Americans think they’ll be unemployed and looking for jobs at 10-year high: NY Fed survey

More Americans are looking for jobs and unemployment concerns are at their highest level in a decade, according to a new survey released by the Federal Reserve Bank of New York on Monday.

According to the NY Fed, the expected average unemployment rate over the next four months reached 4.4% in July, the highest in the survey’s 10-year history. This compares to 3.9% last year.

The expected probability of moving to a new employer has also increased, rising to 11.6% last month from 10.6% seen in July 2023.

Most respondents are also actively looking for work, with 28.4% saying they have been looking for a new job in the past four weeks – the highest level since March 2014 and an increase from 19.4% by July 2023.

The survey also noted a decrease in satisfaction with salary compensation, unpaid benefits, and opportunities for promotion in respondents’ current jobs, which comes as the Federal Reserve measures recent labor market weakness by The unemployment rate is now at 4.3%.

Investors will also be closely watching the expected annual update from the Bureau of Labor Statistics (BLS), which could cut as many as a million jobs from the job growth previously reported last year.

Economists and policy experts have warned that any slowdown in the labor market could have a negative impact on markets.

“The problem is that we continue to see weakness in the labor market and we think that is what will bring this market down,” Ahmed Riesgo, chief investment officer at Insigneo, told Yahoo Finance on Tuesday.

“We know that the US consumer is doing well, but the US consumer is doing well because they still have a job. The second is that the job market is going from one high-income one to another.” of the deficit, which we think we’re approaching very quickly, we think the US consumer, unfortunately, is going to falter.”

Recent data, however, have presented a more positive economic picture.

Consumer prices have continued to soften near the Fed’s 2% inflation target. Good retail sales data for the month of July showed consumers are spending money. Consumer confidence is increasing. And the latest reports of initial unemployment benefits have fallen more than expected.

“We’re going down in extraordinary circumstances [in the unemployment rate] after an unusual period during this pandemic,” Joe Brusuelas, chief economist at RSM, told Yahoo Finance on Tuesday.

“A lot of the rules that some of these so-called forward-looking investors are using are not going to work this time because the economy is in a very different place.”

The story continues

Because of those signs, which indicate that the US economy may enter a “Goldilocks situation” where growth is growing while inflation is falling, traders are looking to Jackson Hole for clues about what might come next.

“I think [the Fed] “It will have to go according to specifications,” ING chief international economist James Knightley told Yahoo Finance on Tuesday. they are the only thing that can happen.”

Markets are currently pricing in an almost 100% chance that the Federal Reserve will cut interest rates at the end of its September meeting. The odds of a 25- or 50-point rate cut are now split about 70/30 after last week’s 50/50 odds, according to the CME FedWatch Tool.

Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow him to X @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com.

Click here for the latest stock market news and in-depth analysis, including stock-moving events

Read the latest financial and business news from Yahoo Finance