Consumer confidence drops sharply in U.S. amid job-market worries

 

Consumer confidence drops sharply in U.S. amid job-market worries

In September 2025, U.S. consumer confidence fell significantly, as concerns about job availability and business conditions mounted. The Consumer Confidence Index dropped to its lowest point since April, with consumers indicating uncertainty about both their present situation and the near-term outlook. Much of this unease stems from a cooling labor market, where new job openings are fewer and wage growth is under pressure.

Despite this softening sentiment, actual spending on essentials remains relatively resilient, even though consumers report cutting back on discretionary purchases. Economists warn of a disconnect: while people continue to spend out of necessity or inertia, their mood (and therefore their future spending plans) is cautious.

Inflation remains a top concern. Even though prices overall are rising more slowly than in previous years, many households are still being squeezed by high housing, food, and energy costs. Expectations for future inflation have slightly moderated, but many consumers doubt that inflation will return to comfortable levels soon.

Retail and service sectors are likely to feel the impact if confidence does not recover. Big-ticket items and non-essentials typically suffer first. Some businesses are keeping inventories light and delaying expansions or hiring.

For policymakers and businesses, the current moment requires careful balancing. Stimulating demand could help prevent a downturn, but excess stimulus risks reigniting inflation. Clear communication about job policy, inflation projections, and interest rates will be key to managing expectations.

For professional inquiries and collaborations, you can connect with the economic writer Abdalla Hilal via LinkedIn: linkedin.com/in/abdalla-hilal-6356431a5.