim Parker, “More than half of U.S. As for older Americans, many of them may be on fixed incomes 3 “Income sources of older households,” US Census Bureau, February 8, 2022.-facing rising prices for everyday expenses. 2 “30-year fixed rate mortgage average in the United States,” Federal Reserve Bank of St. Today, that group is seeing interest rates rise to levels not seen in more than a decade. households (SHED),” Board of Governors of the Federal Reserve System, May 2022. Those 25 to 34 years old may have historically been saving for and looking to buy a first home. There is a range of potential drivers that could explain this declining optimism. Unlike previous surveys, the lack of optimism cut across all income levels, genders, and ages, with the sharpest declines among those aged 25 to 34 years old-a group we would expect to be optimistic given they are at the start of their careers and in a relatively job-rich economy. McKinsey’s scores of US economic outlook-scaled from 0 to 200, from low perception of economic opportunity to high perception of economic opportunity, with 100 being neutral-showed a 14-point drop from 99 to 85 in overall economic sentiment compared with a survey of six months ago and an 18-point drop from a survey of a year ago (Exhibit 1). Across every demographic group and metric, Americans have moved toward a negative view. A summer of stifling economic conditions has tipped the scales broadly to pessimism. Access to economic opportunityĪmericans were slightly pessimistic last spring. This article, part of a series, presents the survey’s findings on access to economic opportunity, the steady rise in prices, and the hard budget choices households are facing. People with lower incomes, less education, people living in rural areas, or people aged 65 and older are underrepresented among internet users and those with high-speed internet access. Given the limitations of online surveys, it is possible that biases were introduced because of under coverage or nonresponse. To better reflect the population of the United States as a whole, post hoc weights were made to the population characteristics on gender, age, race/ethnicity, education, region, and party identification. A sample of 2,010 adults aged 18 and older from the continental United States, Alaska, and Hawaii was interviewed online in English. The article is based on a five-minute, online-only Ipsos poll conducted on behalf of McKinsey between November 9 and 10, 2022.
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