Some experts say the US economy is on the rise, but here’s why voters don’t think so

Many Americans are downbeat about the economy, despite some data suggesting it is improving.

The Economist even brought this discussion to TikTok. When American editor John Prideaux examined inflation, wage and employment figures, he concluded that the US has “an objectively pretty good economy.”

Is Prideaux or the American electorate wrong? And if the US economy is recovering, why is President Joe Biden not seeing an economic recovery in the polls?

Political commentator Robert Reich recently explained: “The economy is generally getting better – but has become a less useful measure of well-being overall.” Reich suggested that the common way the economy is measured can obscure more diverse or individualized economic trends, such as wealth inequality. That is to say, the macroeconomic indicators are right, but that only tells us part of the story.

Experts often use the same narrow metrics to define the very large, complex concept of economics. Commonly cited measures such as GDP are often seen as synonymous with the economy itself. Importantly, however, when polling firms ask Americans about the issues important to their vote, the economy, not GDP, is given as an option.

Voters think about the economy in very different ways. Researchers note that the public often perceives the economy through the lens of their personal experience.

As part of my research, I conducted seventeen in-depth interviews and reviewed social media comments, asking what Americans mean when they say “the economy.” The answers include topics as diverse as religion, marriage and nature.

This may seem incorrect, but economic researchers already know that these are all elements of economics. Religion can shape economic behavior. Spouses combine savings to make larger purchases. Finally, nature provides the physical resources necessary for production and consumption.

Only one interviewee mentioned GDP, but only to say that GDP is not the economy. He advised looking at “measures of well-being”.

This is consistent with research that aims to better reflect these other aspects of the economy that are important to people. It is from these more inclusive surveys that we can understand the pessimism of American voters.

The Academy of Arts and Sciences’ Commission on Reshaping Our Economy released a report in November 2023, recommending additional measures to assess the economy around “well-being”: security, opportunity, mobility and democracy.

The report includes an interview with Kailin, a cafe worker and single mother in Kentucky. She worries about losing Supplemental Nutritional Assistance Program benefits or health insurance if she gets a raise. She explains that if she goes over a penny, she is immediately excluded from assistance, even if it is not enough to cover household expenses.

British research organizations have experimented with citizens’ assemblies to bridge the gap between expert and everyday perceptions of the economy. During these discussions, participants use personal stories to explain the economy. As one citizen put it: “The big thing on my mind is corporate profits (…), then the shareholders get nice dividends based on those profits, while John’s father freezes it.”

The meetings established an economic charter that emphasizes fairness, innovation for social good, sustainability and transparency.

Writing in the New York Times, Chrystal Audet, who lives in her car, tells interviewers, “It’s the irony of working and making a decent living and still not being able to afford housing.” The cost of renting a home is the worst ever, leading to record levels of housing insecurity. Chrystal is one of the 40-60% of homeless Americans who have a job but still can’t afford housing.

Dissatisfaction with the economy can also be related to political dissatisfaction. American economist Paul Krugman recently noted that pessimism about the economy is stronger among Republicans than among Democrats. Similarly, Black Americans viewed the economy more negatively during the Trump administration.

A Washington Post-Ipsos poll interviewed Black Americans to explore this trend. One interviewee, Francine, explained: “When I’m in a room with white women, I know that 50 percent of them voted for Trump… I look at them and think, ‘How do you see me? What does my humanity mean to you?’” Francine explains how racism inhibits the economic opportunities of Black Americans, a well-documented feature of the American economy.

These four examples – Kailin, John, Chrystal and Francine – demonstrate what can be described as subjective views on the economy. After all, they are based on varied personal experiences. However, these views are based on the way they experience the economy.

No doubt some voters believe Biden deserves more credit for his economic performance. However, voters do not feel positive and may therefore not trust what the experts, or the government, say. This comes at a time when public confidence in government is at an all-time low.

There is no universal agreement on how economics is defined, let alone what defines a good or bad economy. However, this discrepancy between data and public opinion could be an opportunity. Everyday experiences can help experts better understand where the economy is not performing.

Jessica Eastland-Underwood received funding from the University of Warwick’s Department of Politics and International Studies to undertake their PhD research.

Jessica Eastland-Underwood, PhD candidate, University of Warwick