Poll finds New Yorkers pessimistic on economy

For the second month in a row, confidence in the economy fell among metropolitan area consumers, according to a new poll.

The Siena College Research Institute Wednesday reported month-over-month declines for July in attitudes about the economy from residents living on Long Island and in New York City and its northern suburbs.

Pollster Douglas Lonnstrom attributed the reduction to the specter of a first-ever U.S. default and rising food prices. Area residents were more pessimistic in July about current economic conditions than residents nationwide. However, they were more optimistic about the future than the country in general.

The "debt-ceiling crisis has driven the consumer mood nationally into the tank, and in New York, while the fall wasn't as steep, the tears are just as real," Lonnstrom said. "Gone right now is the optimism consumers had as 2011 started."

Locally, food costs continue to pinch wallets. Seventy-one percent of metropolitan area residents said their finances were either very or somewhat seriously impacted by grocery prices, up from 68 percent in June.

Separately, residents statewide, when asked about big-ticket purchases in the next six months, were more likely than in July 2010 to buy a home or undertake a large home-improvement project.

Lonnstrom and others said Washington wrangling over whether to raise the limit on borrowing worried many people because without this week's compromise there likely would have been a spike in interest rates, a credit crunch and turmoil on Wall Street. The Dow Jones industrial average lost 858 points in eight days before Wednesday's 30-point rebound.

Area residents also are nervous about the job market. For example, the Long Island workforce has contracted for the past two months and the unemployment rate remains high. "Did all that talk of [federal government] insolvency scare consumers? . . . Yes," Lonnstrom said.

The poll of 800 state residents older than 18 was conducted by telephone last month and has a margin of error of plus or minus 3.5 percentage points.

Outside a Pathmark in Massapequa, retiree Mike O'Neill was upset Wednesday about the debt ceiling. "I cannot believe [Washington leaders] almost let the country default," said O'Neill, 71, of Massapequa Park. "That would have sent us back into recession."