Joe Biden Has Turned the Economy Around, But Americans Remain Skeptical

President Joe Biden's administration has seen a significant improvement in the U.S. economy since the Democrat took over in January, with jobless claims down and disposable incomes up.

However, Americans still appear skeptical about the nation's economic gains, reflected in a largely gloomy outlook in recent polling, while Biden's approval rating remains in negative territory.

The U.S. has suffered serious economic issues this year, with soaring inflation in October and major problems in the global supply chain leading to a backlog of cargo ships at some ports.

The Consumer Price Index (CPI) for October recorded a 6.2 percent increase year on year - its highest level in 30 years - and inflation has quickly become a major political concern as Democrats attempt to pass the $1.75 trillion Build Back Better Act.

While inflation remains a key issue and there is uncertainty about it, there are indications that the supply chain crisis began to ease in November and that these improvements will continue into 2022.

The U.S. had its lowest level of weekly jobless claims since 1969 this week, with just 43,000 new unemployment claims.

That figure came after it was announced in November that the unemployment rate has fallen to 4.2 percent - a 21-month low. Unemployment stood at 6.3 percent in January, 2020.

Wages and salaries paid by private businesses also rose between January and October, recording an increase of 2.4 percent after inflation, while disposable income grew 3 percent after inflation in the same period.

Americans are also in line for the largest pay increase in over a decade in 2022, according to a report from the Conference Board, a business membership and research group organization.

The Conference Board's November Salary Increase Budget Survey showed a rise of 3.9 percent in wage costs for businesses in the coming year. This would be the biggest increase since 2008.

U.S. Gross Domestic Product (GDP) has also risen significantly, by an annual rate of 7.8 percent in the third quarter when adjusted for inflation. The Federal Reserve said in September that it expected a GDP increase of 5.9 percent for the whole of 2021 and another increase of 3.8 percent in 2022.

Despite these positive economic indicators, recent polling shows that Americans still view the economy in negative terms.

A Wall Street Journal poll published on Tuesday found that 60 percent of respondents believed the economy was heading in the wrong direction, while a Gallup poll published on December 2 found that 45 percent of households felt inflation was causing them financial hardship.

Americans have consistently expressed pessimism about the economy, with a poll from The Associated Press and the NORC Center for Public Affairs Research published on November 1 finding that just 35 percent of Americans believed the state of the economy was good, while 65 percent rated it poor.

Lingering Concerns About the Economy

A Washington Post/ABC News poll published on November 14 showed that 70 percent of Americans rated the economy negatively and a CBS News poll published on November 21 found that 30 percent of people said the economy was good and 67 percent disapproved of Biden's handling of inflation.

Meanwhile, the president's approval ratings aren't looking strong. Poll tracker FiveThirtyEight gave Biden an approval rating of 42.6 percent as of December 9, while his disapproval stood at 51 percent.

The apparent disconnect between the economy's performance and Americans' views may simply be a matter of lag - voters may change their views as the state of the nation's economy becomes clearer.

However, if inflation continues to be a major problem and Americans rate the economy poorly, that could prove to be a major issue in the upcoming midterm elections.

Biden Delivers Remarks at the White House
U.S. President Joe Biden delivers brief remarks before a meeting with his coronavirus response coordinator Jeffrey Zients and members of the White House COVID-19 Response Team in the State Dining Room at the White House on December 9, 2021, in Washington, DC. Americans remain pessimistic about the economy despite many positive indicators. Chip Somodevilla/Getty Images