MNI POLICY:Job Search Optimism Lowest Since 2014-NY Fed Survey

U.S. consumer views of finding a new job fell to the lowest since 2014 last month while measures of spending and household income weakened, the New York Federal Reserve's latest consumer survey showed on Monday.

The mean perceived probability of finding a job, if one's current job was lost, declined to 46.9% from 49.9% in September, its lowest reading since April 2014 and well below the 2019 average of 59.9%. The decline was broad-based across education and income groups.

Median household spending growth expectations fell in October to 3.1% from 3.4% in September, the lowest since February before the pandemic took hold. Expected household income growth decreased by 0.3 percentage points to 2.1% in October, below the 2019 average of 2.8%.

One-year ahead expectations about households' financial situations deteriorated slightly with fewer respondents expecting their financial situation to improve and more respondents expecting their financial situation to worsen, the internet-based survey with a rotating panel of 1,300 households showed.

The FOMC has long warned that early strength in the economic recovery from Covid-19 needs more fiscal support to help struggling households and business owners, though sources have told MNI that election results suggest less incentive for a major new package. Senate Republicans have continued to say that a smaller plan of USD500 billion is what's needed, a fraction of what House Democrats have sought.

SOME JOB MARKET RESILIENCE

Median one-year ahead expected earnings growth remained flat at 2.0% in October for the third consecutive month, with the series still well below the 2019 average level of 2.4%.

There were some signs of resilience in the job market. The mean expectation that the U.S. unemployment rate will be higher in a year dipped to 35.4% from 36.4% in September, the third consecutive decline. And the mean perceived probability of losing one's job over the next year decreased to 15.5% from 16.6% in September, remaining above its February level of 13.8%.

The mean probability of leaving one's job voluntarily over the next year declined substantially to 17.8% from 20.3% in September, a broad-based decline across demographic groups.