Why a refreshing job market did not cool confidence

Despite a partisan fracture, the Americans feel a little better in personal finances

You would not know of the titles of the gloom of financial media, but Americans feel a little better About their personal finances that they were not a year ago.

The share of adults who say that their family and their families are less well subtitled than a year ago Lowered eight percentage pointsFrom 44% in September 2024 to 36% now, according to the latest survey of the Economist and Yougov. Most of this progress has been made by people who move in the ranks of those who say that their finances are “almost the same” as a year ago, which increased from 40% to 46%. The share saying that they are now better exceeded have increased by a point, from 14% to 15%.

These are not exactly floating figures. But fewer people have the impression of late is a significant clarification of the country’s mood.

Unsurprisingly, there was a lot of action under the upper line. Republicans feel much better in the economy. The share of the Republicans who say that they are better lotis have jumped from 17 points to 22% against five percent. The share saying that things are almost the same 21 points at 55%. The share saying that they are less well compensated went from 60% to only 21%.

The Democrats went to the opposite direction. The share saying that they are less well removed jumped from 22 points to 45%. The share of democrats claiming that their financial situation is almost the same increased from 49% to 43%. The share saying that they are better off went from 25% to 10%. Democrats certainly feel ugly.

It is obvious that the perception of people on their personal finances – or, at least, what they say about the probers on this perception – is strongly biased by political partisanry. But we are actually Less divided than we a year ago. The Republican net feeling – that is to say the share saying that they are better the share saying that they are less well subtitled – were 55 negatives a year ago, and the net democratic feeling was positive two, a gap of 57 points. Now, the Republican net feeling is positive, and the democratic feeling is 35 negative, a gap of 37 points.

In other words, fewer democrats feel that they are worse today than the Republicans did it a year ago.

The feeling among the self -employed has improved, Although in a very lesser extent that among the Republicans. The share saying that they are better lotie went from 12% to 14%. The share by saying that things are roughly the same past from 34% to 40%. The share saying that they are less well compensated went from 51% to 42%. The net feeling among the self -employed remains negative, a -28 points, but much less a year ago, when it was -39 points.

Americans are also Not very worried about employment safety. When asked by Yougov “to what extent are you worried about losing your job?”, 61% said that they were not very worried, slightly down compared to 63% a year ago. According to 11%, they are very worried, against nine percent a year ago. The somewhat worried part has not evolved at all at all 28%.

The paradox of 2025: fewer jobs, better mood

It is a remarkable resilience of the confidence given The slowdown in hiring. During the three months preceding September 2024, the economy was on average around 82,000 jobs. At the time, it seemed even better, at least according to official data which showed that we add an average of 121,000 jobs during the period from three months from June to August. The most recent average of three months is only 29,000 jobs.

What explains that? The layoffs remained weak. According to monthly job offers and work renewal (JOLTS), there were an average of 1.6 million layoffs each month in the second quarter of 2024. The second quarter of this year experienced an average of 1.7 million. The unemployment rate has barely moved, Going from 4.1% a year ago to 4.3% in August (the last month for which we have data). Thus, Americans who have a job are not very worried about losing them because few Americans lose their jobs.

The deceleration of employment growth is mainly motivated by offer rather than demand. Companies hire fewer people because the workforce increases more slowly. In the second quarter of last year, civil workforce increased an average of 352,000 each month. This year, this growth has slowed down to 110,000. This means that although employment growth has slowed down, the relationship between new entrants to new jobs has improved slightly. A year ago, the average payroll growth was 23% of the average workforce in the workforce in the second quarter. This year, he checked up to 26%.

Given that, Household expenses resilience It is not as much an enigma as many analysts think so. The job market is resistant well and actually does a little better job to absorb new workers. This gives households the confidence necessary to continue spending, which represents a large part of the reason why the economy increased by 3.8% in the second quarter and seems to increase solidly in the third quarter.

Americans spend because less feel like it is late, and they remain confident that they will keep their work.