Workers are sour on the job market — but it may not be warranted

Workers are sour on the job market — but that pessimism may be somewhat misplaced.

The Glassdoor Employee Confidence Index in January fell to its lowest level since 2016, when the career site began tracking the metric, it said Monday. The index measures how workers feel about their employer’s six-month business outlook.

The decline suggests job security is a “prominent” worry, said Daniel Zhao, lead economist at Glassdoor. “It’s a signal that employees are concerned heading into 2024,” he said.

That deterioration is likely due to a wave of layoff announcements in recent weeks, Zhao said.

So far in 2024, for example, big technology firms including Amazon, eBay, Google and Microsoft have announced job cuts. But it’s not just tech. Others such as BlackRock, Citigroup and Universal Music Group also announced layoffs.

U.S.-based companies planned about 722,000 job cuts in 2023, almost double those announced in 2022, according to Challenger, Gray & Christmas, an outplacement and executive coaching firm.

However, those recent headlines mask strength in the overall job market, economists said.

From a worker’s perspective, things “don’t get any better,” said Mark Zandi, chief economist at Moody’s Analytics.

Despite pockets of layoffs in certain industries such as tech, Zandi said job cuts across the broad U.S. labor market continue to hover near historic lows, where they’ve been since spring 2021.

New claims for unemployment insurance are in line with their pre-pandemic trend in 2019, which economists describe as a period of labor market strength. The unemployment rate has also been below 4% for two years.

Indeed, when it comes to the average annual unemployment rate, 2023 was the sixth-best year on record, ranking only behind a few years in the 1950s and 1960s, said Julia Pollak, chief economist at ZipRecruiter.

“It’s still a very robust and resilient labor market overall,” Pollak said.