2. 2Economic Recovery Index
Happy Birthday
We have been tracking the mood of the
nation with our Economic Recovery Index
for five years this month.
A lot has changed –on the economic and on
the consumer front – but not everything.
We have expanded this month’s commentary
to reflect on the past five years and to
analyse the economic situation of Irish
consumers in more detail in order to identify
those groups that are leading the recovery –
or lagging it.
Thank you to all our regular readers for your
feedback on the ERI over these past few
years, you have inspired us with lots of ideas
for improvement and expansion in the
months ahead.
3. 3Economic Recovery Index
The Emotional Recovery
We have been reporting our monthly
Economic Recovery Index since April 2009.
We set out five years ago to assess the
psychological impact of the recession and to
chart our ‘emotional progress’ towards
recovery alongside our ‘economic progress’.
This report summarises our Economic
Recovery Index results from April 2009 to
April 2014.
The most recent fieldwork was conducted
during 14th-21st April 2014 inclusive.
The full data series is on our website –
details at the end of this report.
5. 5Economic Recovery Index
Using the answers to the question on ‘stages of recovery’ we have created the Economic
Recovery Index, which ranges from 0 to 100 (0 = deep recession; 100 = back to peak).
Our Index eased back to 33.2 in April 2014, falling back from last month’s record level:
The Economic Recovery Index
Source: Amárach Research, April 2014
0
5
10
15
20
25
30
35
40
Apr'09
Jun
July
Aug
Sept
Oct
Nov
Dec
Jan'10
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'11
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'12
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'13
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'14
Feb
Mar
Apr
despite this month’s fall back, the ERI remains at historically high levels
6. 6Economic Recovery Index
A Matter of Measurement
Mar ’14: 19% Apr ’14: 23%
Mar ’14: 34% Apr ’14: 32%
Mar ’14: 36% Apr ’14: 35%
Mar ’14: 10% Apr ’14: 9%
Mar ’14: 1% Apr ’14: 1%
Every month we survey a representative, online sample of 1,000 adults and ask them to tell us
which one statement ‘best describes the economic situation in Ireland right now’ (listed below)
The percentage thinking ‘things are getting worse’ is the lowest since we began:
7. 7Economic Recovery Index
ERI Summary Table
Which one statement ‘best describes the economic situation in Ireland right now’?
% choosing each statement:
%
The economic
situation in
Ireland is
getting worse
The economic
situation is bad
but has
stabilized
The economic
situation is bad
but showing a
few signs of
improvement
The economic
situation is
getting better
and showing
clear signs of
improvement
The economic
situation is
good and
almost fully
recovered
Economic
Recovery
Index
Apr-09 77 14 8 1 0 8.3
Apr-10 38 34 25 2 1 23.8
Apr-11 51 27 19 2 1 18.2
Apr-12 49 27 21 3 0 19.4
Apr-13 46 29 22 3 0 20.3
Mar-14 19 34 36 10 1 34.7
Apr-14 23 32 35 9 1 33.2
the false dawn of recovery in 2010 has been replaced by a more viable one in 2014
8. 8Economic Recovery Index
Uneven Recovery
Which one statement ‘best describes the economic situation in Ireland right now’?
(by sex, age, class, Dublin)
Source: Amárach Research, April 2014
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
1000 494 507 169 223 187 156 265 279 477 523
The economic situation
in Ireland is getting
worse
23% 24% 21% 23% 19% 24% 21% 26% 20% 19% 26%
The economic situation
is bad but has stabilized
32% 35% 30% 30% 39% 31% 35% 27% 32% 33% 31%
The economic situation
is bad but showing a
few signs of
improvement
36% 32% 39% 38% 31% 36% 39% 37% 36% 35% 37%
The economic situation
is getting better and
showing clear signs of
improvement
9% 9% 9% 9% 10% 8% 5% 11% 12% 12% 6%
The economic situation
is good and almost fully
recovered from the
recession
1% 0% 1% 1% 2% 1% 0% 0% 0% 1% 0%
ERI Score 33.2 32.1 34.2 31.2 34.7 32.9 32.7 33.7 34.8 35.8 30.8
10. 10Economic Recovery Index
Consumer Sentiment Summary Table I
% agree strongly/slightly with selected statements:
%
Ireland will be
through the
worst of the
recession in
12 months
time
I feel I am
financially
comfortable
enough to
make it
through the
recession
I am optimistic
in spite of the
current
economic
situation
Right now it
seems like the
recession is
affecting other
people more
than it is
affecting me
Apr-09 34 48 57 59
Apr-10 43 47 52 53
Apr-11 24 39 47 48
Apr-12 31 42 51 50
Apr-13 25 35 40 44
Mar-14 37 40 49 45
Apr-14 35 40 49 43
despite signs of recovery, consumers feel more impacted by recession than before
11. 11Economic Recovery Index
Consumer Sentiment Summary Table II
% agree strongly/slightly with selected statements:
%
I am more
relaxed about
spending
money than I
was a few
months ago
I am saving a
lot more than
before
because of the
recession
My main
financial priority
is to pay off my
debts as quickly
as possible
I would be
happy to
borrow money
from a bank if I
need to
Apr-09 15
Apr-10 21 28 59 31
Apr-11 14 27 58 24
Apr-12 20 30 59 28
Apr-13 15 23 57 21
Mar-14 23 24 58 26
Apr-14 24 24 56 26
indicators of consumer spending & borrowing intentions are stable but not rising
12. 12Economic Recovery Index
Consumer Sentiment Summary Table III
% agree strongly/slightly with selected statements:
%
I always buy
the lowest
price products
or services
I am always on
the lookout for
opportunities to
switch to
cheaper
suppliers
I have more
choice than
before when it
comes to
products and
services
I always buy
Irish when I
can
Apr-13 57 71 52 52
May-13 58 69 54 54
Jun-13 55 70 55 51
Jul-13 56 70 52 53
Aug-13 57 70 53 53
Sep-13 59 72 53 54
Oct-13 58 69 52 51
Nov-13 56 69 55 51
Dec-13 54 68 54 53
Jan-14 59 74 56 54
Feb-14 56 70 57 52
Mar-14 57 68 56 48
Apr-14 56 69 54 50
13. 13Economic Recovery Index
Insulated
% of Irish adults who agree/disagree with the statement (by sex, age, class, Dublin):
“Right now the recession is affecting other people more than me”
Source: Amárach Research, April 2014
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
Weighted Sample 1000 494 507 169 223 187 156 265 279 477 523
Strongly Agree 16% 14% 19% 20% 19% 13% 12% 16% 17% 21% 12%
Slightly Agree 26% 26% 26% 25% 29% 25% 23% 28% 28% 31% 23%
Neither/Nor 19% 21% 18% 19% 21% 17% 20% 19% 19% 16% 22%
Slightly Disagree 19% 20% 18% 17% 16% 21% 24% 18% 19% 18% 20%
Strongly Disagree 17% 16% 17% 12% 12% 21% 19% 19% 15% 13% 20%
17. 17Economic Recovery Index
Discretionary Income
Typically, how much money do you have left at the end of the month, before your
next wage or salary payment?:
Base: all adults
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
Average
left over
€142 €165 €111 €116 €162 €136 €145 €124 €171 €179 €90
% saying zero 31% 29% 32% 21% 23% 33% 40% 35% 30% 27% 36%
25-34s are among the most financially resilient in terms of income
18. 18Economic Recovery Index
Income Pressures
Would you say you have:
Base: all adults
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
More money left
over than a few
months ago
11% 13% 9% 16% 15% 10% 7% 9% 15% 13% 8%
The same money
left over than a
few months ago
38% 39% 36% 39% 43% 37% 37% 31% 35% 40% 34%
Less money left
over than a few
months ago
51% 47% 55% 45% 43% 53% 56% 60% 50% 46% 57%
older age groups are experiencing the most pressure on incomes
19. 19Economic Recovery Index
Income Sensitivity
Please indicate how easily you would cope with a fall in monthly after tax income
in each of three scenarios: €50/€100/€150 monthly decrease - % cope easily:
Base: all adults
April 2014
TOTAL
2012
TOTAL
2014
Male Female 15-24 25-34 35-44 45-54 55+
ABC1
F50+
C2DE
F50-
% Easily: €50 21% 24% 25% 23% 22% 34% 22% 18% 21% 31% 18%
% Easily: €100 11% 12% 14% 10% 12% 20% 12% 7% 9% 17% 7%
% Easily: €150 8% 9% 10% 7% 11% 15% 6% 6% 5% 12% 5%
consumers are slightly more resilient to income shocks than 2 years ago
20. 20Economic Recovery Index
Rainy Day Funds
Which of the following best describes the total value of funds that you currently
have in savings or investments (excluding any formal pension plans)?
Base: all regular savers
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
% save
regularly
48% 49% 48% 61% 58% 40% 39% 44% 51% 54% 43%
Average value
of savings &
investments
€000s
€25.5 €37.0 €13.0 €7.4 €10.6 €13.2 €39.5 €58.7 €32.4 €32.2 €17.7
older consumers are less likely to save regularly & are living off past savings
21. 21Economic Recovery Index
Positive Equity
Thinking about the value of your home today, do you think it is worth more than
you currently owe on your mortgage, about the same as you currently owe on
your mortgage, or less than you currently owe on your mortgage?
Base: all responsible – solely or jointly – for paying mortgage on their home
April 2014
TOTAL
2012
TOTAL
2014
15-24 25-34 35-44 45-54 55+ Dublin
Rest
of
L’ster
ABC1
F50+
C2DE
F50-
Value of home is worth
more than you currently
owe on you mortgage
42% 47% 45% 37% 28% 55% 68% 57% 37% 49% 45%
Value of home is about
the same as you currently
owe on you mortgage
18% 14% 10% 29% 16% 12% 5% 10% 17% 13% 16%
Value of home is less than
you currently owe on you
mortgage
30% 27% 23% 26% 50% 24% 9% 23% 34% 28% 26%
Don’t know 10% 12% 22% 8% 6% 9% 19% 11% 11% 10% 13%
there has been a significant jump in positive equity over the past 2 years
22. 22Economic Recovery Index
Domestic Balance Sheet
How would you describe your situation in terms of your financial assets (e.g.:
house, car, savings, pensions) versus your financial liabilities (e.g.: mortgage,
loans, debts)? Would you say that...
Base: all adults
April 2014 TOTAL Male Female 15-24 25-34 35-44 45-54 55+ Dublin
ABC1
F50+
C2DE
F50-
Your financial assets
exceed your financial
liabilities
31% 36% 26% 19% 21% 23% 30% 53% 30% 35% 27%
Your financial assets
and liabilities roughly
match each other
35% 34% 35% 38% 41% 31% 35% 28% 39% 32% 37%
Your financial liabilities
exceed your financial
assets
22% 23% 22% 14% 24% 36% 25% 15% 18% 21% 24%
Don't know 12% 7% 17% 30% 13% 9% 10% 4% 13% 12% 12%
The Irish claim a positive ‘balance sheet’, but don’t forget:
debt is a fact, wealth is an opinion
24. 24Economic Recovery Index
The Mood of the Nation 1
Did you experience any of these feelings a lot of the day yesterday?
% saying Yes: April 2009 to April 2014
Source: Amárach Research, April 2014
0%
10%
20%
30%
40%
50%
60%
70%
Apr'09
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Jan'10
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'11
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'12
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'13
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'14
Feb
Mar
Apr
Enjoyment Happiness Stress Worry
25. 25Economic Recovery Index
The Mood of the Nation 2
Did you experience any of these feelings a lot of the day yesterday?
% saying Yes: April 2009 to April 2014
Source: Amárach Research, April 2014
0%
5%
10%
15%
20%
25%
30%
35%
40%
Apr'09
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Jan'10
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'11
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'12
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'13
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan'14
Feb
Mar
Apr
Anxiety Sadness Pain Anger
28. 28Economic Recovery Index
Recovering Opportunity
Our work at Amárach regularly requires us to
help clients identify new growth opportunities
in the face of wider economic constraints.
From our latest findings and supplementary
analyses we can see a widening generation
gap in terms of the Irish consumer market:
> 25-35s have more discretionary income
and are saving more of it
> over 45s have more wealth but are
experiencing greater income pressure.
We hope this 5th anniversary edition of the
Economic Recovery Index has given you
some food for thought about the opportunities
that lie ahead over the remainder of 2014.
29. we ask better questions
so you get better answers
Image: http://yourawakenedself.com/tag/jacob-nordby/
30.
31.
32. Trends Report
Call us on 01 410 5200 if you want maximize
the prize in 2014:
e. info@amarach.com
w. www.amarach.com
b. www.amarach.com/blog
t. twitter.com/AmarachResearch
For more on the ERI see:
http://www.amarach.com/resources/economic-recovery-index.htm