A volatile economy negatively impacts how U.S. workers feel about job security.
By Larry Basinait
The U.S. Worker Confidence Index (WCI) gathers feedback from American employees to measure how confident and secure they feel in their jobs. Several indices examine the labor market and attitudes about the economy, but they do not address the employee perspective to evaluate their attitude and perceived level of job security. HRO Today and Yoh Recruitment Process Outsourcing have been producing the WCI since 2014.
According to the latest results, U.S. workers felt less confident in their jobs in the fourth quarter of 2024 compared to the third. Job security and trust in company leadership were at their lowest points in two years. Confidence in getting a raise also dropped, but confidence in getting a promotion rose slightly. These are the other key findings.
• Worker confidence dropped in the fourth quarter by 3.7 points to 107.7. Confidence fell across most demographic segments, particularly for women.
• Workers felt less confident in most areas of work, especially in getting a raise. Job security fell once again this quarter by 3.8 points after it peaked in the second quarter. Confidence in the likelihood of a raise fell the most—by 7.0 points—and trust in company leadership fell by 5.9 points. Confidence in a promotion was the only area to increase up 2.0 points. Every area of work measured by the WCI was down year-over-year.
• Remote workers had the lowest level of worker confidence.  The lack of confidence was driven by a much higher fear of job loss than either hybrid or onsite workers.
• Trump’s win did not improve confidence for Republicans. Worker confidence fell in all major political parties. Even though it decreased the most for Democrats, the political party still maintained the highest level of confidence overall. The outcome of the election did not increase confidence for Republican workers, although their confidence diminished the least.
Here’s a look at how the WCI results fit into the bigger picture of the U.S. economy and labor market.
• The labor market outperformed in 2024. The unemployment rate edged down to 4.1%, one-tenth of a point below analyst expectations. In 2024, employment grew each month, though inconsistently and at times raising questions over whether a recession loomed. However, the final two months showed a labor market still operating at strength.
• The Fed continued to cut interest rates. The Fed began cutting in September 2024. The federal-funds target range now stands between 4.25% and 4.50%, after staying between 5.25% and 5.50% from July 2023 to September 2024.
• Stocks ended the year on a high. Stocks ended 2024 near record highs. In 2024, the Nasdaq Composite rallied 30% and the S&P climbed 500 to over 24%. Meanwhile, the blue-chip Dow Jones rose a more modest 13%. But concern over tariffs could negatively impact the stock market early in 2025.
• U.S. consumer confidence pulled back in December and in January. The Conference Board Consumer Confidence Index® declined by 5.4 points in January to 104.1 (1985=100). December’s reading was 109.5, down 3.3 points from the previous month.
The WCI and CCI have a predictive relationship. At least two-thirds of the time, when the WCI goes up (or down) in one quarter, the CCI will go up (or down) in the next. Because the WCI went down this quarter, the study predicts the CCI will go down next quarter.
Looking Forward in 2025
While the U.S. economy is set to start 2025 on strong footing after a year of surprisingly robust growth, a combination of proposed policies will likely weigh on growth and leave inflation elevated as the year progresses, resulting in a more patient policy stance from the Fed. The labor market strength supporting solid growth in personal income for consumers and the post-election revival of animal spirits in selected industries will likely contribute to continuation of strong growth momentum in the first half of the year. However, tariff and immigration policies will likely weigh on growth, suggesting somewhat slower economic activity in the first half of the year.
