Old North News

The government might still be in a state of denial, but two out of three average American voters describe the economy as being in a recession.

Rampant inflation, falling wages, two consecutive quarters of negative economic growth and high mortgage rates in North Carolina and across the country have combined to unsettle many Americans. Regardless of what the government calls it, Americans appear to be feeling the brunt of the country's poor economic conditions. 

"Sixty-four percent (64%) of voters say the U.S. is currently in a recession. A Scott Rasmussen national survey found that just 17% say it is not, and 19% are not sure," Scott Rasmussen reports. A month ago, a Rasmussen survey asked Americans the same question and 57% of voters responded “Yes.” 

Rasmussen's Number of the Day survey results also found that 73% of Americans say that over the past year, their income has been falling behind inflation. The survey's sample size was 1,200 registered voters and it was conducted online by pollster Scott Rasmussen on Sept. 15-17. The margin of error for the full sample is +/- 2.8 percentage points. 

A second poll shows that a majority are blaming Democratic policies for the fiscal woes. In a September Senate Opportunity Fund survey, 58% of Americans indicated they agreed with the statement, “Democrats’ runaway spending, punishing regulations and attack on American energy is hurting the economy and forcing the country into a recession.” Among self-described moderates, 52% blame uncontrolled spending by the Democratic administration. 

That poll took place Sept. 12-15 and surveyed 1,600 general election voters nationally. 

The Bureau of Labor Statistics (BLS) on Sept. 13 released the Consumer Price Index (CPI) data for the 12 months ending August 2022. The data showed an 8.3% all items annual increase, which represents a 0.1% rise from the month prior, on a seasonally adjusted basis. According to the BLS, real average hourly earnings for all employees declined 2.8%, seasonally adjusted, from August 2021 to August 2022. The change in real average hourly earnings combined with a decrease of 0.6% in the average workweek resulted in a 3.4% decrease in real average weekly earnings in the last year. 

As for economic output, the Bureau of Economic Analysis' (BEA) third estimate for quarter two, released Thursday, shows that the Gross Domestic Product (GDP) dropped 0.6% for the second quarter. That comes on top of a 1.6% decline in the first quarter of 2022. 

In simple terms, those numbers mean the U.S. economy is shrinking. As Business Insider points out, GDP's two consecutive quarterly declines signals "the U.S. is already in a technical recession, and supply bottlenecks from the pandemic are lingering in key markets.” 

Mortgage-finance giant Freddie Mac notes that the uncertainty and volatility in financial markets is heavily affecting mortgage rates. In the last five weeks, rates have jumped 1.57%. On Thursday, the average rate on a 30-year fixed-rate mortgage was 6.7%, Freddie Mac reported — 3.69 points higher than the rate at this time last year. 

North Carolina home buyers have to pay more interest, as Bankrate.com reports that the going rate for a 30-year fixed mortgage in North Carolina was 6.82% on Thursday.