A world less anxious
Despite mounting global challenges, anxiety levels are falling worldwide. Easing concerns around the economy, geopolitics, and more are likely helping to drive the trend.
Collectively, the world has confronted a lot over the last few years. Pandemic. Inflation. War. Global recession warnings. Energy crisis. Climate change. Some observers are referring to this unique moment in time as “polycrisis”—the convergence of many disparate social, economic, geopolitical, environmental, and technological stressors, whose combined impact surpasses the sum of their parts.1
But against the backdrop of polycrisis, consumer sentiment, perhaps, isn’t moving in the direction some might expect. Over the past year, global anxiety levels have started to fall (figure 1). In fact, the drops have been significant in a handful of countries, from Canada to Germany, Belgium, and the Netherlands. Following the recent swell of global challenges, consumer anxiety is showing meaningful signs of receding for the first time in years.
Easing financial stress is likely playing a key role in taming global anxiety levels. Over the past year, the percentage of global survey respondents feeling anxious about the direction of the economy has decreased from 38% to 31% (figure 2). Similarly, slightly fewer are feeling anxious about their personal financial situation. In recent months, consumers are likely responding to signs of easing global inflation.2 And the relationship between inflation and consumers’ general sense of financial well-being can be incredibly strong. In the United States, for example, inflation rates and financial well-being sentiment form virtual mirror images of each other when overlayed (for more details, read Consumers navigate financial ups and downs).
Interestingly, while voices like the World Bank still forecast slowing global growth for the year ahead, global anxiety around jobs and employment has yet to show any meaningful change.3
But anxiety isn’t just falling on the financial front. Worry around geopolitics has dropped too. In September 2022, political uncertainty ranked as the third-highest driver of global anxiety, behind finances (figure 2). As of June 2023, it dropped to the sixth position. Consumers are now more likely to feel anxious about personal family matters or their health.
Easing geopolitical concerns are likely tied to the Russia-Ukraine war. Over the past year, anxiety around political uncertainty saw some of the steepest drops across Europe, including Italy (–26), Germany (–18), the Netherlands (–14), and France (–12).
Beyond finances and geopolitics, some lingering pandemic anxiety faded away as well, likely helping to drive down overall anxiety levels even further.
Anxiety also fell across a number of other drivers. But there’s a bit more mystery as to why. Climate change offers a good example. Over the past year, the percentage of global survey respondents who cited feeling anxious about climate change slipped (figure 2). The trend runs against the grain of rising global consumer consciousness and seemingly perpetual extreme weather events. One potential explanation could be the effect of polycrisis itself. As consumers confront new challenges, particularly those presenting a more immediate impact on daily life (like rising prices), consumers may lose some focus on broader concerns (for more on sustainability and consumer behavior, read Green products come of age).
Global anxiety disparity
While easing anxiety is a welcome global trend, anxiety levels still vary significantly across the world—even across neighboring developed countries (for instance, Italy versus Germany).
Some of the overall global disparity is heightened by the extremely low levels of anxiety measured in several Northern Europe and Scandinavian countries. For quite some time, studies such as The World Happiness Report have published similar findings, ranking countries like Sweden, Denmark, and the Netherlands among the highest in global happiness.4 Quality of public services, social equality, and trust between citizens have all been explored as potential drivers of happiness in the region.5 And it’s perhaps not too surprising that happiness and anxiety seem to be inversely related.
On the opposite end, anxiety remains relatively high in countries such as Brazil, Ireland, Poland, and South Africa (figure 1). And each country seems to be dealing with its own unique combination of stressors. For example, in Brazil, while financial stress measures in high, the country’s most prominent anxiety driver is personal family matters. In Poland, it’s health. In South Africa, anxiety is primarily driven by finances, with well over half of study respondents citing anxiety around their personal finances (58%) and the direction of the economy (55%), with little improvement over the past year.
Japan remains an interesting outlier. Across 18 study countries, Japan remains the only nation where anxiety has increased significantly over the past year. Compared to the rest of the world, Japanese consumers are generally more likely to feel more anxious about most topics. For example, the percentage of Japanese survey respondents concerned about COVID-19 (29%) is almost three times higher than the global average. Worry around other topics like health and societal unrest measure relatively high too.
On the economic front, Japan seems to be marching to its own beat, at least relative to some developed economies. While inflation finally shows signs of easing in many countries, rates are just starting to flare up in Japan, hitting 4.3% earlier in 2023.6 While the rate isn’t incredibly high, it’s a four-decade record. And while financial anxiety eased in recent months for most countries, Japan has moved in the opposite direction.
Managing through storms
The global anxiety sparked by events like record inflation and pandemic didn’t just stop at anxiety. It materialized into swift and sweeping changes in consumer behavior that shocked historic demand and operating models. Until recently, organizations around the world could rely on a certain level of stability in domestic and global institutions over traditional investment and planning horizons. As that stability only seems to erode, how companies act in the face of global uncertainty is becoming a defining theme of modern business.
In today’s operating environment, it’s increasingly important for companies to view risks as more intrinsic and ubiquitous than exceptional. Beyond the silo of crisis management, risks are a part of the spectrum of operational factors that organizations should build around. Encompassing these factors means focusing not just on “recovery” but also on agility and ever-greater resilience so as to reduce the impact of events, speed up response, and evolve.