But nearly half still believe the economy is in a recession or even a depression

PRINCETON, NJ -- Forty percent of Americans believe the U.S. economy is growing, up from 27% last April and 3% in 2008. While this represents a major shift in economic perceptions over the last four years, nearly half of Americans, 46%, still say the economy is in either a recession or a depression. An additional 13% say it is slowing down.





Negative perceptions of the economy were already the dominant view in January 2008. These become significantly worse in September 2008 -- after the start of the global financial crisis -- when many more Americans said the economy was in a recession or depression than merely slowing. Since then, fewer Americans have said the economy is slowing or in a recession or depression, while more have said it is growing.

Americans' increasing positivity is widespread, given that optimism that the economy is growing has increased fairly evenly across the nation's major social, regional, and political subgroups.





Politics Play a Role in Economic Assessment

Despite these gains, the only groups who mostly (50% or more) believe the economy is growing today are those with, perhaps, the political motivation to do so: Democrats, nonwhites, and self-described liberals. By the same token, Republicans and conservatives, who may be reluctant to praise the economy under a Democratic president, are least likely to say the economy is growing. The reverse pattern was seen in 2008 under President George W. Bush.

Perhaps troubling for President Obama and other incumbent officeholders seeking re-election this year: political independents' reading of the economy is closer to Republicans' than to Democrats'. Just over a third of independents say the economy is growing, while about half say it is in a recession or depression.

Increased Perceptions of Economic Growth Mirror Rise in Economic Confidence

The longer-term trend in Americans' perceptions of whether the economy is growing correlates strongly with their fundamental perceptions of U.S. economic conditions, as summarized in Gallup's Economic Confidence Index. Economic confidence bottomed out in late 2008 but has since improved.





More specifically, the 40% now saying the economy is growing conforms with the 38% to 42% of Americans telling Gallup in recent days that the economy is "getting better," in one of the two questions that make up the Gallup Economic Confidence Index. At the same time, the 46% saying the economy is in a recession or depression is also similar to the percentage who rate current economic conditions as "poor," a response from the other index component.

Bottom Line

Americans' perceptions of the economy have been improving, but are still not positive on balance. That finding has been evident in Gallup's Economic Confidence Index for some time, and is reinforced in this update of how Americans describe the current state of the economy.

The fact that the majority of Americans believe the economy is either slowing or in a recession/depression is out of sync with government data showing the U.S. economy has grown for 10 consecutive quarters, since the second half of 2009. However, that divergence is reminiscent of the public's mood 20 years ago, when George H.W. Bush sought re-election as the country was coming out of a recession. Although the economy was demonstrably recovering in 1992, Americans still felt it was ailing, Bush failed to fully recognize that during his re-election campaign, and voters failed to reward him with a second term. There may be lessons in that for Obama to heed today.