(Bloomberg) -- An index based on thousands of legal inquiries found lower consumer financial-stress levels among swing-states households than the national average.

LegalShield’s consumer stress legal index, created in 2018, is measured by calls received monthly from people seeking legal assistance in the US. For the first time in March, the company broke out state stress levels on a political basis. 

The indicator showed that battleground states in the upcoming presidential election — Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania and Wisconsin — reported a drop in stress to just below the national level last month.

Based on historical data, if the numbers were to hold until this fall, they may favor President Joe Biden’s re-election, according to LegalShield. 

“The trend suggests that when ‘swing state’ consumer stress, as measured by more than 150,000 consumer legal inquiries we field each month, dips below national stress average in October and November, conditions favor a Democratic win,” Matt Layton, LegalShield senior vice president of consumer analytics, said in a statement. “That’s where we are now; we’ll be watching this relationship closely.”

The campaign still has a long way to go and LegalShield’s past data show that when consumer stress rose higher than the average in swing states ahead of the election, a Republican was elected. So far Biden has lagged Republican Donald Trump in several key battleground states in monthly Bloomberg News/Morning Consult polls.

Nationwide, consumer financial stress declined to the lowest in 12 months based on the volume of calls seeking legal assistance. The result aligns with economic indicators pointing to strength in the job market and consumer spending last month. 

All three sub-indices in LegalShield’s measure — bankruptcy, consumer finance and foreclosure — fell in March. But the bankruptcy index is up 21% from a year earlier. LegalShield said its indicator typically leads actual bankruptcy filings as reported by the US court system by two quarters, suggesting an upcoming uptick in filings. 

LegalShield is a subscription legal service that provides individuals with legal guidance. The monthly consumer stress index includes more than 35 million requests for legal assistance since 2002.

 

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