In January, U.S. consumer confidence plunged significantly to mark its lowest point since 2014, underscoring escalating apprehensions regarding personal financial situations. The Conference Board revealed that its consumer confidence index slid 9.7 points to 84.5, undercutting even the worst readings recorded throughout the COVID-19 pandemic. This considerable decline highlights an intensifying anxiety among Americans about their economic future.
The segment of the index measuring short-term expectations related to household income, business circumstances, and employment fell sharply by 9.5 points to 65.1, remaining well below the 80 threshold that financial analysts often associate with looming recession risks. This marked the twelfth month in succession where this barometer has persisted under that critical level.
Simultaneously, consumers’ evaluation of the current economic environment weakened by 9.9 points to 113.7. Dana Peterson, chief economist at the Conference Board, remarked on the breadth of the decline, stating, "Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened. All five components of the index deteriorated, driving the overall index to its lowest level since May 2014 — surpassing its COVID-19 pandemic depths."
Concerns related to inflation remained prominently entrenched in consumer responses, with frequent mentions of rising costs for gasoline and groceries. Additionally, references to tariffs and trade conflicts increased, alongside growing unease about political developments, labor market dynamics, health insurance, and ongoing global conflicts.
Perceptions concerning job availability also declined during the month. Notably, only 23.9% of survey participants described jobs as “plentiful,” a decrease from 27.5% the previous month. Meanwhile, the share of those who considered employment opportunities “hard to get” rose from 19.1% in December to 20.8% in January.
Economists characterize the U.S. labor market as experiencing a “low hire, low fire” condition, where businesses are cautious about moving on employment fronts because of uncertainties surrounding tariffs announced by the previous administration, as well as persistent high interest rates. Government data released earlier indicated an extremely subdued pace of job creation, with only 50,000 positions added in December, which is similar to November’s figure of 56,000. The unemployment rate stood at 4.4%.
Job creation has remained modest throughout the year, particularly after the surge of tariffs implemented in April — often referred to as “liberation day” tariffs. In 2025, the economy generated a total of just 584,000 jobs, a stark contrast to over 2 million created in the preceding year of 2024. Heather Long, chief economist at Navy Federal Credit Union, linked the sharp downturn in consumer confidence directly to this employment slowdown: “The dramatic drop on confidence is a direct result of the hiring recession. The fact that 2025 was the weakest year for job gains outside of a recession since 2003 is not going over well with the middle class.” She added a cautionary note for policymakers, emphasizing the need to prioritize affordability and stimulate hiring in the year ahead.
This slackening in labor market strength arrives despite ongoing economic expansion in the U.S., driven mainly by robust consumer spending. According to the government’s latest estimates, the economy recorded its fastest growth in two years during the period from July through September. The tension between this growth and subdued employment gains reflects a complex and cautious economic landscape.