Worker confidence sinks despite positive labor market signs
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By many measures, the labor market is showing signs of improvement. But American workers are less confident than ever in the companies that employ them.
Why it matters: The disconnect underscores a broader feature of the U.S. economy. The economic indicators policymakers rely on suggest stability, even as AI and persistent concerns about job security reshape how workers see their future.
By the numbers: About 43% of U.S. employees reported a positive six-month outlook for their employer's business in July, according to Glassdoor's Employee Confidence Index — the lowest on record in data going back to 2016.
- That's down sharply from the record 53% who said the same in 2022, when the labor market was the hottest in years.
What they're saying: "As energy prices rebounded in July and job security remains a top concern for workers, employee confidence continues to sour," Glassdoor chief economist Daniel Zhao wrote.
Zoom in: Confidence has deteriorated most dramatically among telecommunications workers, where it has fallen almost 14 percentage points over the past year.
- Other white-collar industries have also seen notable declines in employee confidence, including insurance, technology and aerospace and defense.
- Glassdoor linked insurance sector deterioration to cost-cutting and the adoption of AI to automate claims processing.
- Confidence has also dropped sharply in hotels and travel accommodation (-12 points) and restaurants and food service (-9 points) over the past year.
What we're watching: The confidence gap is widening inside companies. Entry-level and mid-career workers were more pessimistic in July, while confidence among senior employees improved.
- The divide reflects one key feature of the current labor market. Entry-level are bearing the brunt of a weak entry-level hiring market, where some employers are experimenting with AI to automate junior-level tasks.
