In the 12th episode of McKinsey’s Future of America podcast, host André Dua is joined by Chris Jackson and Mallory Newall from Ipsos to discuss how Americans are feeling about economic well-being, using the latest release of the American Opportunity Survey to highlight key insights on opportunity, employment, inflation, childcare, and physical and mental health and to explore how sentiment on these issues looks across various demographics. The following is an edited version of their conversation.
André Dua: Welcome to the 12th episode of McKinsey’s Future of America podcast, where we’ll explore how we can build a future that drives sustainable and inclusive growth. I’m your host for today, André Dua. I’m a senior partner with McKinsey and the managing partner of our Miami office.
Today I’m joined by Chris Jackson and Mallory Newall. Chris is a senior vice president for Ipsos. His research specialties include public opinion trends, election polling, strategic communications, and reputation. Mallory is a vice president for Ipsos, where she specializes in issues-based research, examining public opinion trends, and designing surveys for public consumption. Chris and Mallory, welcome and thanks for being here today.
Chris Jackson: It’s great to be with you.
Mallory Newall: Glad to be here.
André Dua: Before we jump in, can you tell listeners a little about each of your backgrounds?
Mallory Newall: Sure, happy to. I have been at Ipsos for the past five years, working closely with my partner-in-crime, Chris. As you mentioned, we do a lot of public-facing polling here in the US. Prior to that, I cut my teeth in research in political polling. I am currently based in Washington, DC.
Chris Jackson: I have been doing research for about two decades. I currently lead our public opinion research practice in the United States. Ipsos is part of a large global company, and I am also on the global committee that oversees a lot of our work that crosses borders. Our real mission is about elevating the voice of the people, helping bring what regular folks care about, what they’re concerned about, into the discourse, into the debate so that they’re heard in addition to all the experts and pundits and talking heads out there.
André Dua: That is a great segue to where I’d like to take the conversation. Speaking of how regular Americans feel, let’s start by talking a little bit about the work that we at McKinsey do together with Ipsos on the American Opportunities Survey, which is a survey of 25,000 Americans in which we explore their attitudes toward economic opportunity and inclusion, their economic well-being, and some of the key barriers they face in the workforce.
I think this is an especially important topic right now with so much conversation around the potential for recession, the impact of inflation, employment opportunities, and more. So let me start, Mallory, by asking, how do you think Americans feel about their economic opportunity right now?
Mallory Newall: That is a really important question for this moment. One of the key findings of this most recent survey, in a word, was pessimism about accelerating inflation, about rising gas prices. And at the time that we fielded this survey, the conflict in Ukraine was really ramping up. Tying that all together, this survey touches on this overarching concept of the “American dream” and if it is attainable for people. And what we’re seeing now, more so than last year, is that, for many, access to opportunity is out of reach.
Spending more on less
André Dua: What do you think is driving that feeling that the dream is perhaps slipping away?
Mallory Newall: I think for many people it really is about inflation, kind of setting aside sort of the official numbers about unemployment. Unemployment is relatively low right now. There’s a lot of hiring going on. People are really focused on the pocketbook, or the “kitchen table” issues. I think that’s what’s really driving it. They’re having to spend more on essentials. There’s sort of less to go around. This is all really starting to weigh on people. And more people than last year believe that the country as a whole is doing a poor job of providing opportunities for people, I think, because of those pain points that they’re feeling from an economic perspective.
People are really focused on the pocketbook, or the ‘kitchen table’ issues. They’re having to spend more on essentials. There’s sort of less to go around. This is really starting to weigh on people.
Chris Jackson: There is also a little bit of a self-fulfilling prophecy in some of these things, where people hear negative economic news, negative economic information, and that feeds into their outlook. We have seen a lot of places where people’s view of the economy is driven by noneconomic factors.
One of the factors that’s been given a lot of coverage recently is politics, where your political persuasion—who’s in power in Washington—has a huge impact, even if your actual pocketbook, your job, everything else are the same. Those changes have a huge impact on how people view the economy. So, there’s a little bit of column A and a little bit of column B driving it.
André Dua: Let us talk a little bit more about inflation because it does seem the topic of the moment. How do you think inflation is weighing on Americans right now?
Mallory Newall: One thing that I think this research illustrates is that there’s actually a lot of common ground in this diminished optimism. When you compare these findings to where people were at last year, it’s sort of across the board that the mood has just dampened a little bit. Some people are feeling it more acutely. We see that women and trans or nonbinary people are feeling this more than men, as are people who live outside of urban areas and people without a college education.
One thing that really stands out is that when we’re in a period of people having to spend more on the essentials—if you’ve got less money to go around to begin with or if you’re sort of up against a greater struggle to begin with—then this is sort of a compounding factor and even more strain. Like Chris said, I think there’s a lot of external factors at play here, but it’s really about money coming in versus money going out.
Tale of two economies
André Dua: Chris, you said something that I’ve been thinking about, which is that there are a range of economic factors which still look pretty good. Americans’ savings are at their highest point, unemployment is near historic lows, wage growth is pretty substantial, more so for people in lower-income categories. In some of those categories it’s outstripping inflation. And yet, overall sentiment is down. Mallory, you began to talk a little bit about difference in sentiment across demographic groups and you mentioned, in particular, women and transgender people. Can you talk a little bit more about some of the differences you’re seeing in demographic groups?
Mallory Newall: Absolutely. You all coined it really well in the report: this is a tale of two economies. Despite the positive things that are happening for some people, they’re just not seeing it. They’re not feeling it. And when you look across demographic groups, what we’re seeing is that the outlook overall has gotten a little bit more negative compared to last year.
Folks who are really driving it are the middle generations—older millennials, Gen Xers—more so than younger people. You touched on gender also: the diminished optimism is really felt particularly, I think, by women. That goes for both White women and women of color but also people who live in rural areas. That’s one area where we’ve really seen, compared to our previous survey results, a pretty significant decline in their optimism about the future of America and opportunity for them.
Chris Jackson: Rural residents are hit hard in a number of ways, but principally by gas prices. If you live in a rural area where you have to put a lot of miles behind you to get anywhere, high gas prices have more of an outsize impact than they do if you live in a city and can walk to accomplish a lot of what you need to do in your day-to-day life. So, in addition to not having a lot of opportunities in rural areas, high gas prices double down on some of the pain they’re feeling.
André Dua: Chris, what are the factors that are really contributing to Americans’ outlook? There always seems to be a few things which maybe occupy an outsize role in setting of sentiment, and historically for Americans that’s been gas prices. There has been significant public discussion about gas prices around July 4th. So, what do you both see are the contributing factors that are influencing Americans’ view that the “dream” is perhaps slipping away or that there’s less economic opportunity for them and their fellow Americans?
Chris Jackson: That’s a great question and it has a multipart answer. Gas prices always have a huge impact on people’s outlook on the economy. I think it’s outsize beyond the actual impact on their budget. Your typical household spends about $100 a month on gasoline versus $1,500 on rent and several hundred on food. I think with gas prices, because you see those numbers when you fill up your car every week or every couple of days, you see how much it costs. You see those numbers ticking up. The changes are real in a way that other changes are not. Your rent maybe goes up or down every six months or every year, your mortgage even less frequently. That may have a bigger impact but is less in your face. Our survey found that food and gas were the two things that were really driving people’s increased spending. All the data suggests these are the two factors that have been driving the inflationary pressures for Americans.
The other question about the American dream is a bigger and a more complicated one. We have data that Ipsos has done going back over the last decades showing that Americans are relatively pessimistic about the ability to achieve the American dream even before the pandemic and this current inflationary period. So, I think that sort of speaks to a larger challenge we’re facing as a society regarding giving people those opportunities to accomplish a dream or live up to the American dream.
André Dua: Mallory, is there anything you would add to that?
Mallory Newall: There’s other things at play that Chris started to allude to, which is that we are living in a society right now that is highly polarized. That’s not necessarily a new finding, right? That’s not something that happened overnight. It is a highly polarized society, where people are becoming more and more entrenched on either side of the political aisle or sort of in their own affinity or identity groups. And we’re coming out of two and a half years of a pandemic and of increased social isolation, where you are not able to make connections with other people around you.
When you take these feelings of isolation and polarization and then compound that with paying more at the gas pump, paying more for groceries, it’s some of those pain points that are really visible for people when they’re already sort of feeling like the world is a tough place to begin with, they kind of become compounding factors.
André Dua: Since you’ve seen this play out because of your research over a number of years, I’m curious if there’s anything in the most recent findings from the Opportunity Survey that surprised you, or what was most surprising?
Chris Jackson: I am always struck by the disconnect between how people talk about their actual, personal conditions in any given moment in time and their broader outlook. Most people report that they’re feeling pretty OK about their lives, their positions, their livelihoods, their opportunity. Even while they say that the country or the world is going down the tubes—and it’s not new, this is something that’s been happening for a while—there is this constantly fascinating mismatch between people who are pretty happy with what’s going on in their personal lives and just deeply, deeply unhappy with the direction of the world.
Mallory Newall: One thing for me that is particularly striking, and maybe it’s just because it hits close to home, are some of the questions around mental health. In our survey we see that nearly three in five respondents who have kids in the house—children under 18 at home—say that their mental health affected their ability to perform their work effectively.
There’s so much conversation happening right now, both in the survey and just in the public writ large, about the economy and about inflation and about this level of pessimism. I think it’s important to remember that it wasn’t too long ago that it was COVID-19 that was the big elephant in the room and that single issue that Americans were focused on. I think we are seeing the lingering effects here, both in terms of how mental health might be a little diminished but also, if you want to put a more positive spin on it, maybe how we’re talking about it more now and how our mental health affects how we show up at work and how we show up in our daily lives.
André Dua: That was really shocking to me, the breadth of the sentiment around mental-health issues. It really made me feel like we’re truly in the middle of a mental-health crisis in America, which is impacting people’s ability to perform at work as well.
Something worth noting is that we surveyed 25,000 Americans this year. One thing that people have been talking about is the ability of people who do polling to create representative samples. This obviously plays more on the political side, where it’s been harder to accurately predict people’s voting sentiment. Can you talk a little bit about what Ipsos does, and did do with this survey, to ensure a diverse sample that provides a representative cross-section of America?
Mallory Newall: That “political horse race” polling is just one facet of what we do as researchers. One of the reasons why I love surveys like this so much is that it’s a deep dive into the issues at hand for the American public and what’s important to them outside of the political sphere.
Since 25,000 is a significant number of interviews, we make sure that we put quotas in place on census data—gender, age, region, race, and ethnicity—to make sure that we get a really good cross-section of the American public and that this survey looks like how the country looks. We also did some oversampling or boost interviews in major metro areas around the US, which allows us to not only look at Americans as a whole but also to look at people in different areas, in different cities, across the country to provide a really rich picture of what Americans look like and of what people in different areas of the country are really feeling right now.
Chris Jackson: It allowed us to, for instance, talk about the country as a whole but then also look at how opportunity may be different for people living in the Washington, DC, metro area where Mallory and I are versus the Miami metro area where you are, because there are so many local conditions that drive these things. And this big survey with these big samples in cities helped us do that.
André Dua: Chris, in addition to the American Opportunities Survey, Ipsos also surveys Americans in its monthly What Worries the World Survey, which is done twice a year across more than 25 countries. I think those surveys also find that Americans’ optimism has significantly declined and just 15 percent of Americans say they have more economic opportunities now than 12 months ago. What more are you seeing in these surveys? And how do the views of Americans differ, if at all, from those citizens elsewhere around the world where you’re conducting surveys?
Chris Jackson: Of the many pieces of research we do, one is this monthly global adviser survey that we do in 26, 27 countries around the world, of which every six months a wave is dedicated to the What Worries the World Survey that we’ve been running for about a decade now, where we ask people what their main issues are, what their main concerns are.
And we found, like you just talked about, that Americans are certainly on the downturn with their views of the world, their pessimism. We are not unique in that regard. We’re seeing that same phenomenon playing out pretty much everywhere around the world, particularly in Europe, in the industrialized democracies that are closest to us in terms of the position on the economic cycle.
So, while the United States is oftentimes unique in its outlook and its behavior, in this regard we’re actually feeling some of the same pains as everyone else, including our friends in Europe, even our friends in Asia and Africa.
André Dua: Looking forward, what do you both think, reflecting on this survey, are some of the issues to watch?
Chris Jackson: There’s so much change right now that there’s a lot of trends to watch out for. One of the things that this survey highlights is how and where we work. There’s this huge appetite in the American public, the American workforce, for things like remote work or hybrid work or the ability to have a little bit more control about where they spend their day, and I think it’s not necessarily going to go away now that the pandemic’s kind of becoming the new normal. We just don’t know exactly where normal is going to settle down.
While the United States is oftentimes unique in its outlook and its behavior, in this regard we’re actually feeling some of the same pains as everyone else, including our friends in Europe, even our friends in Asia and Africa.
Mallory Newall: We are in this really transformational period, I think. Employers that want to retain their employees are forced to look at things from a more holistic lens, right? We talked a lot about mental health in the workplace and the bigger conversation about the impact of your mental health on your daily life. I think it feeds into here too, per Chris’s point, how we work and where we work but also what the workplace looks like. And the tangibles—good pay, hours, etcetera—those are certainly important. Those aren’t going anywhere. Some of the more intangibles—such as how workers are feeling, the soft benefits of flexibility on where you work and when you work—those are critical too.
There is this sort of shift of power balance, I think, between employers and employees right now. Because there are so many companies that are hiring and employees are looking to make a move that best suits them, you really need to focus on some of those intangibles beyond money to attract and retain employees.
André Dua: I am glad you brought up this topic of remote work. I was really struck by the extent to which this seems to be becoming a feature of the economy. It was remarkable to me that 58 percent of the people we surveyed—which if you extrapolate means 92 million Americans—report having the option to work from home full time or at least part time.
That’s really significant. And of those people, if you take them in aggregate, they’re working on average about three days a week from home. So that’s a really significant change. As it relates to remote work, are there any differences you saw among different groups or types of workers that you think are noteworthy?
Chris Jackson: One of the interesting things from this data is that everyone’s interested in remote work, and it doesn’t really matter sort of the type of work they do. People are interested in it. Some of that relates back to some of the issues we talked about earlier, things like inflation and gas prices.
Working from home’s a great way to avoid paying more in gas, right? There are some interesting patterns in who’s more interested or taking advantage of remote work more: people working knowledge-economy jobs, people who live in cities, and men right now are slightly more likely than women to be taking advantage of some of these things.
I think some of that’s about who has the opportunity. If you’re doing a service job where you have to be in person to do that service, or construction, things like that, there are limits in how remote that work can be. It is something that everyone is kind of interested in right now.
André Dua: I was struck by this difference: more women than men would like remote work, but more men than women have the opportunity to work remotely. Another very interesting thing, Mallory, is what you alluded to, which is how high up on the list of criteria for jobs or job changes remote work has become. Maybe you could say a little bit more about that.
Mallory Newall: Absolutely. Our survey really clearly shows that job seekers truly value this autonomy over not only where they work but when they work. The most common rationale for a job hunt was a desire for greater pay or more hours and then a search for better opportunities.
The third most popular reason was looking for a flexible work arrangement. That’s working from home or the ability to bring a child to work with you. And there you see that reverse gender gap, where women are actually a little bit more likely than men to report a flexible working arrangement as a reason to seek a new job.
André Dua: Interesting. I’d like to pivot to what a lot of people are either thinking or worrying about now, which is the potential for a coming recession or a downturn. I’m curious to get your perspective. Chris, you alluded before that perception can create its own reality. I’d like to maybe build on that but also talk a little bit about the potential features of this downturn and how it differs from our last significant downturn, which was the financial crisis in 2008 and 2009.
Chris Jackson: The American economy’s a weird creature. People think of it as this big thing that includes train yards and factories and everything else. The biggest piece of the American economy is consumer spending, which means it’s susceptible to sort of what’s happening in consumer’s minds. If they decide they don’t want to spend anymore, all of a sudden we see an economic downturn. There definitely is almost a psychological aspect of what’s going on with the economy. This year is a little bit different than our last major economic downturn, the Great Recession that came after the fallout with the housing market.
In that period people were very, very concerned about jobs and employment. That was what people’s focus was on. Unemployment did go up significantly. I think it peaked around 10 percent at the worst point in the Great Recession. And inflation was never an issue. There’s cost of living, of course, if you didn’t have a job, but for everyone else that was not a big concern. That’s a bit flipped now, where people are not really worried about their jobs or their job security, but they’re much more concerned about their ability to afford their household goods, pay their basic living expenses, because it’s this different period.
What that suggests is that in the Great Recession there was a smaller group of people that were impacted much more strongly, people who lost their jobs, and then all of the people who lost money in the market from the crash. This time the pain is being felt much more widely because everyone’s paying for increased prices, even as no single group—maybe excluding cryptocurrency—is feeling extra-strong personal damage due to the market.
André Dua: The last thing I wanted to ask you was based on all the research that you’ve conducted and all the work you’re doing, what are the important issues that we’re not talking about in the public arena enough, but that Americans are deeply concerned about?
Mallory Newall: I think it is being talked about but one thing that continues to percolate is crime and safety, how safe you feel in your community, and a sense of security around that. So, it goes beyond economic security. And going back to my comments earlier about how polarized we can be as a society, people are approaching the issue of public safety a little bit from a different lens. It is something, of course, with increased gun violence and mass shootings as of late, that I think remains top of mind. As we get closer to November, I’m just going to be watching—we know that the economy and inflation is the issue of the day right now.
Will that trend hold, or will there be other issues, like safety, like healthcare or abortion that creep into the public consciousness? Is that enough to make a difference? Or is it going to be something similar to what we saw in 2020, where it was really a single issue that defined the moment? Then it was COVID. Now is it going to be the economy?
Chris Jackson: I think inflation definitely is the big thing. It’s the dominant issue in just about every survey we do right now. The question is if inflation comes down what fills that space. I think there are a lot of potential issues out there. Climate change and sustainability are definitely things that we’ve seen increasing in importance every year, and they’re still second-tier issues for the American public. They’re not dominant like inflation or healthcare or the pandemic was two years ago.
Ever so slowly, much like the global temperature, it’s going up as a major issue. Crime and public safety: huge concern. That’s more of a perennial thing. People have always been concerned about crime and public safety.
I also think one of the other issues that is increasingly dominant in the American psyche is partisanship, political division, social division. People feel like the country is very divided right now. I think that’s feeding into some of the problems you’re seeing in the economic climate; people are reading that angst from the political division into their views of the economy, which I think makes those views a little bit more pessimistic.
André Dua: Perhaps let me add one, and I’m going to put them under the broad category of health-related issues. I think what’s coming through in this survey of 25,000 Americans is—as Mallory said—the extent to which mental health has reached really significant proportions.
Related to that, the survey also says a lot about the number of people who feel their physical health is impacting their ability to work to their full potential. It’s also very clear that childcare remains a significant barrier, particularly to women’s participation in the workforce.
Last, the survey reminds us that the number one issue that Americans say is a barrier to their economic opportunity is access to healthcare and health insurance. So even though that’s been part of the policy dialogue for 20 or 30 years, Americans are telling us this is still the biggest barrier to personally accessing economic opportunity.
Chris Jackson: That is a fantastic point. There’s definitely this achieving-the-American-dream thing. People feel it’s harder to obtain. And that’s a big piece of the barrier people see, is that risk of some catastrophic healthcare expense.
Considering a sustainable and inclusive future
André Dua: We are going to wrap up our Future of America episode as we always do with some rapid-fire Q&A. Mallory, I’m going to ask you just a couple questions first. Is there a book or article that you’ve recently read that excites you as we think about how to create a more sustainable and inclusive future for Americans?
Mallory Newall: That is an interesting question. Perhaps excite isn’t the right word, but one thing that I’ve really been fascinated by recently is the impact of climate change specifically on migration patterns in the US. I am a native Michigander and I read something recently about the Great Lakes region or the upper Midwest becoming a potential destination for “cli-migrants”—in one of the articles that I read, that is the word they used—people who are moving from the Deep South or from the West, areas that are prone to droughts, moving to areas in Michigan and Ohio. I think that’s a bigger trend that really interests me: How is climate change going to actually shift demographic and regional patterns and population patterns in this country, both in the near and far term?
André Dua: Mallory, one last question for you. What makes you optimistic that we can achieve a more sustainable and inclusive future for Americans?
Mallory Newall: I love it, ending on a positive note. I’m going to hearken back to my comments on mental health. I feel the same about sustainability: I feel that we are in a time where people are just talking about it more. The dialogue is happening.
Particularly when you look at younger generations, Gen Z, younger millennials, sustainability and climate change are certainly a focus for them. That gives me hope, that it’s becoming part of the consciousness and that younger folks are looking to carry that torch to hopefully save our world from catastrophe.
André Dua: Chris, is there a book or article that you’ve recently read that you’ve found interesting in terms of this broader topic of creating a more sustainable and inclusive future?
Chris Jackson: As a public pollster, I’m supposed to have at least some awareness of everything at any given point in time, so I read a lot. A book that I read recently that I found really interesting and positive was Bill Gates’ recent book on avoiding a climate catastrophe. It had some very real talk about what’s going on broadly with climate change but some very real steps that can be taken that are achievable to prevent the worst of it. I thought that was a good book that had some good, useful, not totally dire forecasts of the world.
André Dua: Thanks. My last question is, what makes you optimistic that we can achieve a more sustainable and inclusive future?
Chris Jackson: Again, I’m a public pollster. I spend my day asking questions of the American public. The stuff that tends to get the most attention is the inflammatory stuff. It’s the things where somebody believes something crazy. There’s some huge difference between groups. The truth is in question after question after question we ask, particularly when you take out some of the more charged language, some of the buzzwords, some of the political labels, you see most Americans are on the same page about a whole host of issues.
There’s so much commonality in the society that gets lost because it’s not as sexy for the conversation. It does give me a lot of hope that there is a fundamental basis of commonality we have as Americans that we can build on and make a better future.
André Dua: Thank you, Chris and Mallory. That was Chris Jackson, senior vice president for Ipsos, and Mallory Newall, vice president for Ipsos. I’m André Dua. You’ve been listening to McKinsey’s Future of America podcast series. Thanks for joining us.