A July Fourth State of the Union
The American experiment turns 245 years old this Sunday (give or take). As the nation readies itself for backyard barbecues and fireworks — and as it continues to climb its way out of one of the most challenging years in its history — we thought we’d provide a snapshot of where the country is, based on data. How is our economy doing? How are voters feeling? And, perhaps most importantly after a pandemic year, are we ready to celebrate?
Let’s take a look.
U.S. Economy: Low Unemployment, High Inflation and Inequality
The U.S. Department of Labor will release employment data for June this coming Friday, but we know that the job market is improving every day. In fact, in April (the latest month for which data is available), there were 9.3 million unfilled jobs in the United States. That’s a record high. The unemployment rate tumbled from 13.3 percent in May 2020 to just 5.8 percent in May 2021. A marked improvement, but still 2.2 percentage points higher than its pre-pandemic low.
Americans doing the hiring also are feeling better — with a couple caveats.
A second quarter 2021 survey of business executives found CEOs, chief financial officers, controllers, and other certified public accountants are bullish. Seventy percent said they are optimistic about how the U.S. economy will perform over the next 12 months, up from 47 percent who said the same in the first quarter.
However, the corporate leaders did indicate that the “availability of skilled personnel” is their top concern. (See again that 9.3 million unfilled jobs data point above.)
Two-thirds of executives also said they are worried about inflation, up from 44 percent who cited that concern in the first quarter. There is good reason. Prices continue to rise. The U.S. consumer price index (CPI) was up five percent between May 2020 and May 2021. While global food prices are at their highest levels in a decade, energy costs (up 28.5 percent year-over-year) were the chief driver of CPI growth. And there might not be any relief in sight: Reuters reported this morning that oil prices will hit monthly and quarterly highs today.
Price increases will of course disproportionately impact lower- and middle-income Americans at a time when the divide between the rich and poor is gaping. According to Inequality.org, the top 10 percent of American earners now average more than nine times as much income as the bottom 90 percent. Americans in the top 0.1 percent take in more than 196 times income than the bottom 90 percent does.
Homes also are getting more expensive. According to the S&P CoreLogic Case-Shiller index, housing prices rose 14.6 percent from April 2020 to April 2021, the biggest annual jump in more than 30 years. Rising prices is one reason that, according to the National Low Income Housing Coalition, the United States is facing a shortage of 6.8 million rental homes for extremely low-income renters (families whose household incomes are at or below the poverty guideline or at 30 percent of their area median income.) Extremely low-income renters currently are having trouble finding homes in every state and the District of Columbia.
Concerns about inequality could be one reason that younger Americans are becoming more skeptical of capitalism. According to a June 2021 Axios/Momentive survey, 46 percent of 18-34 year-olds have a negative view of capitalism. That number is up from 38 percent two years ago. And lest you think this growing segment of young Americans represents only ideologically progressive voters, the number of young Republicans with a favorable view of capitalism has fallen from 81 percent in 2019 to 66 percent today.
U.S. Voters: Pro-Environment, Anti-Social Media?
Last week, Gallup released the results of a survey that explored how American voters fall generally on economic and social issues.
Surprisingly, Gallup found that Americans are more divided on economic policy than so-called social issues. Specifically, while 30 percent of Americans self-identified as “conservative” on social issues, 34 percent said they call themselves “liberal.” The gulf is far wider on economic issues. Only one-quarter of those polled called themselves “liberal” in this regard while 41 percent called themselves “conservative.” About one-third of voters said they call themselves moderates on both categories.
It is not surprising, then, that the Pew Research Center, which has been tracking voters’ ideologies for the last several decades, continues to find wide – and growing – gulfs between Democrats and Republicans on key issues.
In a survey taken in April of this year, Pew found 88 percent of Democrats and only 33 percent of Republicans thought it was the job of the federal government to provide health insurance. Another wide gulf came on the question of college education. Only 19 percent of Republicans said it is the federal government’s responsibility to make sure Americans have access to college compared to 55 percent of Democrats. More Americans (24 percent of Republicans and 59 percent of Democrats) think it is the federal government’s job to ensure access to broadband than to a college education.
The two parties do agree when it comes to basic environmental principles. More than three-quarters of Republicans (77 percent) and Democrats (95 percent) think it is the job of the federal government to guarantee access to clean water and air.
Americans also are relatively united on their distaste of social media, even if we are addicted to it. According to a May 2021 NBC News survey, 64 percent of Americans think social media platforms do more to divide us than unite us, including majorities of Republicans (77 percent) and Democrats (54 percent). The issue brings together the young and the old, too. Sixty-one percent of young people and 71 percent of senior citizens think social media divides Americans.
Pandemic Indicators: We’ve Moved On
Americans’ divisions have been made plain over the last 16 months as debates raged over lockdowns, mask mandates, and vaccine safety. But where are we today when it comes to COVID-19?
The Axios/Ipsos Coronavirus Index has been tracking Americans’ feelings about the pandemic for the last year. The latest survey, taken this month, found:
Delta Doesn’t Bother Us. Among Americans who have heard of the Delta COVID-19 variant, only one in three (36 percent) are extremely or very concerned about it.
We’re Shedding the Masks. Only one-quarter of respondents said they are wearing a mask at all times when leaving the house. Fifty-five percent said they are wearing a mask sometimes. That figure was a 13-point decline from early June.
We’re Not Going Back. When asked what they would do if COVID-cases started spiking in their state, less than half of Americans (43 percent) said they would self-quarantine and only 57 percent said they would stop having gatherings with friends and family outside of the home. Ipsos said, “These numbers are dramatically lower than when asked about stopping behaviors in light of a second wave of the virus, back in June 2020.”
Herd Immunity is Within Reach. Sixty-six percent of respondents said they have received a COVID vaccine; seven percent said they remain likely to get one; seven percent said they are not likely to get a vaccine but are not opposed to it, and 19 percent said they are not at all likely to get the vaccine. That last number has not shifted since January, Ipsos reported.
What do these numbers mean for this Independence Day weekend? That most Americans also are ready to celebrate. According to the latest Axios/Ipsos reading, about 40 percent of Americans said attending a Fourth of July celebration feels risky. That number is still high, but it is about half the level it was at one year ago.
And what do these metrics mean in terms of the future of the American economy? Bloomberg has created a COVID-19 Resilience Tracker that measures how quickly countries are reopening to the world. The tracker now has the United States in its top spot due to “a best-case scenario of high vaccinations, a waning outbreak, flight capacity nearing full recovery, and few travel curbs on vaccinated people.”
So while there are still challenges the country faces – and significant issues that politically divide us – there is unquestionably reason to celebrate this July Fourth.