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The US job market is experiencing a “Great Freeze” due to a number of factors.
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Companies don’t want to let talent go, but they don’t add staff either.
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Low layoffs during a period of low hiring may hinder professional advancement.
Pack up and go down. The low-fire, low-hiring job market can be summed up in one sentence: “The Great Freeze.”
There are many “low” cases on the market soft job marketIncluding layoffs and unemployment. That’s good news, and that’s been the story for over a year. But the not-so-good news is that job postings and hiring are also down.
Lack of hiring and lack of firing may have the same reasons. Economists tell Business Insider the US is doing no such thing large-scale layoffs Because while the economy remains strong, uncertainty about tariffs and other issues means companies are reluctant to hire more people while holding on to the talent they have.
Are you job hunting, are you staying at your job, or are you a hiring manager who has seen workplace change? To share, reach this reporter at mhoff@businessinsider.com.
A low-fire, low-hiring labor market has pros and cons, including disabling effects. potential career advancement It offers cost-saving measures for workers but not for companies.
In a new report on the recent turnover and hiring outlook, ZipRecruiter called the recent labor market the “Great Freeze.”
“We are meeting with employers and job seekers “They’re both trying to wait out any uncertainty,” ZipRecruiter labor economist Nicole Bachaud told Business Insider.
The deadlock between low layoffs and low hiring may not end anytime soon.
“We’re only a few months away from the end of the year, and there’s no immediately clear catalyst for why the job market will recover from its current doldrums,” said Daniel Zhao, chief economist at Glassdoor.
Growth and consumer spending remain relatively solid, making it difficult to justify large-scale layoffs, said Jason Draho, head of asset allocation for the Americas at UBS Global Wealth Management.
“Earnings are still positive, businesses are still making money, and there’s really no catalyst for them to reassess their headcount,” said Stephen Juneau, senior U.S. economist at Bank of America.
Juneau of uncertainty, artificial intelligenceEconomic weaknesses and supply issues, such as construction activity, are impacting companies investing in new talent.
There are likely fewer workers entering the U.S. these days, slowing workforce growth. “This negative labor supply shock is clearly contributing to the hiring slowdown,” Juneau said.
Draho said that along with low hiring, supply problems also affected unemployment, which increased but remained relatively low.
Employers are hoarding labor or holding on to talent as a precaution because they don’t want to repeat previous staffing difficulties, Zhao said. “Following the experience of the Great Recession and labor shortages, many businesses are hesitant to return to a world where they are desperately looking for workers and cannot find them,” he said.
Draho said that if there is better growth next year, incentive measures will be taken and tariff clearanceThen companies won’t want to make mass layoffs every now and then and won’t have to scramble to find employees later. “They don’t want to be shortchanged because of a lack of labor,” he said.
ZipRecruiter’s September survey of talent acquisition experts found that 63% of businesses plan to hire moderately or significantly more next year; Last year this rate was 76%. “But current macroeconomic conditions continue to add delays and additional layers, which will generally keep hiring and movements at this slow pace for the next few months,” Bachaud said.
But if the economy worsens, labor hoarding could collapse. “If employers have some cash or some buffer to work with, they can afford to keep some workers on staff even if it is not profitable at the moment,” Zhao said. “I don’t expect this labor-hoarding story to protect against complete disaster.” business cycle and recession where businesses will have to lay off workers.”
Zhao said labor hoarding could be good for workers because of job security, and the unemployed would face less competition than mass layoffs. But many people are still actively looking for work in an environment of low hiring and low firing. Therefore, finding a job can be difficult. There were 7.4 million unemployed in August, but only 7.2 million job postings were available; Following the solid recovery in the labor market following the pandemic recession, the number of job openings per unemployed person has decreased significantly.
“Many workers are forced to settle for jobs that are not a good fit for them, whether they don’t pay appropriately for their experience or are not a field or industry where their skills would best match,” Zhao said. he said.
Lack of turnover can hinder professional development. Zhao said low hiring affects business owners who want to advance or advance or find a new job that offers better career development opportunities. bargain for a raise internally. The Atlanta Fed’s Wage Growth Tracker showed that the 12-month moving averages of average wage growth were similar for those who changed jobs and those who stayed in jobs as of August.
“Employers who focus too much on stability and keeping things as they are, maintaining the status quo, will run the risk of losing innovation and growth that will not happen if there is no movement within their company,” Bachaud said. “Employees will remain stuck in their roles without growing, adding new skills, and advancing their career paths.”
Bachaud in the cool job market where workers remain inactive improving people’s skills This way, they can grow and add to their resume when they look for a new position.
Are you looking for a job, keeping your job, or are you a hiring manager who has seen workplace change? Contact this reporter to share mhoff@businessinsider.com.
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