New York Fed: Tight Labor Market Impacts Consumer Confidence

Jinse Finance reported that the weak labor market this summer has affected Americans' outlook on the economic future. The latest consumer expectations survey from the New York Fed shows that in August, consumers' views on future employment prospects and the unemployment rate worsened, while short-term inflation expectations rose. In August, the proportion of people expecting the unemployment rate to rise in the next year increased by 1.7 percentage points from 37.4% in July to 39.1%. Meanwhile, expectations for the likelihood of finding a new job if losing their current one dropped by 5.8 percentage points to 44.9%—the lowest value since the New York Fed began tracking this data in June 2013. The pessimism toward the labor market may be justified. Hiring has been weak since May. In August, the U.S. added only 22,000 jobs, far below economists' expectations of an increase of 76,500 jobs. The unemployment rate rose to 4.3%, the highest level since 2021, while the number of people applying for unemployment benefits steadily increased in August.