New Zealanders rate economy as among world's strongest

New Zealanders are among the most confident about their economy in the world, new research from Pew Research Centre shows.

The think-tank surveyed people in countries around the world in May about their perceptions of their economy and the financial future of the next generation.

It found that 73 per cent of New Zealanders said the local economic situation was good, behind only Sweden, at 86 per cent, and Australia at 74 per cent.

The global median was 47 per cent believing the situation was good. In New Zealand, just 4 per cent said the economy was very bad, compared to 48 per cent in Spain. Eighty per cent or more in Spain, Italy and Japan say the economic situation is bad in their countries, as did 70 per cent or more Greeks, French, South Koreans and Americans.

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New Zealand recorded quarterly gross domestic product (GDP) growth of 1.6 per cent in March, compared to 1.8 per cent in Australia and a drop of 1.5 per cent in Britain. Japan and Germany also experienced GDP declines in the quarter.

This is the first year New Zealand has been included in the research but it showed that Australians were feeling much more positive than a year ago, when just 36 per cent rated their economy as good.

Report author and research associate Shannon Schumacher said people who thought their country had handled Covid well were more likely to say their economy was good.

But she said there was gender disparity in New Zealand that was not seen in some other countries.

Women were more likely to say the economy was bad than men were – 78 per cent of men said it was good compared to 70 per cent of women.

Men were also more likely to say that they thought children would be better off financially, which Schumacher said was not the case everywhere.

People were also asked whether they thought when children today grew up they would be better off or worse off financially than their parents. Globally, 64 per cent said children would be worse off. In New Zealand, 64 per cent said children would be worse off. The most pessimistic people were in Japan and France, where 77 per cent expected children to be worse off.

Schumacher said New Zealand’s response was in line with the global median – and the answers to that question had historically been pessimistic.

Pew researchers also updated their work on global incomes and found the “middle class” encompassed 54 million fewer people than the number projected before the pandemic.

The number of poor was estimated to be 131 million higher because of the pandemic’s economic downturn. In percentage terms, 17 per cent of the global population would be considered middle income in 2020, 51 per cent were low income and 10 per cent poor. Just 7 per cent were classed as high income.

The researchers’ calculator showed a New Zealand household with two adults earning $60,000 a year, and two children, would be in the upper-middle-income group worldwide, along with 47.9 per cent of people in advanced economies.

The calculator uses purchasing power parity dollars, exchange rates adjusted for differences in the prices of goods and services across countries.