Workers are increasingly anxious about losing their jobs as executives threaten to replace them with AI, according to a Federal Reserve Bank of New York survey—but that still won't entice job hunters to lower their salary expectations for a new role.
Every four months, the NY Fed asks about 1,000 people about their job situation and outlook—and the share of people who think they’re likely to be unemployed in the next four months has reached a record high.
The July survey found that 4.4% of respondents expect to lose their jobs in the near future. To put that into context, the only other time it’s ever hit 4% was when the pandemic struck in March 2020.
It comes as workers are increasingly facing threats to their livelihood because of AI and economic uncertainty—or as Korn Ferry put it in a recent report, the “perfect storm” for mass unemployment.
Just last week, tech giant Cisco laid off thousands of workers as it announced it was going to invest more in AI instead.
At the same time, employers aren’t hiring or backfilling roles regardless of whether they’ll be impacted by emerging technology because, according to Korn Ferry, they’re waiting to see if the economy picks back up.
A report from the Labor Department indicated the U.S. economy added around 61,000 fewer jobs last month than expected.
Workers still holding on to their pay expectations
But despite fears they may be jobless soon, today’s job seekers won’t accept less than $81,147—up by almost $20,000 since March 2020. This figure is the average reservation wage of workers, which is the lowest wage at which respondents would be willing to accept a new job.
The Fed’s report highlights that workers are also increasingly dissatisfied with their current wages, benefits, and promotion opportunities.
Women, people without a college degree and those with annual household incomes lower than $60,000 feel the least likely to land a promotion any time soon.
Joblessness fears won’t stop workers eyeing up the exit
Despite the bleak job market, more people are looking for a new job now than during The Great Resignation.
Nearly 30% of those surveyed by the Fed said that they had been job hunting last month—up from 19% percent in July 2023.
It marks the highest level recorded since March 2014, when 32% of professionals said they were looking for another job.
In comparison, in the Spring of 2021, when a record four million American workers quit their jobs, just over 20% of people the Fed surveyed were searching for new pastures.
What’s more, the rate of those transitioning to a new employer has hit the highest level ever at 7.1%. Again, during The Great Resignation fewer than 5% of people reported that they were enrolling with a new company.
