A majority, 63%, of middle-class Americans thinks that the U.S. is in a double-dip recession, the First Command Financial Behaviors Index shows. Fifty-percent thought the U.S. had reverted back into recession last summer.
Among those who believe the country is in a recession, 75% think it will be more than a year before the economy regains strength, and 20% think it will take more than three years, according to the index, which is based on a survey of 1,000 consumers by Sentient Decision Science.
“Americans aren’t looking for a meaningful recovery anytime soon,” said Scott Spiker, CEO of First Command Financial Services. “The index reveals a widespread believe that the U.S. has already experienced a recession and a short-lived recovery and is now experiencing a second recession. This conviction is being fueled by a host of pressing economic worries that do not come with quick resolutions, further intensifying consumer uncertainty and concern.”
When asked what is the cause of the weak economic growth, 69% of those who think the nation is in a recession pointed to unemployment. Fifty-five percent pegged the blame on the weak housing market, 54% noted global debt, 48% said slowed consumer spending, and 41% earmarked low consumer confidence.
Middle-class Americans are evidently not blaming government actions for the poor economic state, with only 28% citing tax hikes, 27% government spending cuts, and 24% expiration of government stimulus money.
The survey also found that many middle-class people are trying to improve their own personal finances by saving more, spending less and cutting debt.
“Half of middle-class Americans say they have embraced frugality as a way of life,” Spiker said. “The silver lining to the economic turmoil has been a rediscovery of frugal living, and a more conservative approach to personal finance that is helping families weather the current economic storm and commit to building a stronger financial future.”