New Citi Survey Finds Chicagoans’ Outlook on Recovery Dims: 60% Believe Economy Has Not Hit Bottom

A new survey issued today by Citi, and conducted by Hart Research Associates, reveals that even though the number of Chicago residents who feel that they are better off today than in September 2009 has risen slightly (up three points to 16 percent), their outlook on the local economy, the economic recovery and their own personal financial situation is not as bright as it was just nine months ago.

The survey found that three in five (60 percent) Chicago residents believe the economy has not yet hit bottom, compared with 62 percent nationally. This is a meaningful eight-point negative turn in attitudes since September when about half (52 percent) of Chicago residents believed we still had a ways to go and 34 percent said we had already hit bottom.

When it comes to local economic conditions and their own personal financial situations, Chicago residents are equally dour.

• Only 53 percent of Chicagoans believe that local business conditions will get somewhat (47 percent) or much (6 percent) better in the next 12 months – a 14-point decline since September.
• 63 percent of Chicagoans are somewhat (47 percent) or very (16 percent) optimistic that their own financial situation will get better over the next 12 months – a seven-point decline since September.
• Only 22 percent of Chicagoans believe their local economy is good or excellent – a six-point decline since September.
• 64 percent believe it is only a fair (30 percent) or poor (34 percent) time to buy a major household item.
• More than half (55 percent) of Chicagoans say they will not take any vacation at all this summer, more than 51 percent nationally.

"Although we’ve had four consecutive quarters of economic growth, the Citi survey results clearly show that Main Street feels that the recovery has lost momentum,” said Jonathan Clements, Director of Financial Education, Citi Personal Wealth Management. "Consumers are still concerned about unemployment and a weak housing market. When you are concerned about finances on the home front, it may darken your broader outlook.”

"Sandwich Generation” Struggling Most with Debt

The survey found that, when it comes to debt, nearly two in five (38 percent) Chicagoans say that they are somewhat (24 percent) or very (14 percent) uncomfortable with their current level of debt, a six-point increase since September, and five points higher than the country overall (33 percent). One in four (26 percent) Chicago residents has at least one area of debt that constitutes a major or unmanageable problem.

• Health expenses cause the greatest concern (10 percent) followed by credit card debt (8 percent), student loans (7 percent) and mortgage debt (6 percent).

Chicagoans between the ages of 40 and 64, those representing the "sandwich generation,” report struggling the most with debt. In fact, 33 percent report having at least one kind of debt that constitutes a major or unmanageable problem, compared to 25 percent for those under age 40, and 14 percent for those age 65 and over.

• Of greatest concern is credit card debt (14 percent), health expenses (12 percent), and mortgage debt (9 percent).
• Chicagoans under age 40 reported slightly less concern, but are still struggling with student loans (10 percent) and health expenses (9 percent).
• Those age 65 and older reported feeling the least pain. Their biggest concern is health expenses (7 percent).

Chicago women report greater difficulty with various types of debt than men.

• 12 percent of women are concerned about health expenses becoming a major or unmanageable problem compared to 7 percent of men.
• Credit-card debt is the top concern for 8 percent of Chicago men, although it is also a problem for area women (9 percent).

Saving money for emergencies and unexpected needs was a top priority across all age groups, most notably the top priority for 30 percent of Chicago residents over age 65.

"The sandwich generation has a very tough challenge,” added Clements. "While they are paying for their children’s education and saving for retirement, they are often also caring for aging parents. This can create tremendous personal and financial stress, particularly if you don’t feel confident navigating the economic downturn.”

Half of Chicago Men Report Living the American Dream

Despite the current economy’s challenges, 45 percent of Chicagoans believe that they are living the American dream right now. Notably, while half (50 percent) of men say they are living the American dream right now, only 39 percent of women feel the same. However, when looking toward the future, 70 percent of men and 70 percent of women believe they are or will live the American dream. A little less than a quarter of Chicago residents (23 percent) report that they neither live the American dream now nor ever expect to.

Citi conducted this nationwide survey as part of its ongoing effort to better understand changes in the needs of the consumers and communities the company serves.

Survey Methodology

Hart Research Associates conducted the telephone survey of 2,005 adults nationally, including 451 adults in the Chicago MSA (218 men and 233 and women), from June 22-29, 2010. The Random Digit Dialed (RDD) survey has an overall statistical margin of sampling error of plus or minus 2.2 percentage points nationally and 4.6 percentage points in the Chicago MSA. The survey also included a panel of respondents who use only a mobile telephone.

About Citi

Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Through Citicorp and Citi Holdings, Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management. Additional information may be found at www.citigroup.com or www.citi.com.