Consumer Confidence Falls to 81.9 in September as Labor Views Sour

US consumer confidence dropped 6.7 points to 81.9 in September, down from 88.6 in August, with the sharpest damage showing up in how Americans view the labor market — both today and six months out. The Conference Board's survey, conducted September 1–23, captured a federal funds rate hike and ongoing geopolitical tensions in its fieldwork window.

The Present Situation Index, which tracks consumers' assessment of current business and labor market conditions, retreated 7.9 points to 109.3. The Expectations Index, covering the short-term outlook for income, business and labor conditions, fell 5.9 points to 63.6 — its third consecutive monthly decline.

"The Consumer Confidence Index deteriorated notably in September, following two prior months of softening," said Dana M. Peterson, Chief Economist at The Conference Board. "Consumer appraisals of current business conditions became negative for the first time since September 2024. Perceptions of the current labor market also worsened, though remained within positive territory."

What the labor market numbers say

For anyone tracking their position in the job market, the internals matter more than the headline. The labor market differential — the share of consumers saying jobs are "plentiful" minus the share saying jobs are "hard to get" — narrowed by 2.5 percentage points to just +1.7%. In concrete terms, 23.6% of consumers said jobs were plentiful, down from 24.5% in August, while 21.9% said jobs were hard to get, up from 20.3%.

A differential of +1.7% is thin. It signals a labor market that consumers still describe as net-positive, but barely. A year of deterioration at September's pace would push the measure negative — the zone where job seekers lose leverage and wage growth typically cools.

The forward-looking picture weakened too. Net expectations for the labor market fell 3.1 percentage points to –14.4%. Only 14.0% of consumers expected more jobs to become available over the next six months, down from 14.8%, while 28.4% expected fewer jobs, up from 26.1%. For workers weighing a move or a negotiation, that gap — nearly twice as many people expect contraction as expansion — is the number to watch.

Income expectations softened as well. The share expecting their income to rise over the next six months fell to 17.9% from 19.0%, while those expecting a decline rose to 15.4% from 13.5%. Net income expectations stayed positive at +2.5% but lost 3.0 percentage points on the month.

"Over the next six months, consumers expected both business conditions and the labor market to weaken," Peterson said. "Consumers still anticipated their household incomes to rise, but less so compared to previous months."

Business conditions and the broader backdrop

Net views of current business conditions turned negative for the first time since September 2024, declining 3.4 percentage points to –1.9%. Some 18.5% of consumers called conditions "good" (down from 18.8%), while 20.4% called them "bad" (up from 17.3%). Six months out, net business expectations slid 3.2 percentage points to –9.5%.

Inflation expectations climbed. Average 12-month inflation expectations rose 0.3 percentage points to 6.1%, with the median at 5.1%. The share anticipating higher interest rates over the next year jumped 5.2 percentage points to 68.4%. Peterson noted that write-in responses about prices — particularly oil, gas and the cost of goods and services — rose to new heights, reflecting September's surge in fuel costs.

Confidence fell across all age groups, nearly all income groups and every political affiliation. Households earning $125,000–$149,000 reported the largest decline over the past six months on a moving-average basis, while Gen Z and Millennials remained the most optimistic generations.

Views of family finances turned negative: the share calling their current finances "bad" overtook those saying "good" for only the second time in the four years the question has been asked. Recession expectations ticked up, and planned spending on services pared back again — though 42.6% of consumers still planned a vacation in the next six months, a 0.5-point rise driven entirely by domestic travel.

The results are preliminary, with a cutoff date of September 23; The Conference Board typically revises the index once full-month data come in. October's reading will show whether the third straight drop in expectations hardens into a trend that employers and job seekers act on.