U.S. consumers’ confidence in the economic outlook fell sharply in April, driven by rising concerns over trade policy and financial market volatility, even as their assessment of current business and labor market conditions remained steady, according to a report released Tuesday by the Conference Board.
The Conference Board’s Consumer Confidence Index dropped 7.9 points to 86.0, the lowest reading since May 2020. The decline was fueled almost entirely by a steep fall in the Expectations Index, which measures consumers’ views on business conditions, income prospects, and the labor market six months ahead. Expectations fell to 54.4, the lowest since October 2011 and well below the level that often signals consumer anxiety about potential recession.
In contrast, the Present Situation Index — which tracks consumers’ views of current economic conditions — slipped only slightly, falling by less than one point to 133.5. Consumers were modestly more positive about current business conditions compared with March, and only slightly less upbeat about the availability of jobs, signaling that day-to-day economic realities remain healthy despite mounting concerns about the future.
“Consumer confidence declined for a fifth consecutive month in April, falling to levels not seen since the onset of the COVID pandemic,” said Stephanie Guichard, Senior Economist, Global Indicators at The Conference Board. “The decline was largely driven by consumers’ expectations. The three expectation components—business conditions, employment prospects, and future income—all deteriorated sharply, reflecting pervasive pessimism about the future.”
The report revealed that the share of consumers expecting fewer jobs over the next six months rose to 32.1 percent, the highest since March 2009. However, the broader context is dramatically different: In March 2009, the U.S. unemployment rate stood at 8.7 percent and was rising sharply as the economy lost more than 700,000 jobs per month. Today, the unemployment rate is less than half that level, layoffs are declining, and job openings remain historically elevated, suggesting that pessimism may be more sentiment-driven than reflective of actual labor market conditions.
Write-in survey responses showed that tariffs were top-of-mind for many consumers, with mentions of tariffs reaching an all-time high. Consumers also cited concerns about inflation and stock market volatility. However, broader economic indicators continue to show resilience: retail sales rose in March by the most in over two years, hiring has remained steady, and inflation has broadly cooled from earlier highs.
Expectations about personal finances also turned more negative, with a larger share of consumers expecting incomes to decline over the next six months. Still, the majority of consumers continue to rate their current financial situations positively, and plans for major purchases such as appliances and electronics were mostly higher on a six-month moving average basis compared with earlier periods.
While fears about tariffs and higher prices have influenced sentiment, there is little evidence so far that consumer anxiety is significantly impacting actual economic behavior. Job openings data released on Tuesday showed that private sector demand for workers remains strong, with openings ticking up in manufacturing. Government openings fell, highlighting progress the Trump administration is making in its efforts to “reprivatize” the U.S. economy.
Consumer expectations are often a lagging indicator for economic conditions. In 2020, consumer confidence fell sharply in July and August—amid a renewed surge in coronavirus infections in the South and West—even as the economy was already on the rebound, growing at a breakneck 33.8 percent annualized pace.
The Conference Board’s data suggests a similar divergence may be unfolding now: despite heightened concern about future conditions, consumers’ lived experience of the economy today remains largely positive