The chances of getting a job in the US have dropped to a historic low of 44.9%, according to the New York Fed’s Survey of Consumer Expectations. Renaissance Macro Research noted that this shift highlights the struggles employers face in hiring rather than an increase in job losses. While the risk of being laid off hasn’t changed much, the chance of landing a new job after a layoff has greatly diminished. This drop in job-finding expectations raises concerns about the strength of the US employment market.

Crack In The US Labor Market

With the job-finding probability at a record low of 44.9%, it shows a serious issue in the US labor market. Even though the fear of losing a job is low, the significant drop in hiring confidence points to a potential slowdown in consumer spending. The August 2025 jobs report, which revealed only 115,000 new jobs—far fewer than expected—reinforces this caution. This change in consumer attitudes suggests that cautious investment in equities is wise for the coming weeks. We might want to look into buying put options on consumer discretionary ETFs like the XLY, as households are likely to cut back on non-essential purchases first. Historically, before the 2008 downturn, drops in consumer confidence often preceded a broader market correction. These insights also shape our perspective on what the Federal Reserve might do next. With hiring risks now outweighing the chances of layoffs, the likelihood of a rate cut this year has increased significantly; market expectations now suggest nearly a 60% chance of a cut at the November FOMC meeting. Traders should explore Fed Funds futures or options on treasury ETFs like TLT to prepare for a more lenient central bank policy.

Market Volatility Expectations

This rising uncertainty signals that we should expect higher market volatility. The VIX, currently around a relatively calm 16, seems undervalued given the new risks facing the economy. Buying call options on the VIX for October and November 2025 could be a smart hedge against potential market turbulence. Create your live VT Markets account and start trading now.

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