U.S. workers are facing rising economic insecurity marked by growing pessimism, financial strain and job anxiety, with California particularly hard hit by high living costs.

LOS ANGELES, Jan. 16 (Xinhua) -- U.S. workers face growing economic insecurity, while California sees sharp declines in financial confidence and job security. This message came from a public policy seminar here.

In a virtual event held Thursday by the Public Policy Institute of California (PPIC), CEOs and experts highlighted sharp rises in pessimism, job fears and financial stress among workers from 2024 to 2026.

Sarah Bohn, vice president and center director of the PPIC, said at the meeting that many people across the United States are grappling with challenges related to affordability and opportunity.

HISTORICALLY HIGH PESSIMISM

According to a Wall Street Journal and NORC Research Center poll conducted in mid-2025, the share of Americans who believe they have a good chance of improving their standard of living fell to 25 percent, a record low in surveys dating back to 1987.

The poll found that nearly 70 percent of Americans said the American Dream, the idea that hard work leads to prosperity, no longer holds true or never did. Meanwhile, 45 percent of Americans believe the economy will get worse over the next year.

The pessimism cut across party lines, with 55 percent of Republicans and 90 percent of Democrats reporting bleak views of their own economic futures and those of their children.

California's situation appears particularly severe, the PPIC said. It found that 71 percent of Californians do not believe in the American Dream, while 56 percent said economic security is harder to achieve in their state than in other parts of the United States.

As of November 2025, three in four Californians expected tough financial times in the next 12 months, it added.

MOUNTING FINANCIAL FRAGILITY

The escalating cost of living has forced families across America to make difficult choices, according to a national survey by AMFM Healthcare.

While 87 percent of Americans reported financial anxiety in 2025, 79 percent said this anxiety had increased since the start of the year, said the survey.

California faces significant food insecurity challenges, the PPIC said. The research found that 30 percent of Californians had reduced meals or cut back on food to save money, including about half of lower-income residents earning less than 40,000 U.S. dollars a year.

Emergency financial vulnerability affects workers nationwide. A PPIC survey found that 19 percent of California adults said it would be "nearly impossible" or "very difficult" to cover a 1,000 dollars emergency expense. Among lower-income households in the state, that figure rose to 46 percent.

One in five Californians worries about paying bills every day or almost every day, including 37 percent of lower-income residents, it added.

Financial stress is also showing up in rising debt delinquencies. Student loan delinquency rates jumped after federal loan collections resumed in May 2025, with California's rate reaching 11 percent in the second quarter, according to data from the California Credit Dashboard.

AI ANXIETY RISES

A rapidly growing source of workplace anxiety affects workers across all states, including California, where many AI companies are headquartered.

According to Monster's 2026 WorkWatch Report, 49 percent of American workers are now concerned that artificial intelligence could threaten their job or industry, while 40 percent expect moderate job reductions in their industry by the end of 2026.

Sean Cremin, a research associate at the PPIC, said during Thursday's event that "about half of California's workers fear that AI might take jobs in their industry."

According to the American Psychological Association's 2025 Work in America survey, 43 percent of middle managers and 40 percent of frontline workers feared that AI might cause some or all of their work duties to become obsolete.

It also found that 54 percent of U.S. workers report that job insecurity had significantly impacted their stress levels, with 39 percent concerned about losing their jobs within 12 months due to economic uncertainty or policy changes.

STATE RESPONSES LIMITED

Tess Thorman, a senior research associate at the PPIC, told Xinhua that California faces "structural constraints" in redesigning benefit programs to prevent workers from losing assistance as their earnings rise.

"One of the big challenges is that most safety net programs are federal, meaning the design is determined there," Thorman said. "California can supplement these programs to include additional populations, but we often cannot change the whole design."

The PPIC's recent research found that California workers feel particularly "stuck in survival mode," unable to plan for the future while managing immediate financial crises. However, this sentiment appears to reflect a broader national pattern.

A Bankrate survey last month found that 32 percent of Americans believe their financial situations will worsen in 2026, underscoring the urgency of the affordability challenges.