Americans Are Too Scared to Quit Their Jobs, New Fed Survey Finds
The latest data out of the Federal Reserve Bank of New York paints a picture of a labor market that isn't collapsing - but isn't healthy either.
Key Takeaways
- Americans are quitting jobs at a record-low rate of 15.9%, signaling growing worker anxiety
- Inflation expectations held at 3.0% — still above the Fed’s 2% target
- The U.S. shed 92,000 jobs unexpectedly in February 2026
- Stagflation risk is rising as oil prices surge and hiring stalls
The February 2026 Survey of Consumer Expectations (SCE) recorded the lowest voluntary job separation rate in the survey’s history: just 15.9%. In plain terms, workers aren’t quitting. Not because they’ve found their dream jobs, but because they’re afraid of what’s out there.
This is the defining feature of what Fed officials have taken to calling a “low-hire, low-fire” environment. Layoffs aren’t spiking. But neither is hiring. The economy is, in a sense, frozen — and the people in it know it.
That anxiety has a numbers behind it. Median expected earnings growth dropped to 2.5%. Confidence in finding a new job, should someone lose theirs, has weakened — with some metrics hitting historic lows earlier this year. Meanwhile, the U.S. unexpectedly shed 92,000 jobs in February alone, a figure that doesn’t square with any narrative of economic resilience.
On inflation, the news is mixed at best. One-year expectations ticked down slightly to 3.0% from 3.1% in January. The three- and five-year horizons held steady at the same level.
That kind of anchoring gives the Federal Reserve something to point to — but 3.0% is still a full percentage point above its official 2% target, and it’s not moving in any meaningful direction.
The bigger inflation threat may not yet be showing up in consumer surveys. Analysts are already flagging a surge in oil prices — now trading above $100 to $120 per barrel amid renewed Middle East tensions — as a variable that could sharply push expectations higher in the months ahead. February’s relatively stable readings may end up being the calm before a more turbulent spring.
On the household finance side, there were modest positives. Expected income growth held at 2.9%, spending expectations sat at 4.9%, and the probability of missing a minimum debt payment fell to 11.6% — its lowest reading since February 2024. Taken alone, those numbers suggest consumers are managing. Set against the broader backdrop, they suggest people are managing carefully, because they have to.
The macro forecasts for the rest of 2026 offer little comfort. J.P. Morgan Global Research projects U.S. core inflation at 3.2% for the full year. The Congressional Budget Office sees unemployment climbing to 4.6% before any gradual recovery takes hold. And markets are increasingly focused on the possibility of a stagflationary bind — a scenario where the Fed cannot cut rates to stimulate growth because inflation remains too stubborn, even as the economy softens underneath it.
That’s the real risk embedded in this data. Not a crash, but a slow grind — workers locked in place, hiring going nowhere, inflation refusing to fully cooperate, and policymakers with limited room to maneuver.
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