Key facts
- US consumer confidence hit a near 12-1/2-year low in September.
- Households expect business and labor market conditions to worsen.
- The Conference Board's consumer confidence index fell to 81.9.
- This is the lowest level for the index since April 2014.
- Job openings declined by 256,000 in August to 7.079 million.
- The ratio of job openings to unemployed persons fell to 1.01.
US consumer confidence plummeted to its lowest level in nearly 12-1/2 years in September, as households anticipate a worsening economic outlook, particularly concerning business and labor market conditions. The decline, detailed in a Conference Board survey, reflects growing pessimism driven by the Middle East conflict and rising interest rates.
The Conference Board's consumer confidence index fell 6.7 points to 81.9 this month, marking the lowest reading since April 2014. This figure fell short of economists' forecasts, which had predicted the index at 89.2. The drop in confidence was observed across various demographic groups, including political affiliation, age, and income.
Consumers' outlook on current and future expectations was largely negative, with particular concern over prices, the high cost of goods and services, and especially oil and gas prices, which reached new highs in write-in responses. The share of consumers describing jobs as "plentiful" decreased to 23.6%, the lowest since February 2021, while those viewing jobs as "hard to get" increased to 21.9%, the highest since January 2021. This narrowed the labor market differential to 1.7% from 4.2% in August, suggesting a potential rise in the unemployment rate.
Separately, a report from the Bureau of Labor Statistics showed that job openings, a measure of labor demand, decreased by 256,000 to 7.079 million by the end of August. Economists had anticipated 7.225 million open positions. The ratio of job openings to unemployed persons fell to 1.01, down from 1.06 in July, and significantly lower than the peak of around 2.0 in 2022. The decline in openings was most pronounced in professional and business services, as well as healthcare and social assistance sectors, though vacancies increased in retail, leisure and hospitality, and information sectors. Small businesses accounted for the entire decrease in job openings.