What Shapes Attitudes Toward Business and Government?

Americans have a generally favorable opinion of major companies but clearly prefer small businesses, according to the 2014 Public Affairs Pulse survey. Meanwhile, majorities view state government positively but hold negative views of the federal government.

Many factors affect these attitudes, including personal experience dealing with major companies or federal agencies, reading the news, using social media or watching portrayals of executives and politicians in TV shows and movies. When it comes to business, personal experience is the primary influence in shaping people’s opinions. For attitudes toward the federal government, news and the Internet play a larger role.

Ratings Improve for Business and State Government

Americans are looking with increasing favor on both major companies and small businesses, the Pulse survey shows. With a slowly improving economic outlook, nearly seven in ten Americans (69%) have a very favorable or somewhat favorable view of major companies. This represents a substantial increase in the past year, putting public attitudes about where they were in 2012, when 67 percent held a positive view of corporations.

Overwhelming majorities of adults feel positively toward small businesses, a sentiment that has remained unchanged since the first Pulse survey in 2011. In the current poll, 91 percent of Americans say their opinions of small businesses are either very or somewhat favorable, while only a handful hold a negative view.

Looking at the public sector, discontent varies by level of government. Six in ten Americans say they have a favorable view of their state government, while only 38 percent have an unfavorable view. Meanwhile, the federal government continues to fall short, with only 45 percent of Americans having favorable views of it, a slight improvement since last year. A majority of adults (53%) hold unfavorable opinions of Washington.

The Influence of Ideology, Race and Income

Americans’ views about big business are remarkably consistent across age groups and education level. But among other demographic categories, favorability of major companies is not as uniform. Seventy-six percent of conservatives feel positively toward these types of businesses. On the other end are liberals, whose favorable/unfavorable ratings are split 58 percent to 37 percent. Moderates fall right in the middle, with 70 percent having positive opinions of major companies and 26 percent holding negative views.

Attitudes about the federal government vary significantly by race and income. Large majorities of African-Americans (69%) and Hispanics (59%) say their views of the federal government are favorable, compared with only 37 percent of white adults. One-half of Americans with household incomes of less than $30,000 a year hold favorable opinions of the federal government, compared with 41 percent of those with incomes of $30,000 or more.

Where Businesses Get Passing and Failing Grades

One of the reasons Americans hold generally positive views about major companies is they believe these businesses handle the basics well. The public thinks major companies are doing a good job providing useful products and serving their customers and stockholders. However, Americans are more negative about business performance when it comes to executive compensation, paying employees fairly, protecting the environment, creating jobs and supporting local communities.

On the positive side, a vast majority of Americans (78%) agree that major companies do a good job of providing useful products and services. This finding represents the largest share of Americans to hold this opinion since the question was first asked in 2011 (compared with 73% in 2013 and 2012, and 72% in 2011). Some 68 percent of Americans agree that major companies generally serve their customers well.

A substantial segment of the public also thinks major companies are doing right by their stockholders. Fully three-quarters (75%) say corporations serve their stockholders well, up more than 10 percentage points since last year. Considering the dramatic turnaround in the stock market since the Great Recession, it makes sense that these particular ratings are up even more from earlier editions of the Pulse survey (59% in 2012 and 57% in 2011).

Major companies have work to do in other areas, getting negative scores in key categories that are important to Americans. A majority of adults (55%) still think major companies are generally not doing well on creating jobs, compared with 42 percent who rate their performance in this area as good. The further away the nation gets from the economic downturn, however, the fewer Americans show disappointment over job creation.

Compensation of business executives and rank-and-file employees continues to create ill feelings. Only one-quarter of the public (25%) say major companies are “paying their top executives fairly, without overpaying them.” Fully seven in ten adults say corporations are doing a poor job in this area. Americans stand firmly in the corner of regular corporate employees, with just 37 percent agreeing that major companies do a good job of paying their employees fairly, while three in five adults (59%) disagree.

Millennials in particular think major companies handle the basics of business well. Seventy-four percent of those between the ages of 18 and 33 say corporations do a good job of serving their customers, and even more sing their praises on providing useful products and services (80%) and serving their stockholders (81%). A significantly smaller share of Millennials (45%) think major companies do well at creating jobs — perhaps unsurprising for the group that has been known to struggle the most in today’s difficult job market.

Young Americans are also quite dissatisfied with the gap in compensation between regular employees and executives. Just 33 percent of Millennials say major companies pay their rank-and-file employees equitably. A strong majority of young adults (68%) say corporations are generally not doing a good job of paying top executives fairly without overcompensating them.

So what are the major drivers of all these opinions?

Personal Experience Shapes Americans’ Views of Business

Personal experiences top the list for shaping people’s opinions of major companies. Nearly two in five Americans (39%) say first-hand experience as a customer of a major company has had a lot of influence on their opinions of those firms. And over a third (36%) say such experiences have had some influence.

The Internet is the second-ranked source overall for driving attitudes toward major companies, with 30 percent saying it has had a lot of influence on their attitudes and a slightly larger number (34%) saying it has had some influence.

Another large category, the news, is third-ranked, cited by 24 percent of the public as being a major source of influence about major companies, with 40 percent saying it has had some influence.

Knowing people who work for major companies is also a factor, with 23 percent saying such contacts have a lot of influence and 37 percent saying they have had some influence.

Personal experience working for a major company is another significant source, with 29 percent saying it has had a lot of influence on their views of major companies and 26 percent saying it has had some influence.

Movies, television shows and other entertainment sources are mentioned as having a lot of influence by 16 percent and some influence by 29 percent. And, despite all the time spent on social media sites such as Facebook and Twitter, social media was named as having a lot of influence on attitudes by just 14 percent and some influence by 22 percent.

However, age-group differences come into play on this issue. Seven in ten Millennials have favorable views of major companies, and their opinions are often heavily influenced by personal experience as consumers or exposure to information online. Fully one-half of young adults report that their personal experience as a customer of a major company has a lot of influence in shaping their opinions of corporations.

Majorities of Millennials also say that social media and the Internet in general are driving factors in shaping their views of major companies. For instance, 53 percent of Millennials say they are influenced by social media, with one in five reporting their opinions of major companies are influenced “a lot” this way. The strength of influence wanes in older generations. Forty percent of Gen X-ers and 31 percent of Baby Boomers say social media influences their opinions of corporate America, while even fewer adults in the Silent or Greatest Generations say the same. The Internet in general helps shape views of major companies for the bulk of Millennials (82%), Gen X-ers (70%) and Boomers (57%), but less than three in ten of the oldest Americans agree.

Second-Hand Sources Drive Views of Government

In contrast, attitudes toward the government are more likely to be based on nonpersonal sources, such as the news and the Internet in general. Personal experiences do play a role, but it is a smaller role than in shaping attitudes about business.

The news is the number-one source cited by Americans, with 29 percent saying the news has had a lot of influence on their attitudes toward the federal government. An even larger group, 42 percent, say it has had some influence.

The Internet is also a frequently cited source overall for driving attitudes toward the federal government, with almost a quarter (24%) saying it has had a lot of influence on their opinions. Thirty-eight percent say it has had some influence.

Personal experience dealing with the federal government is at about the same level as the Internet in terms of having substantial impact. About a quarter (26%) say personal experience interacting with the federal government has had a lot of influence in shaping their opinions of Washington. And about a third (32%) say such experiences have had some influence.

Knowing people who work for the federal government is the fourth-ranked source of influence, with 16 percent saying such contacts have a lot of influence. Almost a third (30%) say they have had some influence.

It is worth noting that knowing people within the institutions was the fourth-ranked source for both business and government. Of course, the incidence of such knowledge was much lower for government, since government employs far fewer people than do major businesses. Thus, it is not surprising that personal experience working for the federal government is the lowest-ranked source, with just 12 percent saying that has had a lot of influence on their views of Washington and 13 percent saying it has had some influence.

Other nonpersonal experiences are also ranked low. Movies, television shows and other entertainment sources are mentioned as having a lot of influence by 13 percent and some influence by 26 percent. And social media sites are cited as having a lot of influence by just 12 percent and some influence by 21 percent.

The Public Affairs Pulse survey, conducted June 16-29, 2014, by Princeton Survey Research Associates International, is based on telephone interviews with 1,609 adults nationwide.