“As many questions swirl about a double dip recession, a large majority of Americans do not even think we’ve come out of the first recession.” –The Harris Poll
The great psychiatrist Elisabeth Kübler-Ross had a saying that went something like this: “People are like stained-glass windows. They sparkle and shine when the sun is out, but when the darkness sets in their true beauty is revealed only if there is light from within.”
I interpret that quotation to mean that, when the going gets tough, only folks that maintain their own creative internal energies can find the power to soldier through. Thing is, based on a number of polls of late, “inner fire” seems to be tamped down among a lot of Americans these days – and that doesn’t bode well for the future of the economy, much less the freight volumes a strong economy produces.
Take a recent survey conducted by the Harris Poll between September 12 and 19 among 2,462 U.S. adults. It found that seven in ten U.S. adults (69%) say the U.S. is still in a recession while one in ten say the U.S. came out of a recession but will now enter a new recession (11%). Only a measly 10% think the U.S. is now recession-free and the economy is growing, Harris found.
Looking at the economy in general, Americans continue to be pessimistic. In July, Harris found one-quarter of Americans (23%) expected the overall economy to improve in the coming year, two in five (41%) thought it would stay the same and a little over one-third (37%) thought it would get worse. This month, however, 45% think the economy will stay the same, 34% believe it will get worse and 21% think it will get better in the coming year, the polling firm reported.
Breaking down economic conditions to a regional level, just one in ten Americans rate the economic condition of their region of the country as good (12%), with 22% saying it is neither good nor bad and two-thirds (65%) saying it is bad – not happy stuff, for sure.
Compare that to May, when one in five U.S. adults (18%) thought the economy in their region was good, 23% said it was neither good nor bad and three in five (59%) said it was bad. It definitely indicates Americans are definitely more down in the dumps about their economic prospects.
Hand in hand with pessimism on the overall economy is pessimism on the job market, with Harris indicating that two-thirds of Americans (67%) rate the current job market in their region of the country as bad, one in ten (11%) rate it as good and 22% say it is neither good nor bad.
Compare that to July, when 64% of U.S. adults said the job market was bad, 12% said it was good and 24% said it was neither good nor bad.
So, OK, folks definitely see the glass as half empty now; certainly nowhere near half full. Yet is this truly a “negative” outlook? And what does it mean for freight?
Well, first of all, this lack of confidence in economic direction is convincing many folks to spend less, focusing just on necessities, while continuing to pay down debt and repair their balance sheets – not exactly bad trends, if you ask me.
Businesses are doing this, too, hoarding cash and spending only what’s necessary. That’s why job creation is this country has been so anemic, despite big improvements to corporate balance sheets over the last few years.
For the near term, this lack of confidence and thus lack of spending will of course hurt freight volumes, as consumer spending makes up 70% of U.S. economic volume. But longer term, when things improve and average Americans feel more secure where they are financially, a lot of pent up demand could be released, which would provide a much rosier freight picture for truckers.
It reminds me of another quote I heard recently, from the soon-to-be-released fantasy-action film Bunraku: “The hero is not always the strongest man; sometimes, he’s just the guy that leads the way.”
