Peter Smith
⬤ Hiring expectations across the Chicago Federal Reserve's Seventh District have fallen off a cliff, hitting their lowest point since the 2020 economic shutdown. The index dropped to -40 points in October—a level not seen in years. The Chicago Fed Survey of Economic Conditions shows this steep decline as one of the most severe since tracking began in 2013, covering employers across Illinois, Iowa, Indiana, Michigan, and Wisconsin.
⬤ The speed of the collapse is especially alarming. Hiring expectations plunged 41 points in just two months, reflecting a dramatic shift in business confidence. It's not just future hiring that looks grim—current hiring has stayed negative for three straight years and is now near its lowest level in five years. This isn't just a cyclical dip; it suggests deeper structural weakness in labor demand.
⬤ With hiring momentum evaporating this fast, the Chicago-area labor market is heading into uncertain territory. The decline signals serious caution among businesses facing weak demand, inflation pressures, and limited visibility. If things don't turn around soon, expect pressure to build on policymakers and the Federal Reserve to step in with measures aimed at stabilizing employment and restoring some confidence before conditions spiral further.
Peter Smith
