Households Are More Pessimistic About Job Changes
U.S. consumers were more pessimistic about finding a new job in October than at any point since 2014—even more downbeat than at the height of the COVID-19 lockdowns, according to the latest survey of consumer expectations from the Federal Reserve Bank of New York.
Households were also more hesitant to give up their current job, the survey showed, with the likelihood of voluntarily leaving reaching its lowest point since April.
It’s no surprise people are feeling less optimistic and increasingly cautious. The recovery in the job market has been slowing, Congress has failed to pass another federal relief bill, and the number of average daily cases of COVID-19 is surging. What’s more, uncertainty about the outcome of the presidential election gripped the nation last month, with voters on tenterhooks about the potential for vastly different economic and public health policies.
The internet survey of about 1,300 heads of household across the country, conducted throughout the month, gauges perceptions of the labor market and personal finances. The same participants participate for up to 12 months, with a roughly equal number rotating in and out each month.
While respondents felt the chances of losing a job had fallen to 15.48% from 16.59% in September, they were more pessimistic when asked how likely they were to find a new job in the next three months if they’d just lost one. The mean probability of finding a new job had hovered near 60% before the pandemic began, but in October it was just 46.90%, a smidge lower than the 46.95% recorded in April—at the height of the pandemic lockdown—and well below the 49.86% recorded in September. The last time it was lower was in April 2014.
Meanwhile, the chances respondents would voluntarily leave their job over the next 12 months fell from 20.33% to 17.87%—the lowest since April of this year.
Feelings about household finances were a little gloomier than in September, with respondents expecting household income to grow a median 2.11% over the next year, down from 2.27%, and household spending to grow 3.06% over the next year, down from 3.35%. One bright spot: households reported just a 9.3% chance they would not be able to make minimum debt payments over the next 12 months, an all-time low for the survey.
Federal Reserve Bank of New York. "Survey of Consumer Expectations." Accessed Nov. 9, 2020.