Americans are getting worried about the job market

Washington DC

US consumer confidence worsened in April as Americans became more pessimistic about the job market.

The Conference Board’s Consumer Confidence Index, which measures attitudes about the economy and labor market, fell to 101.3 in April, down from 104 in March and marking the lowest level since July 2022. The group’s measure of economic expectations fell in April and has remained below a threshold “associated with a recession within the next year” for every month since February 2022, with the exception of an upturn in December.

Consumer attitudes have remained steady since the turbulence in the banking industry last month, but high inflation and economic uncertainty have continued to weigh on consumers.

“Consumers became more pessimistic about the outlook for both business conditions and labor markets,” Ataman Ozyildirim, senior director of economics at The Conference Board, said in a statement accompanying the data. “Compared to last month, fewer households expect business conditions to improve and more expect conditions to worsen over the next six months. They also expect fewer jobs to be available in the short term.”

This corresponds to figures from the government which show that the labor market has started to show cracks. Employers added 236,000 jobs in March, the smallest increase in two years, and job vacancies fell below 10 million for the first time since May 2021. Major companies have continued to announce layoffs, such as 3M, which on Tuesday announced it was cutting 6,000 jobs.

The April survey showed that worries about the economy slipping into recession persisted last month. Economists, including those at the Federal Reserve, expect a recession later in the year as the Fed’s rate hikes take a deeper bite. The share of consumers expecting more job openings fell to 12.5% ​​in April, down from 15.5% in March, while the share expecting fewer jobs rose to 21% from 20.5% in the same period.

“Expectations signal weaker consumption, but not a catastrophe,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in an analyst note.

Household spending increased at a slower pace in February compared to a 2% jump in January. The Ministry of Trade will publish consumption figures for March on Friday.

The University of Michigan’s preliminary consumer sentiment reading for April also showed that consumers were more affected by financial fears and high inflation than the failures of Silicon Valley Bank and Signature Bank.

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