The recent federal government shutdown has significantly affected consumer sentiment in the United States, driving it to a near-record low in November. According to a monthly survey conducted by the University of Michigan, consumer sentiment fell by approximately 6%, with the consumer sentiment index for November 2025 recorded at 50.3. This figure is down from 53.6 in October and falls nearly three points short of economic forecasts. Economists surveyed by the Wall Street Journal had anticipated a more optimistic index reading of 53.0.
This latest decline in the monthly consumer sentiment index represents the lowest level since June 2022, when it reached 50.0, amid rising inflation during the COVID-19 pandemic. Remarkably, the current reading is the lowest recorded since at least 1978, highlighting growing concerns among consumers.
Joanne Hsu, the director of the survey, emphasized the widespread nature of this decline: “With the federal government shutdown dragging on for over a month, consumers are now expressing worries about potential negative consequences for the economy. This month’s decline in sentiment was widespread throughout the population, seen across age, income, and political affiliation.”
The decline in consumer sentiment coincides with a blackout on federal data, including the vital monthly jobs report, which was scheduled for release on Friday. The usual slate of reports has been suspended due to the ongoing government shutdown, prompting investors to seek insights from smaller, privately funded research entities.
This week, ADP, the largest payroll supplier in the US, reported that private employers added 42,000 new jobs in October. While this figure was better than expected, it still marks a significant slowdown compared to the three-month moving average of 188,000 jobs from November to January.
Additionally, Challenger, Gray & Christmas, an outplacement and executive coaching firm, revealed that US-based employers announced 153,074 job cuts in October. This figure represents a staggering 175% increase from the 55,597 cuts reported in October 2024, marking the highest level of layoffs for any October since 2003.
“Americans are losing faith in the economy because they’re losing ground,” stated Alex Jacquez, Chief of Policy and Advocacy at Groundwork Collaborative, in response to the Michigan survey report. He further criticized the current administration, asserting that “president Trump has no real interest in improving the lives of American families. His economic mismanagement has left households buried under record debt and rising prices. It’s no surprise consumer sentiment is at its lowest point since 2022, and households are turning to leaders who didn’t just learn the word ‘affordability.’”
As consumer sentiment continues to wane amid ongoing economic challenges, the implications for future spending and economic recovery remain uncertain. The combination of a federal shutdown, rising job cuts, and stagnant job growth paints a concerning picture for the US economy moving forward.
