The Democrats may not be in as much trouble as everyone thought. Although Pollster still has them trailing Republicans by a point on a generic Congressional ballot—and they have trailed since late last year—it doesn’t matter what voters say right now. What matters is how voters feel in November, and it’s starting to look like things are improving for the Democrats.

The New York Times reported this week that while the economy is recovering slowly, it is recovering more quickly in key battleground areas. While unemployment is still higher everywhere than it was two years ago, what generally matters most to voters is whether things are improving in the months before an election. And the paper found that the most closely contested congressional races were in districts that were adding jobs faster than elsewhere around the country. In particular, manufacturing is rebounding in crucial parts of Ohio, Pennsylvania, and New York. And all but one of the 17 states where there are contested Senate rates—with the significant exception of Nevada, where Senate Majority Leader Harry Reid (D-NV) is in serious trouble—is showing job growth.

Just as important for the Democrats is the fact that the public is warming to the health care reform bill they passed in March. The Republicans to a large extent staked their electoral chances on the idea that the bill—which they fought against tooth and nail—would prove to be unpopular. The Democrats meanwhile bet everything on the idea that once the bill passed people would come to see that it was a substantial improvement over the old system. Now a new Gallup poll shows that the Democrats may have been right. For the first time more people think health care reform is a good thing rather than a bad thing. The poll shows that people’s opinion of health care reform has improved among every age group except the elderly. The overall margin is small—just 3 points—but it represents a 6 point swing since the bill passed just a few months ago. While opinion hasn’t changed significantly among the crucial group of independent voters—and the swing is small enough that to be sampling error—if the public opinion of health care reform is actually improving, that’s great news for the Democrats.

The smart money is still on the Democrats losing a substantial number of seats in the fall. The political futures traders at Intrade still give the Republicans even odds of taking the House back. It doesn’t help that the Democratic administration has been unable to stop the flow of oil into the Gulf. But with the economy improving and the popular opinion of health care reform on the rise, it seems increasingly unlikely that the Democrats will suffer the kind of losses they did in 1994.