- Weaker prospects of real income growth, comfortable retirement
- Election adds to uncertainty in University of Michigan survey
A record share of households are uncertain about the US economic outlook, most expect inflation to take a bigger chunk of their incomes and the likelihood of a comfortable retirement is the lowest in a decade.
Americans have been financially stressed from a higher cost of living and elevated borrowing costs, and a topsy-turvy election year is contributing plenty to uncertainty, according to the latest data from the University of Michigan.
While consumer sentiment picked up to a four-month high in early September amid expectations of tamer short-term inflation and Federal Reserve interest-rate cuts, the gauge of current conditions is still near the lowest on record.
A wide variety of topics in the university’s survey show that the present level of unease among Americans is at historic levels. The current environment even supersedes the levels seen after the Great Recession or the immediate post-pandemic period in some measures.
While the pace of inflation is cooling, prices remain much higher than before the pandemic. The consumer price index has surged 21.5% from the end of 2019. While incomes have also increased, consumers still say they’re not getting ahead.
The Michigan survey showed the share of consumers who expect no income growth after inflation in the coming five years now stands at the highest on record.
Even as stock prices approach a record, the odds of a comfortable retirement are at the lowest level since 2013. Not all Americans are investors or have retirement accounts that have benefited from surging equity prices since the pandemic.
Written by: Vince Golle and Alexandre Tanzi @Bloomberg
The post “US Consumers Are on Edge About Income, Retirement in Latest Data” first appeared on Bloomberg