Inflation is coming down slowly, but it’s still a rising concern for consumers.
Numerous surveys point to growing economic anxiety among Americans, and they all cite the same problem: the higher costs of everyday living.
Gallup’s monthly survey, released Friday, said 83% of respondents described current economic conditions as “only fair” or “poor” and just 16% called them “excellent” or “good.” Asked about economic conditions, 72% said they are worsening — and many cite inflation.
“With inflation hovering around 6%, the issue continues to be Americans’ biggest specific economic concern; 12% currently name it as the most important problem facing the country,” Gallup said.
In a Quinnipiac University poll released Thursday, Americans ranked food costs (22%) as their biggest worry, with retirement savings (18%) and health care costs (17%) rounding out the top three concerns. More than 6 in 10 Americans said they are cutting back on expenses such as dining out and home improvement projects.
“Persistent inflation, climbing interest rates and a volatile stock market are likely contributing to worries about everything from putting food on the table to getting medical care,” said Osman Kilic, a professor of finance at the Quinnipiac University School of Business. “One silver lining: concerns about losing jobs is at the bottom of the list.”
About 3 in 10 respondents said they have delayed buying a car or a home or making other major purchases because of economic conditions.
Economic uncertainty is also growing. More Americans told Fox News pollsters that they would rather stash a $10,000 windfall under their mattresses than invest it in the stock market.
U.S. inflation rose at an annual rate of 6% in February, three times the Federal Reserve’s 2% target. Many economists worry that the Fed’s remedy for higher prices — raising interest rates — is likely to trigger a recession later this year or early next year.
A key inflation gauge that the Federal Reserve closely monitors rose slightly less than expected in February, suggesting that interest rate hikes are moderating price increases. The Personal Consumption Expenditures Price Index, excluding food and energy, increased by 0.3% for the month, the Commerce Department reported Friday.
Over the previous 12 months, core PCE increased by 4.6%, a slight deceleration from January.
“We are making progress in the fight against inflation,” President Biden said Friday.
Although the overall inflation rate has fallen from a 40-year high of 9.1% last summer, prices for many everyday items have risen dramatically higher than the national average of the Consumer Price Index. Year over year, the price of eggs has risen 55%, breakfast cereal is up 12.5%, chicken is up 8.8%, hot dogs are up 11%, juices are up 11%, salad dressings are up 18.4%, and baby food and formula are up 9.8%.
Gas prices have fallen 2% from February 2022 to last month, and the average cost of televisions is down 14.8%, according to the Bureau of Labor Statistics, but the costs of tools and outdoor equipment are up 11.8%, paper products are up 10.8% and pet food is up 15%.
A survey by The Wall Street Journal and NORC at the University of Chicago revealed last week that strong majorities view inflation as a “major concern” (65%), think the economy is “poor/not so good” (80%) and “do not feel confident” (78%) that the next generation will be better off.
Asked what they believe will happen to the economy in the next year, 47% said it “will get worse.” Only 15% said the economy “will get better.”
About half of U.S. adults in households earning less than $60,000 annually and about 4 in 10 of those in households earning $60,000 to $100,000 say they are very stressed by their personal finances, according to The Associated Press-NORC Center for Public Affairs Research.
About three-quarters of adults across income groups say their household expenses are higher now than they were a year ago.
Those in households earning less than $100,000 a year are more likely than those in higher-income households to say they also have higher debt. Those facing a combination of rising debt and expenses overwhelmingly say their financial situations are major sources of stress.
Republicans and Democrats in Congress sharply disagree about how to reduce inflation.
The House on Thursday passed a sprawling package promoted by Republicans as a fix to soaring energy prices. The Lower Energy Costs Act would overhaul the environmental review process for energy projects to streamline their approvals, boost fossil fuel production and reduce prices.
“Let’s stand up for those families who are sick and tired of paying more when they know we’ve got the ability here to do it ourselves,” said House Majority Whip Steve Scalise, Louisiana Republican. “We can become energy independent again. It’s a national security issue, but it’s a bread-and-butter kitchen table issue for those families who are struggling.”
Democratic leaders emerged from a White House meeting Thursday to champion the hoped-for effects of last year’s $1 trillion infrastructure law. Asked whether he was worried that the spending will add to inflation, Rep. Steny H. Hoyer, Maryland Democrat, replied, “These investments will grow our economy, grow our revenues and bring inflation down, as the president’s budget and the [$750 billion] Inflation Reduction Act is designed to do.”
Both parties know that consumers aren’t feeling much, if any, relief from inflation.
Consumers racked up $180 billion more in credit card debt in 2022, the most ever added in a single year, according to a study from the personal finance website WalletHub. The average household’s credit card balance was $9,990, up 9% from the fourth quarter of 2021.
In The Wall Street Journal/NORC poll, 44% of respondents said their finances are in worse condition than they expected at this stage of their lives. Only 17% said their finances are in “better condition” than they expected.
• Sean Salai contributed to this article, which is based in part on wire service reports.
• Dave Boyer can be reached at dboyer@washingtontimes.com.
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