Growing Employee Confidence At Odds With Cooling Job Market

The WalletHub Economic Index for September 2024 shows confidence in personal finances is on the rise, but the newfound optimism does not entirely extend to confidence in new employment opportunities. 

The data reveal there was a 4.2% increase in overall consumer confidence from September 2023 to September 2024. This shows a greater number of people are feeling more positive about their finances now compared to last year, and they’re hopeful for more improvements in the next six months.  

However, not all employment metrics show a positive trend. Wallet Hub reports that confidence in the availability of new job opportunities has decreased by 2% compared to the previous year. 

 This decline suggests that while individuals feel secure about their current employment status, there is lingering uncertainty about the prospect of finding new jobs in the near future. 

This is further reflected in the rising national unemployment figures. Job growth in the U.S. has slowed, and unemployment has moved up to 4.2%. 

Despite labor market challenges, confidence in employee job retention over the next six months has increased by nearly 3% — which shows that employees feel more secure in their current roles.  

The heightened job security could lead to higher consumer spending, further driving the Fed’s plans to stimulate economic growth. Still, this newfound security does not negate the reality of fewer new job openings and slight rise in unemployment, which could pose challenges for Gen Z employees who are entering the job market or for those seeking new opportunities. 

The research coincides with a cooling labor market. As job growth slows and unemployment rises, companies are likely to prioritize employee retention over expansion plans. This could create a labor market environment where sectors will offer fewer job openings and more competitive recruitment processes.  

This could drive further trends in how workers approach career mobility, placing greater value on soft skills (i.e. interpersonal communication skills and leadership skills), and microcredentials to remain competitive.