The election of Donald Trump has brought with it a surge in optimism in the United States over the economy and stocks not seen in years.
The CNBC All-America Economic Survey for the fourth quarter found that the percentage of Americans who believe the economy will get better in the next year jumped an unprecedented 17 points to 42 percent, compared with before the election. It’s the highest level since President Barack Obama was first elected in 2008.
The surge was powered by Republicans and independents reversing their outlooks. Republicans swung from deeply pessimistic, with just 15 percent saying the economy would improve in the next year, to strongly optimistic, with 74 percent believing in an economic upswing. Optimism among independents doubled but it fell by more than half for Democrats. Just 16 percent think the economy will improve.
“We’re looking at America moving into a more positive era with regard to economic expectations,” said Micah Roberts, vice president at Public Opinion Strategies, which serves as the Republican pollster for the CNBC survey. “No doubt the election of Donald Trump has ushered that in.”
The poll of 800 adults around the country was conducted Dec. 2 to 5, and has a margin of error of 3.5 percentage points. Hart Research Associates served as the Democratic pollsters.
A majority of Americans tell CNBC they are “comfortable and prepared to support” a Trump presidency. The 56 percent of respondents who now back the president-elect represent a sharp change from the 43 percent who were asked the question just before the election in November by NBC News and The Wall Street Journal. The percentage is driven by 91 percent of Republicans supporting Trump but also 54 percent of independents and even 23 percent of Democrats.
The survey showed a rise in optimism when it comes to several key economic gauges. Americans now look for higher wage gains next year and bigger increases in their housing prices.
The post-election surge in major stock market indexes also has buoyed feelings about equities, with 40 percent saying now is a good time to invest, up 10 points from before the election. Again, Democrats became somewhat more negative on stocks while Republicans grew significantly more optimistic.
Those differences are also clear in the choice for what Americans believe is the best investment right now. While real estate remains the top choice for the third straight year, stocks gained the most ground at the expense of gold, real estate and Treasurys. Driving the change: the shine is off gold for Republicans and they, along with independents, have grown more favorable toward equities.
Nearly every demographic, except the poor and Democrats, now has a net positive view about investing in stocks.
But the survey shows the president-elect has his work cut out for him. Asked which one or two items Trump should focus on first, a 40 percent plurality answered, “Keeping U.S. jobs from going overseas.” All other priorities were far back and it was the top choice for all parties, but especially the GOP.
“Among Republicans, there’s keeping jobs from going overseas and then there’s everything else — it’s really all about jobs and keeping jobs in the U.S.,” said Democratic pollster Jay Campbell with Hart.
The second-most popular priority was increasing the minimum wage, which has strong support from Democrats and independents. The conundrum for the incoming president is that keeping jobs from moving overseas could, in some cases, mean lower wages for Americans.
Coming in third among priorities was reducing the deficit, a strong choice among Republicans and independents, followed by funding infrastructure, boosted by Democrats and independents. Again, these two priorities are potentially in conflict since infrastructure spending would boost the deficit.
A potential warning to the president-elect comes from two priorities he has discussed at length, business tax cuts and deregulation. Both come in far down the list among priorities for the public, with modest independent support and little backing from Democrats.