Gas prices have dipped below $3 a gallon across over two dozen states, marking a decrease from the national average of $3.9 per gallon. This drop signals a 35 cent decrease in the last month. On another positive note, the stock markets are maintaining near-record highs. However, these enticing figures might not paint a complete picture of American sentiment toward the current economy.
When it comes to evaluating the economy, research shows 85% of Americans align their judgement with their own experiences. On the other hand, the significance given to national data like GDP, unemployment rates, and inflation is significantly lower (66%). An even smaller percentage of Americans (42%) consider the state of the stock market when forming their opinions on the economy.
One key factor to consider is how citizens' income compares to inflation. Astonishingly, only 24% of Americans think their income is keeping up with inflation, leaving a significant 76% who disagree, according to a recent CBS News poll.
When looking at disposable income from the first year of a president's term to now, President Biden’s term sees negative growth. The disposable income has come down relative to inflation, at negative 2.7%. However, when we look back since JFK, we can see an average increase of 4.5% during a president's term. Over the last six months, there has been a marginal income growth of 0.2%, but it is still considerably lower than the average six-month growth since 1960.
When combining the slight growth in incomes with median weekly wages and salaries, these two metrics aren’t painting an accurate picture of the economic growth that economists are attributing to American households. The median wages and salaries have seen merely a 1% growth rate pre-pandemic, maintaining the same pace during the first year of Biden’s term. The last quarter has seen no growth at all. Given these financial figures, it's likely many American households aren't feeling the economic growth that economists suggest.
