(TrendHub — Posts by ICARUS Reporter) According to a recent survey conducted by the Pew Research Center, Americans currently rate the economic situation as ‘not so bad’. The survey revealed that 28% of respondents perceive the economic situation positively, an increase from 19% in April 2022, but still lower compared to 57% before the pandemic in January 2020.
Economist Kyle K. Moore of the Economic Policy Institute pointed out that recent improvements in the economic situation might mask underlying issues such as delayed wage increases, growing inequality, and lack of public investment. Moore stated, “While the current economic situation can be considered not bad, there is a need to address chronic issues.”
Data from the U.S. Bureau of Labor Statistics shows a slowdown in inflation and improvement in unemployment figures. However, high living costs and low wages remain as primary causes of negative perceptions of the U.S. economy. Jocelyn Kiley, the associate director of research at Pew, mentioned, “Despite the reduction in inflation, many Americans are still feeling its impact.”
Recent layoffs announced by major corporations like Microsoft, Citigroup, Google, and eBay are influencing Americans’ economic perceptions, indicating an unstable outlook for the economy.
Rising costs in education and healthcare, along with increased housing expenses, are adding to households’ economic burden. Notably, wage growth has not kept pace with productivity increases from 1979 to 2020. Data from the Economic Policy Institute reveals that Black and Hispanic workers are facing more severe financial difficulties.
These various factors highlight the complexity of the current U.S. economic situation, necessitating a deeper understanding and analysis. The background behind Americans’ assessment of the economy as ‘not so bad’ appears to be influenced by these diverse factors.
Investment Insight:
The recent survey results from Pew Research Center, indicating that Americans view the current economic situation as ‘not so bad’, provide several important implications for investors. Firstly, this perception reflects a stability in consumer sentiment, which can positively impact consumer-driven industries. However, as economist Kyle K. Moore from the Economic Policy Institute has pointed out, this positive perception may conceal fundamental issues such as delayed wage increases, growing inequality, and lack of public investment. This suggests that investors need to observe long-term structural economic issues carefully, rather than focusing solely on current economic indicators.
Additionally, the reduction in inflation and improvement in unemployment rates, as indicated by the U.S. Bureau of Labor Statistics, are positive economic signals. However, high living costs and low wages continue to contribute to a negative perception of the economy. This is particularly important when considering investments in labor-intensive industries or industries reliant on low-wage workers. The recent layoff announcements by large corporations indicate an unstable economic outlook, meaning investors should approach corporate financial health and growth prospects with caution.
Factors such as rising costs in education, healthcare, and housing are increasing households’ economic burden, which could impact consumer spending. In the long term, data showing wage growth not keeping pace with productivity increases since 1979 highlights long-term income inequality issues, which could affect consumer purchasing power.
Ultimately, these varied economic factors suggest that investors need to analyze the market from multiple perspectives and build investment portfolios prepared for various economic situations. Especially, consideration of Socially Responsible Investing (SRI) and Environmental, Social, and Governance (ESG) investment criteria related to economic inequality is becoming increasingly important.
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