5 Things podcast: Why are many Americans still stressed about their finances?
On a special episode of the 5 Things podcast: Telling the story of our huge economy means telling the story of the people navigating its powerful and often clashing currents. While reports show a healthy economy right now, millions of Americans feel anxious about their financial prospects. Older Americans worry that AI may soon replace them. Meanwhile, some young people feel a sense of “perma-pessimism” after living through two recessions since 2007. These concerns, of course, may shape political choices in 2024. USA TODAY White House Correspondent Joey Garrison and USA TODAY Money Reporter Bailey Schulz join the 5 Things podcast to discuss America’s economic and political landscape. This is part of an ongoing special podcast series we’re calling “Our Economy.”
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Hit play on the player above to hear the podcast and follow along with the transcript below. This transcript was automatically generated, and then edited for clarity in its current form. There may be some differences between the audio and the text.
Dana Taylor:
Hello, I'm Dana Taylor, and welcome to a special episode of 5 Things. Today is Thursday, October 19th, 2023. Growing concerns about AI replacing human workers or making employees anxious about their future, for younger generations enduring economic challenges could significantly influence political choices in 2024. Here to discuss America's economic and political landscape, our USA TODAY White House correspondent, Joey Garrison, and USA TODAY money reporter, Bailey Schulz. Joey and Bailey, thanks for joining me.
Joey Garrison:
Thanks for having us.
Dana Taylor:
So, Joey, with inflation easing and the risk of recession fading, why are Americans still stressed about the economy?
Joey Garrison:
Well, yeah. I mean, inflation has eased and we're certainly at a better spot than we were a year ago, but many Americans, they're not feeling that ease. We took a poll with Suffolk University a month ago, and one of the big things that stood out was food prices. That's something that resonates with everybody, but particularly lower income people. Coming out of the pandemic unemployment rate is at a 50-year low, but a lot of that hasn't resonated with people and they still feel economic anxiety. And people who have an income of lower than $100,000 are really going to feel more pessimistic of the economy. And people who are wealthier, better off financially, are not feeling as much.
Dana Taylor:
And then we've had polling on the economy. We've had polling on the election. What kind of reaction did we see from the President from this story, Joey?
Joey Garrison:
Politically, he's really attached himself to the fate of the economy, and it's really a gamble because when you ask people what they think about Bidenomics, a lot of people immediately say inflation as opposed to what some of the things he's talking about, which are investing in domestic manufacturing and his efforts to lower prescription drug prices. Biden and the White House in recent days put a new term out there called MAGAnomics, which is painting the side of what they call trickle-down economics of Republicans and their philosophies.
Biden really needs to win this economic message a year out from the election, which Donald Trump right now is the front-runner for the Republican nomination. Our poll found that by 11 percentage points more people trust Trump to fix the economy than Biden to improve the economy, and that's not a great spot for an incumbent president. The economy is always front and center in a presidential race. There's going to be a lot of other issues that could help decide the election, but you definitely don't want to be 10 points or more below your opponent when it comes to that, how voters feel about that issue.
Dana Taylor:
Well, Joey, Biden's plan is to ignite a new green economy in "forgotten towns", giving a once thriving steel town a boost. How's that message been resonating with the people who live there?
Joey Garrison:
Through the Inflation Reduction Act, President Biden's administration has offered incentives to companies that invest in clean energy. And so what he wants to do is turn some of these depleted factory towns in the Midwest into the frontlines of this new green economy. One of these towns, myself and a colleague, Maureen, went to is in West Virginia. That's in the northern part of West Virginia, steel country, right next to Pennsylvania and Ohio. And the company there is investing in a new battery plant that is going to produce 750 jobs.
We went to that community to just see how they're perceiving this new project coming up, and people, no question, were excited about it. They think it offers a brighter future for their area, but at the same time they don't look at it as a remedy for their immediate economic concerns. So there's really a disconnect between the policies coming out of the White House and how it is affecting people's everyday problems.
Dana Taylor:
Well, Bailey, the price of housing, particularly starter homes, have put homeownership out of reach for many young Americans. The cost of childcare and college have also skyrocketed. Do most Americans believe that younger generations face more hardships than previous generations?
Bailey Schulz:
Yeah. I don't think there's a question that every generation has had its own challenges and its own issues, but we're seeing these younger millennials, Gen Zers, they're coming into a world with issues stemming from climate change and new technology and divisive politics. And so we did a poll of more than 2,000 Americans, and what we found was that all sorts of generations think that this younger generation is dealing with more hardships. And what surprised me was that this was agreed upon across the line. So you had Gen Z saying this, you had millennials saying this, you had boomers saying this. And so Americans across the board are just saying that younger generations are dealing with these new challenges today.
Dana Taylor:
And then despite a majority of us saying that younger Americans are facing more economic hardships, the Gen Z generation doesn't seem to be sweating it. What did you discover about how they handle their finances?
Bailey Schulz:
Yeah. So my colleague, Claire Thornton, did a piece looking at Gen Z spending and saving, and found that despite all of the uncertainty with the economy today, Gen Z is pretty comfortable with both. And so our polling found that about 89% of Gen Z said they saved money on something this year, more so than any other generation. And at the same time, 75% said that they spent a lot on something this year, also more than any other age group.
And so they seem to be more likely to buy less of something that doesn't matter to them and more likely to splurge on things if they think that it really does matter to them. For example, there was someone in Claire's story and she said that she'll drop any amount of money to see Lana Del Rey in concert, but if there's a certain makeup brand that goes up in price, even a little bit, she'll stop buying it.
Dana Taylor:
Well, the way young professionals approach their work lives differs from older generations. Do Gen Z and millennials simply have misunderstood priorities when it comes to work and finances? What did the USA TODAY Harris polling reveal?
Bailey Schulz:
We chatted all sorts of generations about what matters to you between work and just your outside life, and we found that it's not just Gen Z that wants to put life outside of work first. So this Harris Poll survey we did found that nearly three out of four boomers and Gen Xers said they care more about who they are outside of work, and that's compared to 79% of millennials and 69% of Gen Z.
These age groups have similarities in that aspect, but how they approach that sort of mindset seems to be different where Gen Z millennials tend to be more open when they're demanding things like flexibility and remote work and varying daytime work hours. Whereas boomers and Gen Xers, they tend to define the work-life balance in these blocks of hours and they want to be able to step away from work once those work hours end.
Dana Taylor:
Well, Bailey, have younger Americans given up on achieving the American dream? How do they measure their financial success?
Bailey Schulz:
Our poll found that about 65% of Gen Zers and nearly three in four millennials say that they feel like their financial starting point is far behind where previous generations were at the same age. And so that's some of those economic challenges we talked about earlier, with housing costs and inflation and student loans. And for a lot of them, with all this piling up, they're saying that idea of the American dream with the white picket fence is just not attainable at this point in time.
But I think it's also important to realize that the American dream is not the same for everyone where some might think, "Oh, I'm only financially successful if I'm a multi-millionaire," where others might say, "Oh, I just want a home and a little bit of extra cash and not to worry about budgeting." And so this is something that I think means something different to all sorts of Americans. I think you see differences across generations and in genders, and in between maybe first and third or whatever generation of Americans.
Dana Taylor:
And how can folks who feel pinched stretch their dollars? What are some of the strategies that savvy shoppers have come up with?
Bailey Schulz:
Look around on sites like Facebook and try and find deals groups where a lot of times there's tips in there on things that are priced down or maybe even free. We also heard that shopping around is good advice for people these days where I know Amazon is easy, where you pull it up on your phone, you find the first thing that pops up, you add it to your card and you're done. But if you need something like paper towels, it might be more cost-effective to go somewhere like Dollar General or Target and scan the shelves, see where it's cheaper.
Take the time to price compare. Once you do find a good deal, another tip from these shoppers is to stock up. So if something's marked down, something that could last in your pantry or closet for a while, buy a few of them and stock up in that way. I think the easiest tip in that article was for drivers, where if you are filling up your car with premium gas, there's a good chance you don't need to.
Dana Taylor:
Joey, was there anything that stood out or surprised you?
Joey Garrison:
There was one question that I think really summed it up and that was asking Americans, "Describe the economy in one word." Over 75% of Americans had some sort of negative reaction, whether that was horrible, terrible, bad, poor, struggling, or chaotic. Only 18% had something positive to say, whether that's excellent or good or growing or improving.
Now, I think that just kind of sums up. We've gotten out of the height of inflation that we saw a year ago, but it's just not really something that people feel yet in their pocketbooks, and there's still a sense that we have a long ways to go to get back to where we were in pre-pandemic levels. And so that is just an alarming juxtaposition there between how many folks say something bad when asked about the economy versus positive. And I think it really underscores the problem politically for Biden right now and just the concerns that are out there for Americans.
Dana Taylor:
And did anything stand out for you, Bailey?
Bailey Schulz:
Yeah. I think what Joey was talking about there with a lot of concerns about the economy, that definitely showed up when I was doing interviews as well with different millennials and Gen Zers where I spoke to two Gen Zers who were both working. They had both been in dental school, and they were still living with their parents. They couldn't afford an apartment of their own. One said she couldn't even afford an apartment with roommates at this point, even though she was working full-time.
I think one of the things that jumped out to me was that there was a lot of pessimism among younger generations, especially that Gen Z, in that pessimism seemed to switch or ease as they grew, where millennials started to feel a little more confident and then older generations felt more confident in our pollings just on the future in general. But I think we'll have to see exactly how this economy shakes out and how it affects these newer generations.
Dana Taylor:
Bailey and Joey, thanks so much for joining us today.
Bailey Schulz:
Thank you.
Joey Garrison:
Thank you so much, Dana.
Dana Taylor:
Stay tuned in about a month for the next episode on our economy. We're especially grateful to the many 5 Things listeners who wrote in to share their economic stories. Your voices were integral to our coverage. Thanks to our senior producer, Shannon Rae Green, for production assistance. Our executive producer is Laura Beatty. Let us know what you think of this episode by sending a note to [email protected]. Thanks for listening. I'm Dana Taylor. Taylor Wilson will be back tomorrow morning with another episode of 5 Things.
