Consumer sentiment fell about 5% from last month but remains above the low readings seen in April and May of this year, confirming its early-month reading.
Although September's decline was relatively modest, it was seen across a broad swath of the population, groups by age, income and education, said economist Joanne Hsu, director of the University of Michigan's Survey of Consumers. One key exception was seen among wealthy consumers; sentiment of consumers with larger stock holdings held firm from last month.
Overall, consumers report that the trajectories of labor markets and business conditions have both softened. Moreover, they expressed a weakening outlook for their personal finances as well.
"Weakening consumer views of labor markets are not necessarily a problem for consumer spending if they do not expect to be personally affected," Hsu said. "But in fact, responses to multiple survey questions all show that the financial outlook for consumers has deteriorated as well. These trends suggest that, for many consumers, robust spending will be difficult to maintain going forward."
Inflation worries weigh down views of personal finances
Current views of personal finances edged down this month and have fallen about 13% since the beginning of the year.
Consumers continue to express frustration over the persistence of high prices, with 44% spontaneously mentioning that high prices are eroding their personal finances, the highest reading since November 2024, Hsu said.
In addition, many consumers expect inflation to continue picking up in the year ahead, a sign that they do not believe that price pressures will be abating anytime soon. Tariffs still remain highly salient to consumers; about 60% of consumers provided unprompted comments about tariffs, compared with 65% in May 2025 and 28% in January 2025.
Consumers expect weakening income prospects
Consumers increasingly believe that labor market conditions will weaken. About 65% of consumers expect unemployment to rise in the year ahead, up from 57% in July 2025 and 35% a year ago.
Moreover, consumers expect to be personally affected by these anticipated trends. Consumers' expected probability of personal job loss grew sharply this year and ticked up in September to its highest reading since March 2025, suggesting that consumers are indeed concerned that they may be personally affected by any negative developments in labor markets, according to Hsu.
Nearly 70% of consumers expect inflation to exceed any income gains in the year ahead, up from less than 60% in September 2024. Taken together, confidence in incomes has ebbed, reducing a key factor that supported robust spending in 2022 even amid unfavorable levels of consumer sentiment.
Consumer Sentiment Index
The Consumer Sentiment Index fell to 55.1 in the September 2025 survey, down from 58.2 in August and below last September's 70.3. The Current Index fell to 60.4, down from 61.7 in August and below last September's 63.8. The Expectations Index fell to 51.7, down from 55.9 in August and below last September's 74.5.
About the surveys
The Surveys of Consumers is a rotating panel survey at the University of Michigan Institute for Social Research. It is based on a nationally representative sample that gives each household in the coterminous U.S. an equal probability of being selected. Interviews are conducted throughout the month by web. The minimum monthly change required for significance at the 95% level in the Index of Consumer Sentiment is 4.8 points; for the Current Economic Conditions Index and Index of Consumer Expectations, the minimum is 6 points.
