Since the end of 2020, Americans have been increasingly feeling better about the economy and inflation. According to a survey conducted by The Associated Press-NORC Center for Public Affairs Research, 45% of Americans feel better about the economy than they did two months ago. Similarly, 41% of Americans think their local economy is better off now than it was in December 2020.
What’s particularly interesting about these figures is that even with rampant inflation increasing prices of everyday items, people’s optimism about the economy still remains relatively high. While many had predicted that inflation would erode consumer confidence, the survey, which was conducted in April of 2021, showed that only 12% of respondents felt that their personal finances have been damaged by the rising cost of goods and services.
The increased optimism about the economy can likely be attributed to a few different factors. For one, the U.S. economy had generated nearly 4.3m jobs in March 2021, a monthly record that far surpassed analysts’ expectations. This suggests that the economy is starting to make a full recovery from the pandemic-induced economic downturn.
Meanwhile, tax relief packages and government-funded stimulus programs have given Americans additional money to spend. This has led to an increase in consumer spending, which will further help the economy begin to heal.
Finally, the rollout of the vaccine has helped people to feel more secure that the pandemic could eventually come to an end. As more people become vaccinated, consumer confidence will continue to improve.
All of these things have combined to help Americans feel better about the economy and inflation. Although certain aspects of the economy, such as unemployment, still remain concerning, the overall outlook for American’s personal finances has improved. This is a positive sign for continued economic recovery.