Photo by Ron Lach on Pexels
With so much innovation and growth within the US economy, why is the job market so slow?
For the latter half of 2025, the job market slowed down, with the unemployment rate rising to some of the highest levels since 2021, a period marked by a literal pandemic, during which only an average of 44k jobs were added per month, lower than any year during the 2010s.
This has been incredibly challenging for young people and new college graduates, who, despite impressive degrees and certifications, can’t find any work. Even though economic growth is shooting up, employment rates have gone down. But why?
The answer lies a few years back, when, during late 2021 and early 2022, the “Great Resignation” occurred. Here, tens of millions of workers quit their jobs to work in higher-paying ones at different companies, causing a “low hire, low fire” balance in 2023 and 2024. Throughout that period, unemployment crept up from 3.4% in late 2023 to 4.5% in November 2025, since the number of people who want jobs is increasing, only to find that no one is hiring.
It’s sad to know that with all this talk about an economic boom driven by AI and other progressing technologies, people can’t get jobs to support themselves, even though the possibilities seem endless. It’s demotivating for workers to see that the path they were told to follow, doing well in high school, getting into a good college, getting a degree, and finding stable work, is failing, and no one seems to be doing anything about it.
The jobs that are hiring don’t pay enough to live comfortably, pay off loans, and advance to a more stable position. Most companies are in a position where they have enough workers and don’t want to take on new ones, especially considering the addition of AI to the workplace, which is replacing entry-level roles. The thing is, people don’t know how AI will affect the market, creating market uncertainty.
To put it in perspective, 2.2 million jobs were added in 2024, but only 584,000 jobs in 2025. Why the sharp drop? This is due to uncertainty about long-term plans as a result of government events like laying off thousands of workers or the government shutdown through the fall of 2025, only made worse by constantly changing foreign policies regarding tariffs.
Businesses are stuck with uncertainty, the government seems to have its eyes abroad and not here in the USA, and no one is feeling any economic growth.
So what is to be done?
Well, it’s possible that not as many jobs need to be made anymore in the first place. The supply of labour is dropping as immigration is halted and birth rates drop, meaning that it’s possible, as time goes on, with fewer people in the US, there are simply going to be fewer jobs, and the effects of AI couldn’t change that.
On a more optimistic note, however, economists predict the job market could experience an acceleration, though it might be far in the future, like a ship turning around. The rudder takes a while, but once the ship straightens out, it takes off.
One thing that could speed up the rudder is the recent interest rate cut from the Federal Reserve, whose policies typically begin to show up in the economy nine to 15 months after they are implemented.
At the very least, the economy is somewhat stable, with expected growth of 1.8%, along with over $50 billion in tax returns, from “The US economy looks stable for 2026—and you’ll feel better about it, too,” by Megan Leonhardt, a senior economics writer. Unemployment will peak around the first quarter, and then decrease, but it’s unknown how much of a rebound could be made. What’s important, though, is that the job market is likely to strengthen as uncertainty eases, tariffs are passed onto customers, and profit margins grow, all of which can work to reduce unemployment.
Even though inflation is expected to increase, policy changes could change its effects on the economy, which, either way, would reduce uncertainty in businesses. Wages have also shot up, with many states hiking the minimum wage to over $15 compared to below $10.
Looking at it from this perspective highlights how the market is ever-changing and that there is always reason to look at the brighter side of things, even if they may take a while to come. It often feels like things get worse faster than they get better, and though that may be true, they do get better. In a time where many things are ever changing, it’s easy to feel lost, like past things don’t work anymore, or like there is no one trying to fix things. However, no one can predict the future, and there are two sides to the same coin that show why things are happening and how they can be fixed.
Be First to Comment