Americans growing more worried about jobs amid rising prices, finds NY Fed survey

Americans grew increasingly concerned about the US labour market in October, with expectations of a higher unemployment rate over the next year reaching their highest level since April 2020, according to a survey released by the Federal Reserve Bank of New York on Monday.

The New York Fed’s October Survey of Consumer Expectations showed that households anticipated a greater likelihood of involuntary job losses, although the perceived risk remained relatively low. However, respondents also expressed greater confidence in their chances of finding employment after losing a job.

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The growing pessimism over employment came alongside expectations that inflation would remain elevated. Consumers projected inflation at 3.9% over the next year, 3.3% over three years and 3% over five years, unchanged from September. All three readings remain above the Federal Reserve’s 2% inflation target.

Expectations for commodity prices were mixed, with households anticipating a more moderate rise in gasoline prices over the next year compared with their September projections.

The survey’s findings contrasted with official employment data released on Friday, which showed the US economy added 165,000 jobs in October, while the unemployment rate edged down to 4.1%. The report also included significant upward revisions to recent hiring figures.

Also Read: Fed’s Barkin urges rate policy caution, Goolsbee warns of inflation concerns as AI risks loomMeanwhile, households reported a modest improvement in their current financial situations, while expectations for their finances over the next year remained unchanged. Perceptions of access to credit, both currently and in the future, were also steady.

The survey was conducted throughout October, ahead of the US midterm elections, which resulted in broad-based Democratic gains, including control of both houses of Congress.