Job market worries plague confidence index for September, report shows

WASHINGTON, D.C. – Concerns about the labor market conditions seemed to weigh on consumers’ minds during September as the Consumer Confidence Index and the labor market assessments took hits, according to the latest report from The Conference Board.

The confidence index dipped back below 100 for September to 98.7, down significantly from the revised 105.6 in August. The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – fell by more than 10 points to 124.3. The Expectations Index – based on consumers’ short-term outlook on business and labor conditions – also decreased, down to 81.7 from 86.3.

“Consumer confidence dropped in September to near the bottom of the narrow range that has prevailed over the past two years,” said Dana M. Peterson, chief economist at The Conference Board. “September’s decline was the largest since August 2021 and all five components of the Index deteriorated.

“The deterioration across the Index’s main components likely reflected consumers’ concerns about the labor market and reactions to fewer hours, slower payroll increases, fewer job openings — even if the labor market remains quite healthy, with low unemployment, few layoffs and elevated wages.”

Consumers’ outlook on interest rates is seeing new levels, too. The share of consumers expecting interest rates to increase over the next 12 months dropped for the fourth straight month to 46.5 percent, its lowest since February 2024. Meanwhile, the share expecting rates to decrease increased to 33.3 percent, its highest since April 2020.

Here is a deeper look at some of the report’s findings:

Present Situation

Consumers’ assessments of current business conditions turned negative in September.

• 18.8 percent of consumers said business conditions were “good,” down from 21.1 percent in August.
• 20.2 percent said business conditions were “bad,” up from 17.3 percent.

Consumers’ appraisals of the labor market deteriorated in September.

• 30.9 percent of consumers said jobs were “plentiful,” down from 32.7 percent in August.
• 18.3 percent of consumers said jobs were “hard to get,” up from 16.8 percent.

Expectations Six Months Hence        

Consumers were less optimistic about the business conditions outlook in September.

• 18.5 percent of consumers expected business conditions to improve, down from 19.1 percent in August.
• 16.6 percent expected business conditions to worsen, up from 14.5 percent.

Consumers’ assessments of the labor market outlook were more pessimistic in September.

• 16.4 percent of consumers expected more jobs to be available, up slightly from 16.3 percent in August.
• But 18.3 percent anticipated fewer jobs, up from 17.0 percent.

Consumers’ assessments of their income prospects were less optimistic in September.

• 18.0 percent of consumers expected their incomes to increase, down from 18.6 percent in August.
• 13.0 percent expected their incomes to decrease, up from 11.7 percent.

See also:

• Fed rate cut is good news, but don’t pop the corks just yet | Bill McLoughlin
• Recession fears are over as fed prepares to lower interest rates. But what about the job market?