American workers are quitting their jobs at the highest rate since February 2023, according to the Federal Reserve Bank of New York's May Survey of Consumer Expectations. But at the same time, fears of being laid off are rising and confidence in finding a new job is plummeting. The survey, which tracks consumer sentiment, reveals a labor market in which optimism about individual prospects coexists with deepening anxiety about the broader economy.

The 20.8% quit rate — a record that masks a deeper worry

The mean probability of voluntarily quitting within 12 months jumped 2.6 percentage points to 20.8% in May, the highest since February 2023, the New York Fed reported. That increase was broad-based across age, education, and income levels. Traditionally, a rising quit rate signals worker confidence that better opportunities exist, but this time the accompanying metrics tell a different story.

Layoff fears at 15.1% while job-search confidence sinks to 43.7%

The same survey found the perceived probability of being laid off in the next year rose 0.5 points to 15.1%.. More strikingly, the perceived ability to find a new job within three months after a layoff fell 2.3 points to 43.7% — the lowest level since December. this combination of higher layoff expectations and lower re-employment confidence suggests workers see the labor market as tightening, even as actual jobless claims remain near historic lows and the unemployment rate holds around 4.3%, according to the report.

Tech and finance workers feel the brunt of an AI narrative

The source report notes that technology and finance sectors have experienced relatively high levels of job losses recently.. Workers in these industries may feel heightened economic anxiety, amplified by narratives about AI-driven job displacement.. This sector-specific distress could be pulling down the aggregate confidence numbers, even as other industries remain tight.

The unanswered question: is quitting a preemptive escape or a gamble?

The New York Fed's survey does not track whether workers who plan to quit actually land better jobs. One plausible explanation, according to the report, is that employees plan to quit preemptively — seeking more secure employment before any potential layoff occurs. But it remains unclear whether these intentions will translate into actual moves, especially if the broader economy slows.. The survey also leaves open the question of how the Federal Reserve's expected no-rate-cut policy through 2024 will affect hiring plans.