President Joe Biden’s economic approval numbers have risen modestly in the wake of efforts by the White House to promote what it calls “Bidenomics” and some improvement in inflation, but a substantial majority of respondents to the CNBC All-America Economic Survey still disapprove of Biden’s handling of the economy.
The survey also found that Republicans hold double-digit leads on which party Americans believe is best to handle critical economic issues like inflation and jobs and that higher interest rates are beginning to hit Americans in their wallets.
The president’s economic approval rating inched up by three percentage points compared to the prior survey in April, with a four-point drop in disapproval. It now stands at 37% approving and 58% disapproving. The 21 point net-negative rating rose substantially from negative 34 one year ago. It was driven by double digits gains in approval from Democrats, but also men and retirees.
The survey showed small gains in American’s views on the economy, though to levels that remain depressed. The percentage of American saying the economy is excellent or good rose 6 points to a still-low 20%. The percentage saying the economy is just fair or poor declined 6 points to a still-high 79%. Just 24% of the public believes the economy will improve in the next year, a relatively low mark for the survey but up six points compared to April and the percentage expecting the economy to get worse fell 10 points to 43%.
“I think it’s some combination of the messaging (and) of people possibly legitimately starting to think that the economy is not quite as bad anymore,” said Jay Campbell, partner at Hart Research, which served as the Democratic pollster for the survey. Campbell cautioned the data only show Americans believe “things are a little less horrible than they have been” and there isn’t enough data yet to know if the improvement is the beginning of a trend.
There’s little sense in the survey that the White House should celebrate. The President’s overall approval rating remains unchanged from the prior survey at 39% with 55% disapproving and marking only a 5-point improvement over the past year in his net-negative rating.
The survey of 1,000 adults was conducted July 12-16 and has a margin of error of +/-3.1%.
No. 1 issue: Inflation
It took place in the wake of ongoing efforts by the White House to promote the president’s economic record and with the unemployment rate remaining near all-time lows. Inflation, which had risen to nearly 9%, has fallen to around 3% but remains a point above levels before the pandemic. Maybe more significantly, prices have not dropped so Americans continue to pay more for goods and services than they used to.
As a result, inflation was named the No. 1 issue by 30% of respondents. That’s more than double any of the other areas of concern, which include threats to democracy, immigration and border security, health care and crime.
And Americans believe Republicans have better policies than Democrats to handle the key economic issues, often by substantial margins. Republicans lead Democrats by double digits when asked which party would do a better job on the economy, inflation and improving the respondent’s personal financial situation. They lead by single digits when it comes to jobs and keeping energy costs down.
“Those are very broad, very important parts of economic confidence. That the Republicans have double digit leads … helps to understand and underpin the deficiencies that Biden has in those areas and on the economy broadly,” said Micah Roberts, partner at Public Opinion Strategies, which served as the Republican pollster for the survey.
Campbell added, “This is a tough set of results for Democrats at this moment…It shows the degree to which Biden and the Democrats are really going to have to work very hard to make their case that they are better suited to run the economy going forward for the next four years. That’s a difficult case to make when people’s attitudes, while slightly better than they have been, are still pretty bad when it comes to the economy.”
Higher interest rates impact
Democrats had double-digit leads on which party is better for reducing the cost of health care and reducing housing costs.
In general, Republicans led on economic issues because Republicans gave their own party high marks, while Democrats were less enthusiastic about themselves. For example, 81% of Republicans believe their party will do a better job on inflation. Only 57% of Democrats think that’s true of their own party.
The survey also found Americans are feeling the pain of higher interest rates and it’s changing how they conduct their finances and spending. Majorities of American say they are less likely to buy a car or a home or take out a home equity line of credit because of higher rates. 31% say they are more likely to pay off their credit cards.
Looking specifically at the impact of higher mortgage rates, 43% say they have either delayed buying a home, rented instead of bought or bought a less expensive home. About one in 10 Americans say they have turned down a job because it would require a move. The survey shows the pain of higher rates is felt more among the poor than the upper class, more among younger Americans than older, and more in the South than the Northeast.
But there was one piece of good housing news: 44% of American homeowners believe their home price will increase in the next year, up from 35% in the prior quarter and back to average levels before the pandemic. The numbers back up other data that suggest the housing market may have bottomed.
A bit of optimism has also returned to the stock market with 33% of those surveyed saying now is a good time to invest in the stock market, up from 24% in the April poll. But with 46% saying it’s a bad time to invest, the prevailing negative views on equities remain in stark contrast to the time before the pandemic when Americans, sometimes by more than 20 points, thought the time was ripe for equity investments.
View the full survey results here.