Americans grew more worried about losing their jobs last month even as employers kept hiring, according to a Federal Reserve survey released on Monday, with expectations that unemployment will rise reaching their highest level since the early weeks of the Covid-19 pandemic.
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| File photo: The Federal Reserve building in Washington, D.C. The New York Fed's October survey found Americans' expectations of higher unemployment at their highest since April 2020. |
The October Survey of Consumer Expectations from the Federal Reserve Bank of New York, released on Monday, November 9, found that Americans' projections that the jobless rate will be higher a year from now stood at their highest since April 2020, a reading last seen during the tumultuous early stages of the pandemic. The result captures a strange split in the American economy: the official numbers say the labor market is holding up, but ordinary people increasingly expect it to get worse.
The Survey's Key Findings
The New York Fed's monthly survey, which asks households about their expectations for inflation, jobs, income and spending, delivered a mixed picture of the labor market in October. Respondents said they saw a greater chance of involuntarily losing a job, although that expectation was still at relatively low levels, according to Reuters, which reported on the survey's release.
At the same time, the survey found a brighter spot: Americans said their chance of finding new work after a job loss was higher in October. The New York Fed said job-finding expectations reached their highest level since November 2025, a sign that workers still believe they can land on their feet if they are let go.
Households' view of their own finances also held up better than the jobs anxiety might suggest. The survey found that families' view of their current financial situations improved a bit relative to September, while expectations for their finances a year from now were steady in October. Access to credit, now and in the future, was unchanged, according to the report.
The survey was conducted over the course of October, as Americans were in the run-up to pivotal midterm elections that ultimately led to broad-based Democratic gains, including control of both houses of Congress. Voters went to the polls as other surveys showed a sour mood across the nation, and Reuters noted that Americans have struggled with the high inflation unleashed by President Donald Trump's trade tariffs and the Middle East war.
A Strong Jobs Report, a Nervous Public
The anxiety in the survey stands in sharp contrast to the government's own jobs numbers, which arrived just three days earlier and told a much stronger story. On Friday, the government reported that the job market showed unexpected strength in October, with employers adding 165,000 jobs, far above the roughly 65,000 that economists had expected, while the unemployment rate eased to 4.1 percent.
The report also contained strong upward revisions to recent hiring data. Employment gains for August and September were revised up by a combined 84,000, suggesting the labor market was more resilient than previously estimated. Average hourly earnings rose 0.4 percent from the previous month and 3.1 percent from a year earlier, showing that wage growth has not yet cooled in any clear way.
Federal Reserve officials have regularly described the current job market as "low-hire, low-fire," a phrase that captures the odd calm: few workers are being laid off, but few are being hired either. That description helps explain why the survey's findings are not contradictory. A worker can feel secure in a job today, see little hiring around them, and still worry that the next turn in the economy will be a bad one.
The broader economy has also kept growing. The Commerce Department reported in late October that the economy grew at a 3.4 percent annual pace in the third quarter, beating forecasts, with business investment in the artificial intelligence buildout and resilient consumer spending doing much of the work. Wholesale inventories rose an upwardly revised 0.7 percent in September, with stocks of electrical goods surging 2.5 percent as businesses spend aggressively on AI.
Yet the public mood has not followed the data. A separate University of Michigan survey released in October showed consumer sentiment near a record low, with households worried about prices and the direction of the country. The New York Fed's survey adds a new piece to that puzzle: the worry is no longer only about prices at the store, but about the paycheck itself.
Inflation Expectations Stay Stuck Above Target
The survey's inflation findings will matter just as much to the Federal Reserve as the jobs numbers. Respondents see inflation a year from now at 3.9 percent, three years from now at 3.3 percent and five years from now at 3 percent, all levels that matched the September survey and all well above the Fed's 2 percent inflation target.
The New York Fed's report is most closely watched for exactly these readings on the outlook for inflation, and the message from households is that price pressures are not expected to fade quickly. Expectations across a range of commodities were mixed, with households seeing a more moderate increase in gasoline prices a year from now than they saw in September. Home price expectations were steady, with prices seen rising 3 percent over the coming year, according to reports of the release.
Fed officials are broadly expected to raise interest rates at the early December policy meeting as they work to bring current inflation back to target, with markets pricing around a 78 percent chance of a quarter-point increase after the strong payrolls report. The next big test comes on Tuesday, when the government releases October consumer price data, followed by producer prices on Friday.
Chicago Fed President Austan Goolsbee said on Monday that employment and growth are "actually pretty stable," adding that the big problem has been on the inflation side, according to reports of his remarks. That framing matches the survey: the jobs picture looks steady in the official data, while inflation remains the stubborn problem.
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| File photo: Job seekers speak with recruiters at a job fair. The survey found Americans saw a greater chance of losing a job in October, but also a better chance of finding new work. |
What This Means
The survey matters because expectations shape behavior. When people expect unemployment to rise, they tend to spend more cautiously, save more, and put off big purchases, even if their own job feels safe today. That caution can itself slow the economy, which is why central bankers watch household expectations so closely.
The split inside the survey is also telling. Americans are more worried about losing a job, but also more confident they could find another one. That combination fits a labor market in which layoffs remain low but hiring has slowed: workers sense the ground shifting beneath them, yet still believe their skills are in demand. It is a picture of unease rather than panic, and it helps explain why the public mood has stayed sour even as the headline numbers look healthy.
The timing adds a political edge. The survey was taken during the midterm campaign, and voters handed Democrats control of both chambers of Congress on November 3. The election was fought in part over the cost of living, and the survey suggests the anxiety that shaped the vote has not faded with the result.
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| File photo: A 'Help Wanted' sign in a storefront window. Friday's jobs report showed U.S. employers added 165,000 jobs in October. |
What Happens Next
The next clues arrive quickly. October consumer price data is due on Tuesday, November 10, and will show whether inflation is cooling or staying hot ahead of the Fed's December 8-9 policy meeting. Jobless claims follow on Thursday, and producer prices land on Friday, giving the Fed a fuller picture before it decides on rates.
If inflation comes in hot again, the case for a December rate increase strengthens, and the Fed will have to weigh that against a public that is already anxious about jobs. If prices cool, officials may have room to wait. Either way, the New York Fed's next survey, due in early December, will show whether Americans' job fears keep climbing or start to ease now that the election is over and the hiring data is in front of them.
For now, the message from households is clear: the jobs report says the economy is fine, but Americans are not so sure.
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