KEY POINTS:
Rising food and petrol prices combined with high interest rates may be making life difficult but most people are fairly confident with their personal situations and believe others are worse off than them.
Although the Treasury declared this month that the economy is in recession, new research has found most New Zealanders are taking things in their stride and the country is experiencing a "half-recession".
"Despite the demand-side taking a beating, with high fuel costs, mortgage interest rates and food prices, people's confidence in their personal situation remains high," said Jill Caldwell, director of research company Windshift. "They generally see trouble as happening to other people, not to them."
Survey participants were asked to rate their personal mood or satisfaction life on a scale of 1 to 5, with 1 being as bad as it could be.
The average score for personal mood was 3.9 but people thought other New Zealanders were less happy, giving them a lower rating of 2.9.
"If we followed the media and that, it should be shit, but not for me. I'm feeling quite up," said one participant.
The research - drawn from 500 New Zealanders of mixed socio-economic groups - found confidence in job prospects remains high and there was little decline in the country's mood.
"Even though people are personally adapting to the current situation, they seem to see the worst of the effects as happening to somebody else," said Ms Caldwell. "While employment remains high, and personal circumstances remain relatively comfortable, these sentiments will remain intact."
Ms Caldwell said people on lower incomes had taken on more work or moved to take up more lucrative opportunities, showing there were still jobs for those who wanted them.
People were adjusting to the downturn in the economy. They were not eating out as much and many had changed their shopping habits - window shopping, without the impulse purchasing.
"They consider it important to be seen by their peers to be behaving more conservatively and resourcefully. More often now there's a sense of purpose to shopping expeditions; it will be about stocking up on bulk commodities or tracking down bargains."
The survey found people thought mortgage rates were cyclically high and would gradually drop, but they didn't believe the price of homes would decrease to previous lows.
In contrast, most people felt petrol prices would continue to rise and there was a greater uncertainty in the future.
NATION'S MOOD
* It's only half a recession.
* People see trouble as something affecting others.
* People aren't as stressed as when growth was higher.
* Confidence in job prospects is high.
* People believe house prices will plateau rather than drop to previous lows and that petrol will continue to rise.
* Most New Zealanders are operating more conservatively.
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