How Insecure Are We? Polls Ask Americans About Financial Health

Posted February 27, 2007 at 3:32pm

Three Congressional committees have held hearings recently about economic anxiety, and the topic is rarely far from the front pages. How serious is the problem? Pollsters regularly ask questions about people’s perceptions of the economy as a whole, and the media focus almost exclusively on this big picture. But what do people say about their own circumstances?

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Jobs: Gallup’s data on whether people expect to lose their job goes back 30 years. In the firm’s most recent asking, 10 percent said it is very or fairly likely that they could lose their job in the next 12 months. A third said the prospect is not too likely, and 57 percent said not at all likely. Fifteen percent in another Gallup question said they have been laid off in the past five years.

When the question was broadened, as RBC/Ipsos does, and people were asked about the likelihood that they or “someone else they know personally” could lose their job in the next six months, 18 percent said this was extremely or very likely, 27 percent said somewhat likely, and 54 percent said not very likely or not likely at all.

In Gallup’s questions from 2003, 2004 and 2005, 9 percent, 11 percent and 12 percent, respectively, said they personally were worried that their company would move jobs to countries overseas. Yet people think outsourcing is bad and that many Americans will be affected by it.

Personal Finances: The Los Angeles Times (now polling with Bloomberg) started asking people in 1991 to describe the state of their personal finances. In the newspaper’s January question, 15 percent described their finances as very secure, and 56 percent were fairly secure. Sixteen percent described them as fairly shaky, and 12 percent said they were very shaky.

In 2006, 11 percent told Gallup that they were very worried about not being able to pay their rent or mortgage and 16 percent were moderately worried. As for not being able to make minimum payments on credit cards, 9 percent were very worried and 8 percent were moderately worried. Fourteen percent were very worried about not having enough money to pay normal monthly bills, and 24 percent were moderately worried. The responses have been fairly stable since the questions were first asked in 2001.

Around 70 percent in five Gallup surveys since 2002 have said that they have enough money to live comfortably. In a CBS News/New York Times question that is phrased differently, 38 percent said they had enough money to save and buy extras, 44 percent said they had just enough to meet their bills and obligations, and 17 percent said they did not have enough to take care of those things. In Pew polls from 2005 and 2006, 10 percent and 9 percent, respectively, said they had declared bankruptcy in the past. When Zogby asked people recently whether they are making financial progress, 41 percent said they were, and 41 percent said they are keeping up with monthly expenses. Thirteen percent said they were falling behind, and 3 percent described themselves as “hopelessly behind.”

Retirement: Fourteen percent of retirees in a Wall Street Journal/Harris Interactive survey said their current living expenses were much higher than what they expected, and 22 percent said they were slightly higher. Most said they were about what they expected (45 percent) or lower (18 percent).

Health Care: Twenty percent of those surveyed by Harvard, Robert Wood Johnson and International Communications Research said that in the past 12 months they had had problems paying medical bills, while 79 percent said they had not. Sixteen percent in another question said there was a time in the past year when they or another family member needed medical help but did not get it. The reason for those who faced this situation: money.

About 38 percent in a February 2006 Kaiser poll said they were very worried and 33 percent were somewhat worried about having to pay more for health insurance. An April 2006 Gallup survey showed that 23 percent of respondents were very worried and 22 percent were moderately worried about not being able to pay medical costs for normal health care. A third were very worried about the costs of a serious accident, and 21 percent were moderately worried.

Which perspective should we trust more, the local or the global? Both are important in politics, but I give more weight to what people know best, that is, what they say about their own lives.

For more information, see the American Enterprise Institute public opinion study on economic insecurity at www.aei.org/ publication25668.

Karlyn Bowman is a resident fellow specializing in public opinion and polls at the American Enterprise Institute.