Consumer Confidence Plunges In US As People Worry About Their Jobs

Consumer confidence in the United States has plunged the most in years as Americans worry about their jobs.

The index fell in September to 98.7 from 105.6 in August.

"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.

Views of the labor market situation weakened and consumers were also more pessimistic about future labor market conditions and less positive about future business conditions and future income.

The drop in confidence was steepest for consumers aged 35 to 54 with consumers earning less than $50K experiencing the largest decrease.

Despite slower overall inflation and declines in some goods prices, average 12-month inflation expectations increased to 5.2% in September.

The report found that consumer buying plans for big-ticket appliances were mixed and plans to buy a smartphone or computer in the next six months eased.

However, purchasing plans for homes and new cars improved slightly and consumers were still planning to travel and dine out in September. It found that consumers were still willing to stream entertainment at home but that interest in going to the movies rose in recent months. Regarding non-discretionary services like health care and utilities, planned spending over the next 6 months was also strong.

Family Finances and Recession Risk

• Consumers' assessments of their Family's Current Financial Situation weakened further.
• Consumers' assessments of their Family's Expected Financial Situation going forward were also less optimistic.
• Consumers' Perceived Likelihood of a US Recession over the Next 12 Months ticked up in September but remained well below the May 2020 peak.