By Jennifer Agiesta
Washington Post Staff Writer
Thursday, April 2, 2009
Consumers are keeping their wallets in their pockets and feeling increasingly anxious because of the recession, according to a new Washington Post-ABC News poll. Many report putting off big-ticket spending that could benefit the hard-hit automotive and travel industries, while also cutting out everyday indulgences such as dining out.
"We have made a whole new budget," one respondent said. "We cut out anything that is unnecessary."
Cutbacks in spending remain widespread, with nearly two-thirds of consumers trimming the amount they buy and more than three in 10 sharply curbing their purchases. As one respondent said, "I don't spend it. I don't have it."
Optimistic views on the country's economic direction are on the rise, but those who say the economy is worsening continue to outnumber those who see it improving, 36 percent to 27 percent. And more than six in 10 Americans say they are stressed out over the nation's troubled economy, with a third reporting serious stress, up six points since last month.
Stress and pessimism about the economy are closely related, as almost four in 10 who said the economy is getting worse also said they are under deep stress. But even among those who said the economy is improving, a majority called it a source of stress.
So far, positive views on the economy appear to have had little impact on spending patterns. Among those who said the economy is getting better, 58 percent said they are cutting back.
Some have reached their limit. "There are no other ways I could cut back," said one poll participant.
A broad swath of Americans is putting off major spending, buffeting industries already battered by the recession. About four in 10 said that in the past six months they have delayed or canceled plans to purchase a new car or go on vacation, and about a third have put off spending on durable goods such as appliances.
Those in households with annual incomes under $50,000 were most apt to have trimmed major expenses; about half passed on a new car or delayed a vacation, and four in 10 skipped buying appliances.
The economic downturn is increasingly affecting the sentiments of those with the best prospects for future financial success: younger Americans and the better educated. Serious stress caused by the economy rose among those with college degrees, including a 14-point spike among those who have undertaken postgraduate studies. Those under age 30 are feeling it more deeply too, with 61 percent reporting that the economy is a cause of tension, up from 48 percent in February.
Those who said they are experiencing the deepest emotional toll are also the most apt to have cut back on spending. Overall, 63 percent said they have been cutting back spending lately, a slight decrease from last month, but the proportion who have sharply curbed their spending has held steady at 31 percent.
Nearly two-thirds have cut spending by eating out less, and just under half said they have reduced their charitable giving. Asked to cite other ways in which they are making ends meet, respondents said they were cutting the basics, the splurges and nearly everything in between.
"I go to the store and see things and say 'I don't need that,' " said a poll respondent, adding, "I have cut back on potato chips and clothing."
Fewer respondents said they have put off needed medical treatment, but the practice is most common among those with household annual incomes under $50,000 and those without a college degree.
People with children younger than 18 are feeling the impact of the recession more than others, with nearly two-thirds reporting economy-related stress and about seven in 10 saying they have reduced their spending. They are about twice as likely as respondents without children to have delayed the purchase of a new vehicle or major appliance. And the family vacation has become a common casualty of the downturn, with 56 percent having put off travel.
About a third of parents said they have reduced spending on their children's extracurricular activities, including nearly half of parents with household incomes of $50,000 or less.
At the same time, some are bucking the trend. Just under four in 10 report spending at about their usual level or higher. And those who said the economy is not a source of stress are returning to normal spending patterns. More than half of these unstressed consumers said they are spending at or above their regular level.
Said one respondent, "I have not cut back. I went and bought a new vehicle; that's the way to improve the economy."
This Washington Post-ABC News poll was conducted March 26-29 among a random national sample of 1,000 adults including landline and cellphone-only respondents. Results from the full survey have a margin of sampling error of plus or minus 3 percentage points.
Polling director Jon Cohen contributed to this report.