The Federal Reserve Board issued its annual Economic Well-Being of U.S. Households report, which showed strong numbers, but did not include data from the current economic environment.
The report – which examines the financial lives of roughly 11,000 U.S. adults and their families – draws from the board’s ninth annual Survey of Household Economics and Decision-making, or SHED, conducted in October and November of 2021. That, of course, was when the stock market was soaring, and inflation hadn’t taken hold yet.
But the report indicates that, at that point in time, self-reported financial well-being reached its highest level since the SHED began in 2013. In the fourth quarter of 2021, 78 percent of adults reported doing okay or living comfortably financially. Financial well-being also increased among all the racial and ethnic groups measured in the survey, with a particularly large increase among Hispanic adults. Also, three-quarters of parents said they were doing at least okay financially, up 8 percentage points from 2020.
“The SHED results provide valuable insight into Americans’ financial conditions during the late fall of 2021. This important perspective helps the Federal Reserve better understand the economic challenges that existed during that phase of the pandemic recovery,” Federal Reserve Board Governor Michelle Bowman said.
Further, 68 percent of adults reported that they would cover a $400 emergency expense using cash or its equivalent — the highest level since the start of the survey and up from 50 percent the previous year. In addition, 15 percent of workers said they were in a different job 12 months earlier, with most calling the job change an improvement.
Also, it found that 22 percent of employees worked entirely from home, down from 29 percent in late 2020, but above the 7 percent who worked entirely from home before the pandemic. Most employees who worked from home preferred to do so, often citing work-life balance and less time commuting. Those working from home said they would be as likely to look for a new job if required to return to the office as they would if their employer instituted a pay freeze.