Tariffs and the uncertainty surrounding them have tanked consumers’ feelings about the economy’s future.

In preliminary April readings, the Michigan Consumer Sentiment Index fell to its lowest point since June 2022, when the public grappled with the impact of surging inflation following pandemic lockdowns. That’s also lower than at any point during the 2008 financial crisis, when a meltdown in mortgage markets led to bank failures and a crisis in the global financial system.

Concerns over prices and tariffs have helped push consumer sentiment to levels lower than during the 2008 financial crisis.

Survey responses show that President Donald Trump’s tariff policies have caused economic jitters. Trump says the tariffs are needed to rebalance trade, bring back manufacturing jobs and raise more money for the federal government. Economists warn that tariffs could increase prices for inflation-weary shoppers.

Weaker consumer confidence in the economy’s future is a concern for forecasters because it can be a precursor to slower spending. Consumer spending accounts for a large chunk of gross domestic product (GDP), a measure of the economy’s growth, and shopping has helped to buoy the economy through spiking inflation in the wake of COVID-19’s economic aftermath.

“The bottom line is that consumer sentiment is very weak, and the fear is that this will spill over to weaker actual spending,” wrote Torsten Sløk, Apollo chief economist, in a blog post.

Consumers Expecting Higher Prices, Worsening Business Conditions

Diving deeper into recent results from the University of Michigan survey revealed other indications that consumers are experiencing a crisis of confidence tied to tariffs.

A historically high portion of consumers expect to lose purchasing power in the upcoming year. More than three out of every five survey respondents expect prices to rise faster than wages.

A majority of consumers now expect prices to rise faster than wages, with fewer seeing their paychecks being able to keep up with inflation.

In another snapshot of fading sentiment, 51% of respondents to the Michigan survey said they expect business conditions to worsen over the next year, the most negative response the survey has had at any point in its history.

The number of consumers who expected business conditions to worsen over the next year have reached their highest ever levels.

More information on consumer sentiment will be available Friday when the final numbers for April are released.