Struggling Households Struggle to Find Job Opportunities, Citing Decreased Prospects
A recent survey of over 1,330 employed individuals reveals a pessimistic outlook on the job market for the next few months. The survey, which did not provide specific data for the latest day, states that the results will not change the overall negative sentiment.
The survey asked about the likelihood of finding a suitable job, defined as one that meets qualifications and desired income. No majority of respondents, regardless of income level or financial stability, considered finding a suitable job as "very" or "extremely" likely. Most respondents saw at best a slim chance of landing a suitable job, with many deeming it "not at all" likely.
The unemployment rate reached a multi-year high of 4.3% in August, up from July and June. Among the unemployed, the percent of new entrants fell back to 10.8% in August, down from the decade high of 13.4% in July.
The automotive industry and retail sector have particularly intensified job cuts for lower-wage employees in August, with the auto industry cutting about 7% of all jobs within a year, equating to over 50,000 positions lost. On the other hand, the public sector, tourism, and construction have been less affected or even hiring.
Manufacturing employment changed little in August (-12,000) but is down by 78,000 over the year. Wholesale trade employment continued to trend down in August (-12,000) and has fallen by 32,000 since May. Federal government employment declined in August (-15,000) and has fallen by 97,000 since reaching a peak in January.
Surprisingly, 45% of respondents making more than $100,000 annually and not living paycheck to paycheck shared similar pessimistic views. This sentiment was consistent across all respondents making less than $50,000 annually.
Despite the pessimistic outlook, there were some positive signs. Average hourly earnings for all employees on private nonfarm payrolls rose 0.3% to $36.53 in August. Over the past 12 months, average hourly earnings have increased by 3.7%, outpacing the 2.6% yearlong increase in prices as measured by the PCE. In August, healthcare added 31,000 jobs, but this is below the average monthly gain of 42,000 over the prior 12 months.
The unemployment rate was last higher in October 2021 (4.5%). The survey did not provide specific data for the latest day, but it is stated that the results will not change the overall pessimistic outlook.
