I’m in stocks. If you are too, odds are your neighbor isn’t.
An annual survey produced by Gallup revealed that just 52% of U.S. adults own stocks. This is the lowest percentage ever reported by Gallup, who began tracking this in 1998.
To put this in perspective, U.S. adults have never participated in the stock market at greater than 65% (2007), according to the Gallup poll. The next highest participation rate was 62% in 2008, 2005, 2001, and 2000.
What’s strange though is that as the stock market has recovered and as the unemployment rate has lowered, the percentage of stock ownership has continually gone down from 57% in 2009 to 52% in 2013.
This news might come as a shock to many, especially after the Dow hit above 15,000, and an all-time high, this week. With stocks doing so well, long since recovered from the crash of 2007, you might wonder why so few are still choosing to remain on the sidelines.
Continued long-term unemployment is the obvious culprit. Last week, it was reported that unemployment was at 7.5%, still one and a half points higher than anytime pre-2009 according to the same study. And the labor force participation rate is still very low. The lowest since 1979.
But the other factor is obviously the damage done to consumer confidence in the stock market. Even though some might have the cash to invest, they are simply remaining in other assets, like bonds, real estate, and gold.
The poll also shows that the biggest change in participation over the last five years came from those with an income between $30K-$75K, and those aged 30-49.
I never left the market. But I had the income (for the most part) to support my continued participation. I’m also in my mid thirties and I’m only confident in the long-term market. Did you continue to participate? Did you sell your stocks, either because of unemployment or for distrust? Do you trust the market?