2008 vs. Today: Why we’re more pessimistic about the economic situation now

Global attitudes about the state of the economy amid the coronavirus outbreak are more negative in some countries than they were during the Great Recession, according to Pew Research Center surveys conducted in 10 countries during both crises. But people are also more upbeat about the prospect of a rebound than they were after the financial meltdown more than a decade ago.

In April, the International Monetary Fund predicted the economic downturn resulting from the coronavirus outbreak would be far graver than the Great Recession. With global gross domestic product now expected to contract by 4.9% in 2020, the magnitude of this recession exceeds that of 11 years ago, when year-on-year global GDP growth contracted by 0.1%.

Across the 10 countries Pew Research Center surveyed in both 2020 and 2008 or 2009, a median of 80% now say their country’s economy is faring badly, compared with a median of 72% who said the same in 2008-2009. However, there is considerable variation by country.

In four nations – Australia, Spain, Italy and the United Kingdom – significantly more now say the economic situation in their country is bad than did during the last recession. In Australia, for example, economic attitudes are more than twice as negative in 2020 as they were in 2008.

By contrast, South Koreans and Americans are now less discouraged by their countries’ economic situation than they were in 2008, although by smaller margins.

In Canada, Germany, Japan and France, the shares who gave their countries’ economies low marks in 2020 are roughly the same as those that had negative assessments in 2008.

In many countries, positive attitudes about the economy dropped more steeply after the coronavirus hit than during the Great Recession

In many countries, optimism about economic recovery is more widespread now than during the financial crisis

In nine of the countries for which Pew Research Center has polling data for 2007, 2008 or 2009, 2019, and 2020, positive assessments of national economies between 2007 and 2008-2009 fell by a median of 15 percentage points. Between 2019 and 2020, the median decline expanded to 27 points.

In five countries, the downturn in positive assessments of economic conditions during the coronavirus outbreak outdid the decreases seen between 2007 and 2008. In Germany, South Korea, Japan, Italy and France, assessments of the national economy slumped more during the current economic downturn than in the Great Recession. In some of these countries, the declines seen between 2007 and 2008 were the start of a longer downward trend in economic attitudes, as many of the countries were affected by the European debt crisis. Germany, for instance, saw a relatively modest drop in the shares who rated the country’s economic performance positively between 2007 and 2008, but in 2009, that share plunged to an all-time low of only 28%.

By contrast, the decline in British views of their economy was steeper between 2007 and 2008 than between 2019 and 2020 by 10 percentage points, and there too, assessments grew increasingly negative in the years immediately after 2008.

In three countries – the United States, Canada and Spain – the current downturns in economic attitudes mirrored those seen during the Great Recession. However, in Spain, economic attitudes continued to deteriorate after 2008, as the country became increasingly affected by economic decline spurred by the debt crisis.

In many countries, optimism about economic recovery is more widespread now than during the financial crisis

On balance, publics are much more optimistic in 2020 about their national economies improving over the next 12 months than they were in 2008.

Economic optimism has improved the most in Spain, where 48% say they expect conditions to improve over the next year compared with only 18% in 2008. In seven of the eight countries surveyed during both years, economic optimism increased. But a smaller share of people in South Korea, which was an early epicenter of the pandemic, say they expect economic conditions to improve now than did in 2008.

These differences in attitudes are fairly consistent with expert predictions about recovery. In June 2020, the IMF estimated the global economy would rebound from the 4.9% contraction predicted for 2020, with global GDP estimated to grow by 5.4% – not entirely making up the loss projected for 2020, but recovering at an even clip. By contrast, in April 2008, just before the 2008 survey, they expected the global economy to fall into a recession by 2009.