CUNA Mutual Group survey: Middle class less optimistic about economy

CUNAMutualGroup_Logo_VT_4CMiddle-class Americans are less optimistic about their ability to achieve upward mobility than they were six months ago, according to new data from CUNA Mutual Group.

As previously reported, when CUNA Mutual Group first polled the middle class in November 2018, survey respondents gave themselves a B- when asked to grade the ability of the middle class to achieve the American Dream. The current grade of survey respondents has dropped to a C.

The main cause of this anxiety is fear that after several years of strong economic growth, close to 50 percent of respondents expressed worry that the U.S. will enter a recession in the next year. However, when thinking about their personal economic position, the majority of respondents in the survey feel relatively stable, with 61 percent saying they are somewhat to very confident, and 88 percent said they feel their job is somewhat or very secure over the next year, according to the survey.

CUNA Mutual Group found that the middle class could be doing better in its analysis and two-thirds are only “somewhat” confident, meaning they can comfortably pay their bills, but want to save more over time.

“The middle class is mired in uncertainty,” said Steve Rick, chief economist at CUNA Mutual Group. “This should be a wake-up call to families to start shoring up their finances now, whether that takes the form of cutting spending, reassessing their savings to avoid having to cut into their retirement to stay afloat, or even refinancing a mortgage if that’ll put them in a better position. If there’s one thing 2008 taught us, it’s that you can’t afford to be caught on your heels if a recession hits.”

Additional findings from the survey found that survey respondents are aware of their economic vulnerabilities. In the event of a recession, 53 percent of respondents said they would decrease discretionary spending, and 52 percent said they would make lifestyle changes.

Overall, female respondents appeared to be more pessimistic when it comes to the current economy. The survey found that 54 percent said they feel somewhat or very confident about their economic position, versus 68 percent of men. 18 percent of females said they do not feel very confident about their economic position, compared to 11 percent of men; women are significantly less likely to feel their employment is secure, with 43 percent saying their jobs feel very stable, versus 51 percent of men; and 51 percent of female respondents were more concerned with a recession, compared to 48 percent of men.

Women aren’t the only respondents with a heightened sense of uncertainty, with the survey finding more anxiety among parents than their child-free counterparts. 54 percent of respondents with children were more concerned the U.S. will enter a recession in the coming year compared to 47 percent of those without children

The survey also found that parents are also willing to be more aggressive about steps they would take to maintain stability in a recession. Most notably, they were almost twice as likely as those without children to reduce their retirement savings contributions, according to CUNA Mutual Group.

The 2019 CUNA Mutual Group survey polled 1,288 U.S. adults ages 18 or older and making an annual income of $35,000 to less than $100,000. The survey was conducted in May 2019.

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