Gallup’s Economic Confidence Index improved 10 percentage points in the week after Osama bin Laden’s death, May 2-8. This surge in confidence brought the Index up to -25, the highest weekly confidence level since mid-February and just three points shy of what it was during the same week in 2010. Although economic confidence was at a 2011 weekly low point of -39 during the week ending April 24, it improved to -35 the next week, just prior to the announcement of bin Laden’s death.
‘Halo’ Effect Likely
Gallup Daily tracking suggests that jubilation and positivity about the death of Bin Laden carried over to other consumer perceptions. Still, Gallup cautions the precise extent to which the US killing of bin Laden affected Americans’ current confidence in the economy is unknown.
Gallup’s Economic Confidence Index consists of two measures: one involving Americans’ views about whether the U.S. economy is “getting better” or “getting worse” (see below) and Americans’ ratings of current economic conditions as “excellent,” “good,” “only fair,” or “poor.” Both measures showed substantial improvement last week.
Future Outlook Notably Improves
Americans’ optimism about the economy rose last week, with 37% saying it is “getting better,” up 19% from 31% the previous week. This is the highest level since mid-February and within four points of where such optimism stood during the comparable week in 2010.
‘Poor’ Ratings Tumble
The percentage of Americans rating current economic conditions “poor” improved to 43% during the week ending May 8, down 8.5% from 47% of the previous week, and the lowest level of negativity on this measure in about a month. The measure shows little change from the 44% “poor” rating of the same week a year ago.
Bin Laden Likely One of Several Factors
Economic confidence surged last week coincident with Americans’ positive reaction to bin Laden’s death, but Gallup analysis indicates other factors likely also contributed. For example, the government reported that the economy created a larger-than-expected 244,000 jobs in April, despite an increase in the US unemployment rate to 9%. What was generally perceived to be a good jobs report combined with Mother’s Day celebrations probably added to Americans’ positivity at the end of the week.
Gallup says the surge in economic confidence, like that in Obama’s approval rating, has the potential to fade, as do the good feelings surrounding bin Laden’s death as Americans get back to focusing on their day-to-day lives.
US Economic Optimism Plummets in March
Americans’ optimism about the future direction of the US economy plunged in March 2011, as the percentage of Americans saying the economy is “getting better” fell to 33%, according to Gallup data released in April 2011. This figure is down 19.5% from 41% in January and is also 8% from 36% in March 2010.
About the Data: Results are based on telephone interviews conducted as part of Gallup Daily tracking during the week ending May 8, 2011 with 3,468 respondents, aged 18 and older, living in all 50 U.S. states and the District of Columbia, selected using random-digit-dial sampling.