There are signs that some of the worst turbulence has eased since last year. According to Tuesday’s Labor Department report, there was a decline in the number of job openings, but it was still high by historical standards. The rate of hiring also increased. An earlier report showed that more people returned into the labor force in November. Also, various measures of supply-chain tensions have begun to ease.
That was before the Omicron variant of coronavirus caused an explosion in cases. This has forced airlines to cancel flights and businesses to delay return to office plans. School districts have been forced to temporarily return to remote learning. Forecasters believe that the latest Covid-19 wave will prolong economic uncertainty, but it is too early to predict how it will impact inflation, spending, or the job market.
Despite the increase in demand for workers and the pay rises that some have received, Americans remain pessimistic about their economy. Only 21 percent of adults said their finances were better off than a year ago, according to a survey released Tuesday — down from 26 percent when the question was asked a year earlier, even though, by most measures, the economy had improved substantially during that period. The survey of 5,365 adults, conducted by Momentive, an internet research firm formerly known under SurveyMonkey, was conducted last month.
Momentive’s survey has been running for nearly five years and overall consumer confidence is at its lowest level. Since President Biden’s election a year ago, Republicans have been particularly pessimistic regarding the economy. However, Democrats have become more pessimistic in recent months. Similar results have been found in other surveys.
Inflation appears to be a big reason for people’s dark outlook. Momentive survey respondents said that inflation has not had a significant impact on their finances. But nearly nine in 10 said they were at least “somewhat concerned” about inflation, and six in 10 said they were “very concerned.” Worries about inflation cross generational, racial and even partisan lines: 95 percent of Republicans, 88 percent of independents and 82 percent of Democrats say they are concerned.
“Pretty much the only group of people who say they’re better off now than they were a year ago are people who’ve gotten a pay raise that matches or beats inflation,” said Laura Wronski, a research scientist at Momentive.
Source: NY Times
