Consumers Hold the Line as Their Financial Cushion Shrinks

Consumer confidence fell across demographics

The PCEI overall slipped 0.7 points in September to 54.1, marking a second consecutive monthly decline in consumer confidence. Still, that figure is comfortably above the neutral midpoint of 50, where scores above 50 signal a more optimistic consumer and scores below it signal a gloomier one.

Nearly all the decline comes from the Macroeconomic and Buying Climate subindex, which measures how consumers feel about the economy overall and the timing of big purchases. This score fell 2.2 points to 45. Meanwhile, the subindex tracking Personal Financial Resilience, such as savings and debt, held essentially flat at 58.3. The Labor Market Security subindex dropped just 0.9 points to 65.7.

Prices sit at the center of the story. Energy costs rose between July and September 2026, and 85% of consumers said their essential expenses had increased over the past year. When people see higher numbers at the cash register, they tend to rate the broader economy worse, even when their own paycheck and savings account look the same as last month.

The decline in consumer confidence was felt across the board. The Macroeconomic and Buying Climate subindex fell by more than one point for every demographic PYMNTS Intelligence tracks, showing a rare unanimity. Whether someone lives paycheck to paycheck or has money to spare, whether they’re just out of college or well into their retirement, they all felt worse about the direction of the economy.

A few specific measures showed especially steep declines this month. Short-Term Business Conditions fell 2.6 points, the largest move of the eleven dimensions tracked in the PCEI. Long-Term Business Conditions dropped 2.0 points. The Buying Conditions measure, which gauges whether now feels like a good time for a big purchase, fell 1.8 points. In the Labor Market Security subindex, meanwhile, job mobility fell 2.2 points.

Three measures tied to household capacity, debt manageability, savings capacity and emergency readiness posted small gains, but those gains only brought each measure back to its six-month average after a softer August.

Gen Z and Generation X showed the steepest decline in overall sentiment. Short-term business conditions fell the most among consumers living paycheck to paycheck with difficulty, down 3.4 points. Among generations, only Generation Z showed increases in long-term business conditions scores, rising 0.7 points. This was the only improvement in outlook among the tracked generations.

Consumer confidence falls even as job security stays strong

Personal job security, which asks consumers how safe they feel in their current role, barely moved in September, remaining high at 80.4. Perceived safety from layoffs improved, rising 1.3 points back to its recent average of 71.9.

Meanwhile, job mobility, which asks whether consumers believe they could find a new job paying what they need, fell 2.2 points to 46.9, remaining below the neutral 50 mark. Every household income tier PYMNTS tracks falls below that line, and every tier decreased by roughly two points this month, from a decline of 1.8 points among households earning $100,000 to $150,000 to 2.6 points among households earning $150,000 or more.

Federal data similarly show consumers struggling to make changes. The share of workers voluntarily quitting their jobs hit a post-pandemic low of 1.9% in July, according to the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey. Hiring, at 3.2%, showed the weakest reading since February. The average wage a job seeker says they would need to accept a new offer, known as the reservation wage, rose to a record $88,387 in July, up more than $10,000 since March 2025, according to the Federal Reserve Bank of New York. Job seekers’ asking price keeps rising while the pace of hiring keeps slowing.

The most financially secure individuals led the decline in job mobility. Those not living paycheck to paycheck posted a 3.2-point decline. By generation, millennials fell 3.4 points to 48.9, and Generation X fell 3.9 points to 43.1, the two steepest declines in the survey. Generation Z moved in the opposite direction, rising 1.1 points to 49.8, as did baby boomers and seniors, up 0.5 points to 44.5.

Household savings buffers grew thinner even as day-to-day finances held steady

Personal Financial Resilience, which encompasses savings, debt and day-to-day money management, didn’t move much in September. However, savings are eroding.

Consumers reported how long their savings would cover their current lifestyle if their income stopped. The share who said it would only last them three months or less rose to 51.8% in September. That figure’s up 2.4 percentage points from August and 4.0 percentage points since April. The share who said their savings would last more than a year fell to 15.1%, a twelve-month low, down 3.7 percentage points over that same six-month span. The share of consumers reporting more than a year of savings fell to a twelve-month low, while the share within three months rose for a third consecutive month.

The Savings Capacity measure asks consumers how confident they feel in their ability to save money over the coming year. Here, there’s some generational variation. Baby boomers and seniors grew more confident, up 3.6 points, while Generation Z became less confident, down 1.3 points. Confidence in the ability to save and estimations about how long those savings would last are related but different. Rising living costs diminish the latter even as the former holds basically steady.

Consider a car’s fuel gauge. If the tank holds a set number of gallons, but the car starts burning fuel faster because of a longer commute, the needle will drop faster, even though capacity hasn’t changed. That’s effectively what’s happening to household savings. Confidence is holding steady, but rising costs mean savings buy less time than they used to.

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Methodology

The PYMNTS Consumer Expectations Index (PCEI) is a monthly, survey-based measure of U.S. consumer sentiment. It runs on a 0-100 scale, where a score of 50 is neutral and higher scores mean more positive sentiment. The index draws on eleven core dimensions, each standardized to that same 0-100 scale. PYMNTS Intelligence organizes those eleven dimensions into three subindices: Personal Financial Resilience, Macroeconomic and Buying Climate, and Labor Market Security. The September 2026 survey included 2,098 U.S. consumers and was fielded Sept. 1–3, 2026.

^{1. For a breakdown of how this index works, see Introducing the PYMNTS Consumer Expectations Index.}↩