Residents Upbeat About Economy : Nearly Half Say They Are Better Off Now Than 4 Years Ago

By PATRICK LEE

Oct. 29, 1996 12 AM PT

TIMES STAFF WRITER

Californians continue to feel better about the state’s rebounding economy and their own financial circumstances, with a higher percentage saying they will boost holiday spending this year, according to the latest Los Angeles Times Poll.

The poll shows that nearly half of Californians--47%--said they are better off now than they were four years ago. Only 22% said they are worse off; 30% said they are about the same.

That’s a slight improvement over the last Times Poll in September, when 43% said they were better off.

That’s good news for President Clinton, who told Californians in the last presidential debate that if they felt worse off now than they did four years ago, they should vote for his rival, Bob Dole.

But the good feelings on the state economy run lower among minorities, women and residents with lower incomes, and among Southern Californians compared with Bay Area denizens, reflecting the different pace at which the recovery is occurring throughout the state.

“In general, blacks are not seeing the turnaround as fast as whites are . . . and L.A. is less confident” than other parts of the state, said Susan Pinkus, acting director of The Times Poll. “That also has to do with the higher population of minorities here.”

The poll, conducted Oct. 17-21, found that 41% of state residents surveyed believe the state is out of the recession, the highest level in the last five years.

About 27% of respondents also believe the state’s economy will do better three months from now, the highest level in five years and significantly better than the lowest response of 11% three years ago.

And in a finding that bodes well for retailers and others dependent on a robust holiday season, 16% of respondents said they will boost spending on holiday gifts this year, up from 12% in 1991, the last time the question was asked. Only 29% said they will spend less, compared with 56% in 1991.

The higher confidence levels are in keeping with other recent indicators that show California’s recovery is being noticed.

“We’re at that stage in the cycle where confidence does tend to be high,” said Gary Schlossberg, senior economist at Wells Fargo Bank in San Francisco. “We still have pockets of weakness and slack in the economy, particularly in the southern part of the state, but we’re doing a heck of a lot better than we were.”

Earlier this month, the Center for Continuing Study of the California Economy forecast that net outflow of U.S. residents from the state would bottom out this year and reverse itself. Other experts disputed that forecast, but they agreed that the net outflow is steadily decreasing.

Separately, the UCLA Anderson Business Forecast in September reported that the July index of consumer confidence in the Western states, which is dominated by California, reached its highest level in six years.

Because consumer spending is generally believed to account for two-thirds of the economy’s activity, rising confidence is seen as a harbinger of better times. The confidence extends to business consumers as well, one banker said.

“Our small-business clients are in the last eight months . . . far more ready to borrow than they were before,” said Richard Hartnack, vice chairman of Union Bank of California in Los Angeles.

Still, the state’s good economic fortunes are not being felt equally, according to the poll.

Among its findings:

* White Californians are the most content with the state economy, while blacks are the least content. Latinos fall somewhere in the middle.

Whereas 71% of whites reported they felt secure with their personal finances, just 51% of blacks and 60% of Latinos had similar sentiments. But a greater percentage of blacks and Latinos than whites said they are better off now than four years ago.

* Confidence also is weaker among lower-income residents than among the more affluent. Almost two-thirds of Californians earning less than $20,000 a year thought the state remained mired in some degree of recession, while only 44% of those earning more than $60,000 a year thought so.

Not surprisingly, nearly 60% of those earning less than $20,000 a year described their personal finances as shaky, compared with only 17% among those earning more than $60,000 a year.

* Californians also differed by region. About 47% of Los Angeles County residents said they are better off than four years ago, compared with 52% of Bay Area residents. Only a third of L.A. County respondents said the state is out of recession, compared with 51% of Bay Area residents.

* Women are less sanguine than men about the economy. Nearly half of men felt the economy is out of recession, but only 34% of women felt the same.

The Times Poll was based on a telephone survey of 1,551 residents. The margin of error is plus or minus 3 percentage points. The margin may be greater for subgroups.

Times Poll analyst Monika McDermott contributed to this report.

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California Confidence

Californians are feeling good about the economy and their own financial circumstances and plan to spend he same or more this holiday season as last, according to the latest Los Angeles Times Poll.

Are you better off, worse off or in about the same financial situation you were in at this time four years ago?

Better off: 47%

Worse off: 22%

About the same: 30%

Don’t know: 1%

Compared with last year, would you say that this holiday season you will spend more, less or about the same?

More: 16%

Less: 29%

About the same: 52%

Don’t know: 1%

Do you think California is in an economic recession or not?

ALL