Post-Election Economic Sentiment Plunges Amid Worsening Pandemic
Consumer economic sentiment saw its second consecutive decline in the wake of a drawn-out election and rapidly climbing COVID-19 cases. The latest reading of the HPS-CivicScience Economic Sentiment Index (ESI) showed a drop of 2.2 points to 47.8, most of which occurred after election day according to the three-day moving average. This ties with a drop in July as the ESI’s most significant single-reading drop since March’s 9.3-point plunge at the outset of the pandemic.
In the first reading following the win of President-elect Joe Biden, all five the ESI’s individual indicators fell during the two-week reading period. The largest decline was a 3.6-point drop in confidence in personal finances, followed closely by a 3.5-point drop in confidence in making a major purchase. Consumer sentiment toward the housing market and broader U.S. economy also fell by 1.8 and 1.2 points, respectively. The indicator that showed the smallest loss was confidence in the job market, which dropped by 0.8 points down to 39.2.
The decline in confidence over the past two weeks comes as the public turns away from election news coverage and grapples with the rise in new virus cases. Just yesterday, the U.S. saw 135,000 new coronavirus cases and 1,403 additional deaths, sparking concerns over hospital capacity and renewed efforts to slow the spread. While the latest jobs report showed signs of a continued rebound, experts remain concerned about long-lasting effects. The sizeable drop in how people are feeling about their wallets ahead of the holiday season—particularly the loss in the personal finance and major purchase indicators— lines up with the Bureau of Economic Analysis’s recent finding that personal income fell significantly even as GDP grew, adding to the sense of urgency for Congress to pass another stimulus package.
The ESI’s three-day moving average began the two-week stretch at 48.8, rising to its two-week high of 50.2 on November 2. The moving average fell to its low of 44.8 on November 8 before bouncing back to close out the reading at 47.0 points..
About the Index
The HPS-CivicScience Economic Sentiment Index (“ESI”) is a “living” index that measures U.S. adults’ expectations for the economy going forward, as well as their feelings about current conditions for major purchases. The primary goal of the Index is to accurately measure movements in overall national economic sentiment and to provide a more sophisticated alternative to existing economic sentiment indices. Unlike other prominent indices that release consumer sentiment estimates infrequently, the HPS-CivicScience Index is updated in real time as responses are collected continuously every hour, every day. Large-scale cross-tabulation of survey responses and consumer attributes enable more granular analyses than are currently possible through prevailing measures. For a more detailed overview of the Index and the underlying methodology, please request a white paper.
CivicScience, Inc. provides the leading intelligent polling and real-time consumer insights platform, the InsightStore™. Its proprietary platform powers the world’s opinions and quickly gets that data to the decision makers who care. Every day, CivicScience polls ask millions of people questions related to thousands of topics, while its powerful data science and big data technology analyzes current consumer opinions, discovers trends as they start, and accurately predicts future behaviors and market outcomes. CivicScience polls run on hundreds of premier websites, in addition to its own public polling site at www.civicscience.com. CivicScience’s InsightStore™ is used by leading enterprises in marketing research, advertising, media, financial services, and political polling. For more information, visit CivicScience by clicking here and follow them on Twitter – @CivicScience.