As of April 2025, a staggering 67% of U.S. consumers expect unemployment to rise over the next 12 months. This is the highest level of job market pessimism recorded since 2009, eclipsing even the widespread concerns during the 2008 financial crisis. The percentage of consumers anticipating higher unemployment has more than doubled in just the past five months, indicating a sharp and sustained shift in sentiment.
This spike in expectations is not an isolated data point—it follows a consistent rise over five consecutive months. Historically, such rapid and substantial increases in consumer anxiety about job losses have often preceded actual spikes in the unemployment rate. When public sentiment becomes this negative, it often reflects underlying economic stresses that later manifest in the labor market data.
Looking back over the last few decades, comparable surges in consumer expectations of rising unemployment have been tightly correlated with major economic downturns:
In the early 2000s, during the dot-com crash and the recession that followed, expectations spiked to around 60%.
The 2008-2009 global financial crisis saw expectations peak at nearly 70%, right before the job market collapsed.
In contrast, the post-2010 period maintained relatively stable consumer expectations, generally hovering between 20% and 35%, with few major spikes until recent years.
During the onset of the COVID-19 pandemic in 2020, expectations quickly jumped, but even then, the spike was slightly lower than what we’re now seeing in 2025.
The early 2020s saw renewed anxiety with expectations briefly hitting the 40% range during inflationary surges and recession fears, but again, this was significantly below the current 67%.
What’s particularly alarming is that current pessimism about job losses now surpasses levels seen before or during previous major recessions, including the downturns of 1981–82, 1990–91, and 2001. The fact that consumer sentiment has surpassed these historical benchmarks suggests a deeper unease about the future of the U.S. economy.
Such a high level of public concern signals that many Americans are bracing for economic hardship. Whether due to slowing growth, tightening monetary policy, or geopolitical uncertainty, consumers appear to be anticipating a wave of layoffs or hiring freezes.
In the past, these sentiment shifts have not only preceded economic slowdowns but have also fed into them. As consumers grow cautious, spending typically declines, which can contribute to the very economic slowdown they fear.
The current figure of 67% stands as a powerful indicator of consumer anxiety—and potentially a warning sign for what lies ahead in the U.S. labor market.
Credit:Consumer sentiment data sourced from the University of Michigan, April 11, 2025
