Poll shows signs of economic optimism, but inflation concerns rise

Americans are increasingly bullish about the state of the U.S. economy, but concerns about inflation are on the rise, according to a new Harvard CAPS-Harris Poll survey released exclusively to The Hill.

Fifty-six percent of respondents say they believe the economy is strong, continuing a steady rise since January, when just 45 percent said as much. 

Likewise, the number of Americans who say their personal finances are improving is also on the rise. Thirty-three percent reported a brightening financial outlook in the most recent Harvard CAPS/Harris Poll survey, up from 28 percent in January. Meanwhile, the number who say their personal financial situation has worsened has dropped from 27 percent in January to 23 percent in May.

At the same time, more people say the economy is on the right track than the wrong track — 47 percent to 42 percent. 

The optimistic outlook comes amid a series of positive indicators that the U.S. is pulling itself out of the midst of the worst pandemic in roughly a century. New COVID-19 cases have plummeted to their lowest level in nearly a year, and more than 60 percent of U.S. adults have received at least one dose of a COVID-19 vaccine so far.

Still, Americans are growing concerned about inflation, which accelerated at its fastest rate in April in more than a decade. The consumer price index, which measures prices for a variety of consumer goods as well as housing and energy costs, rose 4.2 percent over the past year.

An overwhelming 88 percent of respondents said they are concerned about inflation, according to the Harvard CAPS-Harris Poll survey, including 41 percent who said they are “very concerned” about it. For most Americans, inflation means an increase in the price of basic goods such as groceries, driving the value of money down and leading to more economic uncertainty.

A plurality of respondents — 39 percent — say they blame increased government spending under the Biden administration for inflation, while another 37 percent believe that massive cash injections into the economy by the Federal Reserve are behind rising prices. 

“There is concern that the Biden investment programs may accelerate inflation and so the administration has to move carefully here,” Mark Penn, the director of the Harvard CAPS-Harris Poll survey, said.

The vast majority of respondents — 82 percent — also believe there are many jobs that are currently unfilled, and many blame expanded unemployment benefits for the labor shortage, according to the poll. 

Seventy-six percent overall say that some people are not returning to work because they are able to collect more from unemployment than they can make in a job. At the same time, 54 percent of respondents want the extra unemployment benefits to end in July, as opposed to later this year or early next year.

Congress approved a $300-per-person unemployment supplement in December and recently extended those additional payments through early September. But after a lackluster jobs report this month, critics of the expanded unemployment benefits have called to end them, arguing that they are disincentivizing people from returning to work.

A handful of GOP-led states have already moved to wind down the supplement prematurely. Florida became the latest state to do so, announcing on Monday that it would end its participation in the federal program.  

“There is growing belief that the economy and the lives of Americans are improving and nearly nine in 10 believe that there are more jobs than people right now,” Penn said. “There is widespread belief by voters in both parties that unemployment benefits are holding people back from working in an economy in danger of inflation.” 

The Harvard CAPS/Harris Poll survey of 1,945 registered voters was conducted from May 19 to May 20. It is a collaboration of the Center for American Political Studies at Harvard University and the Harris Poll.

Full poll results will be posted online later this week. The survey is an online sample drawn from the Harris Panel and weighted to reflect known demographics. As a representative online sample, it does not report a probability confidence interval.