The WalletHub Economic Index increased slightly (1%) between May 2022 and May 2023. This means consumers are marginally more confident about their financial outlook this month than they were at the same time last year.
The WalletHub Economic Index is a monthly survey that evaluates economic prospects based on 10 components of consumer sentiment. These components revolve around how people feel about their finances, purchasing plans and employment opportunities.
Main Findings
Change in WalletHub Economic Index: May 2023 vs. May 2022
| Economic Index | Change |
|---|---|
| Positive sentiment about current employment opportunities | -7.1% |
| Positive sentiment about debt levels in the next 6 months | -2.8% |
| Confidence in having a job in 6 months | -1.1% |
| Positive sentiment about credit score in the next 6 months | -1.0% |
| Positive sentiment about finances now | 0.5% |
| Positive outlook on finances 6 months from now | 0.8% |
| Stress level about money now | 3.2% |
| Likelihood of making a big purchase in the next 6 months | 5.9% |
| Likelihood of buying a car in the next 6 months | 7.0% |
| Likelihood of buying a home in the next 6 months | 11.1% |
| Overall WalletHub Economic Index | 1.34% |
Detailed Findings
- Year-over-year, consumers felt relatively more confident about their financial outlook in May 2023, with the value of the overall index registered being slightly higher (1%) than in May 2022.
Overall
- Slightly increased financial optimism: In May 2023, consumers’ optimism about their finances recorded a slight decrease from the previous month. At the same time, the level of optimism increased marginally (+0.5%) in the past year.
How do you feel about your finances right now?
Note: The higher the value, the more optimistic people feel about their finances.
- Increasing stress: Consumers’ stress levels regarding money are worse (3.2%) in May 2023 compared to the same period last year.
How do you feel about money?
Note: The lower the value, the less stress people feel about money.
- Slight increase in optimism: In May 2023, consumers’ optimism about whether their finances will improve in the next six months is only slightly higher (+0.8%) than it was last year.
How will your finances look 6 months from now?
Note: The higher the value, the more improvement people expect for their finances.
- Fewer new employment opportunities: The share of consumers who feel new employment opportunities are “abundant” is over 7% lower in May 2023 compared to last year.
How would you describe current employment opportunities?
Note: The higher the value, the more abundant people think employment opportunities are.
- Weak sense of job security: People’s confidence in having a job in the next six months is slightly lower (1%) in May 2023 compared to last year.
How confident are you that you will have a job in 6 months?
Note: The higher the value, the more confident people are they will have a job.
- Real estate popularity rises: Home-buying interest among consumers increased considerably over 11% during the past year, hitting the second-highest value recorded since December 2020.
How likely are you to buy a home in the next 6 months?
Note: The higher the value, the more likely people are to buy a home.
- Rising interest in auto purchases: The share of consumers who expect to buy a car in the next six months rose by 7% in May 2023 compared to last year.
How likely are you to buy a new car in the next 6 months?
Note: The higher the value, the more likely people are to buy a car.
- Large purchases are a priority: In May 2023, consumers’ likelikood of making a large purchase in the next six months is roughly 6% higher than it was last year.
How likely are you to make a large purchase within the next 6 months?
Note: The higher the value, the more likely people are to make a large purchase.
- Weakening debt-reduction confidence: The share of consumers who expect to have less debt after the next six months is about 3% lower in May 2023 compared to last year.
Will you have more or less debt in 6 months?
Note: The higher the value, the more confident people are that they will reduce their debt.
- Credit score insecurity: The share of consumers who expect their credit score to increase in the next six months is slightly lower (1%) in May 2023 compared to last year.
Will your credit score be better or worse in 6 months?
Note: The higher the value, the more confident people are that they will increase their credit score.
Ask the Experts
In order to gain more insight into consumer attitudes during a difficult year, WalletHub turned to a panel of experts. Click on the pictures of the experts below to read their bios and responses to the following key questions:
- Why is consumer confidence going down overall?
- In what ways has the recent banking crisis affected the financial decisions of households and businesses?
- With the ongoing uncertainties in this economy, what steps can individuals take to protect their personal finances
Ask the Experts
CFA, Ph.D. – Professor of Finance – Saint Joseph’s University
Read More
Professor of Finance, Monfort College of Business – University of Northern Colorado
Read More
Rudd Family Foundation Professor of Finance, Haas School of Business – University of California, Berkeley
Read More
Ph.D. – Faculty, Finance Department – University of the Incarnate Word
Read More
Ph.D., CFA – Professor of Finance – University of Puget Sound and Founder, Four Horsemen Investments
Read More
Ph.D. – Associate Professor of Economics, Title IX Deputy Coordinator – University of North Georgia—Oconee
Read More
Methodology
The WalletHub Economic Index is based on a nationally representative online survey that WalletHub conducts monthly. There has been a total of nearly 7,200 respondents between December 2020 and May 2023.
WalletHub Economic Index Questions
- How do you feel about your finances right now?
Pessimistic 1 2 3 4 5 Optimistic - How will your finances look 6 months from now?
Much Worse 1 2 3 4 5 Much Better - How do you feel about money?
Very Stressed 1 2 3 4 5 Not Stressed - How confident are you that you will have a job in 6 months?
Not confident 1 2 3 4 5 Very confident - How would you describe current employment opportunities?
Limited 1 2 3 4 5 Abundant - How likely are you to buy a home in the next 6 months?
Not at all likely 1 2 3 4 5 Very likely - How likely are you to buy a new car in the next 6 months?
Not at all likely 1 2 3 4 5 Very likely - How likely are you to make a large purchase within the next 6 months?
Not at all likely 1 2 3 4 5 Very likely - Will you have more or less debt in 6 months?
More debt 1 2 3 4 5 Less debt - Will your credit score be better or worse in 6 months?
Worse 1 2 3 4 5 Better
