- More than half of Americans surveyed by Allianz said they’re worried about a major recession.
- Over half also said they’re holding more money in cash than they should because of it.
- Millennials were slightly more likely than other generations to worry about losing their jobs and say they’re holding more money in cash.
- Globally, financial assets fell 2.7% in 2022, the biggest decline since the Global Financial Crisis in 2008, but Allianz economists anticipate asset growth in 2023.
With Fed officials suggesting further rate hikes could be on the horizon and inflation proving more stubborn than expected, Americans are increasingly pessimistic about the economy, with over half (55%) saying they’re worried about a coming recession, research by Allianz found.
Those worries impact how Americans invest, with more than half (54%) admitting to keeping more money than they should in cash due to their recession worries. Millennials were slightly more likely than other generations to say recession concerns are leading them to hold more in cash at 57%, compared to 52% of Gen Xers and 46% of baby boomers.
Millennials were also significantly more likely to be concerned about losing their jobs, with 52% worrying about being laid off because of an economic downturn. In comparison, 29% of Gen X and 25% of baby boomer respondents said the same.
According to Allianz, those worries come after a tough year for financial assets in 2022, when global financial assets fell 2.7% in the biggest decline since the Global Financial Crisis in 2008. However, economists at the firm say they anticipate global assets will grow rather than contract in 2023.
Allianz projects global financial assets will bounce back from the losses seen in 2022 with a 6% increase in global financial assets by the end of 2023, writing, “Given a global inflation rate of around 6% in 2023, savers around the world should be spared another year of real losses on their financial assets.”
“But the mid-term outlook is rather mixed,” Allianz noted, adding that “strong economic tailwinds also cannot be expected.”