Younger Americans are speaking to their neighbors less often than they did a decade ago, and new research suggests the decline in local trust may now be carrying financial consequences.
A series of recent surveys from Gallup and the American Enterprise Institute indicate that weakening community relationships are affecting how Americans view their economic prospects, particularly among Gen Z and lower-income households. The findings point to a broader erosion in what economists and sociologists often describe as social capital, the value created through local trust, cooperation, and community networks.
For younger adults, the decline has been especially sharp. Just one-quarter of Americans aged 18 to 29 say they regularly speak with neighbors several times a week, according to data released this month by the American Enterprise Institute. In 2012, that figure stood at 59%.
The shift reflects a wider pullback from in-person social interaction across the United States, one that researchers increasingly believe has implications beyond loneliness or civic engagement.
Gallup Finds Strong Link Between Trust and Financial Confidence
Gallup’s latest polling found Americans who lack dependable local support systems are significantly less confident in their ability to manage financial challenges or improve their economic situation.
Respondents who said they could not rely on neighbors during difficult periods were between 16 and 22 percentage points less likely to believe they had control over their financial future. The survey also connected stronger neighborhood relationships with better perceptions of housing affordability and employment opportunities.
Gallup researchers argued that community conditions can shape economic confidence independently of income or personal circumstances. Nearly one-third of Americans surveyed said they do not rely on others in their community, while close to half reported that neighbors rarely cooperate on shared local issues.
Trust in local leadership also appears weak. More than half of respondents said they lacked confidence that community leaders act in residents’ interests, and roughly 70% believed their ideas for improving local areas would not be taken seriously.
The findings arrive as concerns around social isolation continue to rise in the United States. Former US surgeon general Vivek Murthy previously described loneliness as a public health issue, warning that social isolation carries risks comparable to smoking or obesity.
Remote Work and Fewer Third Places Changed Daily Habits
Researchers point to several reasons behind the decline in neighborhood interaction. One is the growing amount of time Americans spend indoors, particularly since the pandemic accelerated remote and hybrid work arrangements.
A 2024 ResumeBuilder survey found around one-quarter of remote workers believed their social skills had deteriorated after shifting to home-based work. While remote employment has provided flexibility and reduced commuting costs, it has also reduced the number of casual daily interactions many workers previously experienced in offices or during commutes.
At the same time, public gathering spaces have become less accessible or less attractive for younger consumers. Economists and urban planners have increasingly focused on the decline of so-called “third places”, locations outside the home and workplace where people gather socially, such as cafes, parks, libraries, bars, and community centers.
The Urban Institute reported in 2024 that years of reduced public investment had left many community spaces underfunded or poorly maintained. Rising living costs have also changed behavior among younger Americans, many of whom now spend less money on social activities outside the home.
That trend may have longer-term economic implications. According to research published by the National Bureau of Economic Research, regions with stronger social capital often show higher levels of entrepreneurship, lower crime rates, and stronger small-business survival rates.
Why Businesses and Cities Are Paying Attention
The economic implications of declining social trust are drawing increasing attention from business leaders and policymakers.
A 2022 study examining small businesses that received federal pandemic relief loans found companies operating in communities with stronger civic participation and higher local trust levels were more likely to perform successfully. Researchers identified community engagement and participation in local organizations as important indicators supporting business resilience.
For cities attempting to attract talent and investment, local quality of life is also becoming more closely tied to social cohesion. Deloitte has previously noted that younger workers increasingly prioritize community experience and belonging when choosing where to live and work.
Despite the negative findings, Gallup’s survey offered one encouraging signal. Roughly 72% of Americans still believe their communities are worth investing in, suggesting the appetite for stronger local ties remains intact even as participation declines.
The Next Test for Local Communities
The challenge for local governments and businesses may now be translating that goodwill into physical spaces and opportunities that encourage interaction again.
Urban investment, affordable gathering spaces, and community-led initiatives are likely to play a larger role as cities compete for residents and economic growth. For employers, the debate around remote work may increasingly extend beyond productivity and into questions about long-term social cohesion.
The broader warning from the data is that weakening community trust may no longer be viewed solely as a cultural issue. It is becoming an economic one.
