Americans are at their most pessimistic about the job market since the Great Recession, with concerns over unemployment and inflation reaching a 14-year high. The University of Michigan’s latest monthly survey found that 62% of consumers believe unemployment will worsen in the year ahead, a level not seen since 2008.
The surge in pessimism is linked to President Trump’s plan to impose steep tariffs on foreign goods, which has sparked fears of job losses and an inflation resurgence. However, economic conditions are strikingly different from last time, with the unemployment rate remaining at historically low levels, around 4.2% as of July.
Despite concerns, consumers’ fears have not been self-fulfilling, with signs of healthy shopping patterns this summer. The July jobs report, which showed slower hiring and fewer layoffs, has strengthened the case for interest rate cuts in September to shield the labor market.
Consumer anxiety is paired with worries about inflation, but experts say that while CPI inflation may not have surged yet, consumers are still bracing for an increase in the future. The situation is reminiscent of last summer’s economic downturn, when a record-low share of Americans anticipated higher unemployment, but economists note that the current labor market is more resilient than before.
Source: https://www.axios.com/2025/08/16/job-market-great-recession