Laid off by the music streaming service Spotify last year, Joovay Arias figured he\u2019d land another job as a software engineer fairly soon. His previous job search, in 2019, had been a breeze.<\/p>\n
\u201cBack then,” he said, \u201cI had tons of recruiters reaching out to me \u2014 to the point where I had to turn them down.\u201d<\/p>\n
Arias did find another job recently, but only after an unexpected ordeal.<\/p>\n
\u201cI thought it was going to be something like three months,\u2019\u2019 said Arias, 39. \u201cIt turned into a year and three months.\u2019\u2019<\/p>\n
As Arias and other jobseekers can attest, the American labour market, red-hot for the past few years, has cooled. The job market is now in an unusual place: Jobholders are mostly secure, with layoffs low, historically speaking. Yet the pace of hiring has slowed, and landing a job has become harder. On Friday, the government will report on whether hiring slowed sharply again in August after a much-weaker-than-expected July job gain.<\/p>\n
\u201cIf you have a job and you\u2019re happy with that job and you want to hold onto that job, things are pretty good right now,\u201d said Nick Bunker, economic research director for North America at the Indeed Hiring Lab. \u201cBut if you’re out of work or you have a job and you want to switch to a new one, things aren\u2019t as rosy as they were a couple of years ago.\u2019\u2019<\/p>\n
Since peaking in March 2022 as the economy accelerated out of the pandemic recession, the number of listed job openings has dropped by more than a third, according to the government’s latest monthly report on openings and hiring.<\/p>\n
Temporary-help firms have reduced jobs for 26 of the past 28 months. That\u2019s a telling sign: Economists generally regard temp jobs as a harbinger for where the job market is headed because many employers hire temps before committing to full-time hires.<\/p>\n
In a roundup this week of local economic conditions, the Federal Reserve\u2019s regional banks reported signs of a decelerating job market. Staffing agencies have said that job gains have slowed \u201cas firms are approaching hiring decisions with greater hesitancy,\u201d the New York Fed found. \u201cJob candidates are lingering on the market longer.\u201d<\/p>\n
The Minneapolis Fed said that a staffing agency reported that \u201cbusinesses are getting a lot more picky\u201d about whom they hire. And the Atlanta Fed found that \u201conly a few\u201d companies planned to step up hiring.<\/p>\n
Job-hopping, so rampant two years ago, has slowed as workers have gradually lost confidence in their ability to find better pay or working conditions somewhere else. Just 3.3 million Americans quit their jobs in July, compared with a peak of 4.5 million in April 2022.<\/p>\n
\u201cPeople are staying put because they\u2019re afraid they won\u2019t find new jobs,\u2019\u2019 said Aaron Terrazas, chief economist at the employment website Glassdoor.<\/p>\n
And the U.S. Labor Department has reported, in its annual revised estimates of employment growth, that the economy added 818,000 fewer jobs in the 12 months that ended in March than it had previously estimated.<\/p>\n
In one respect, it’s not at all surprising that the pace of hiring is now moderating. Job growth in 2021 and 2022, as the economy roared back from the COVID-19 recession, was the most explosive on record. Workers gained leverage they hadn\u2019t enjoyed in decades. Companies scrambled to hire fast enough to keep up with surging sales. Many employers had to jack up pay and offer bonuses to keep employees.<\/p>\n
It was inevitable \u2014 and even healthy, economists say, in the long run \u2014 for hiring to slow, thereby easing pressure on wage growth and inflation pressures. Otherwise, the economy could have overheated and forced the Fed to tighten credit so aggressively as to cause a recession.<\/p>\n
The post-pandemic jobs boom was a marked contrast to the sluggish recovery from the Great Recession of 2007-2009. Back then, it took more than six years for the economy to recover the jobs that had been lost. By contrast, the breathtaking pandemic job losses of 2020 \u2014 22 million \u2014 were reversed in less than 2 1\/2 years.<\/p>\n
Still, the surging economy ignited inflation, leading the Fed to raise interest rates 11 times in 2022 and 2023 to try to cool the job market and slow inflation. And for a while, the economy and the job market appeared immune from higher borrowing costs. Consumers kept spending, businesses kept expanding and the economy kept growing.<\/p>\n
But eventually the continued high rates began leaving their mark. Several high-profile companies, including tech giants like Spotify, announced layoffs last year in the face high interest rates. Outside of the economy’s technology sector, though, and, to a lesser extent, finance, most American companies haven’t cut jobs. The number of people filing first-time applications for unemployment benefits is barely above where it was before the pandemic struck.<\/p>\n
Yet the same companies that are keeping workers aren’t necessarily adding more.<\/p>\n
\u201cCompared to a year or two ago, it\u2019s a lot more difficult, particularly for entry-level folks,\u2019\u2019 Glassdoor’s Terrazas said. \u201cBecause of the gradual drip of layoffs in tech and finance, in professional services over the past year and a half, there have been a lot of high-skilled, experienced folks on the job market.<\/p>\n
“By all evidence, they are finding jobs. But they are also pushing more entry-level folks further and further down the queue\u2026 Recent grads, folks without a lot of on-the-job experience are feeling the effects of suddenly competing with people who have two, five, 10 years\u2019 experience in the jobs market. When those big fish are in the market, the little fish naturally get squeezed out.\u2019\u2019<\/p>\n
Despite the pressure of the highest interest rates in decades, the economy remains in solid shape, having grown at a healthy 3% annual pace from April through June. Most Americans are enjoying solid job security.<\/p>\n
Still, given the growing difficulty of changing jobs, even some of those job holders are feeling the chill.<\/p>\n
\u201cThe reality is a lot of people, even when they have jobs, are feeling a lot of angst about the economy,\u2019\u2019 Terrazas said. \u201cPeople are feeling a little bit job insecurity, a lot more pressure in the workplace than they have in a while.\u2019\u2019<\/p>\n
In an August survey, the New York Fed found that Americans as a whole are more worried about losing their jobs now than at any time since 2014, when people were just beginning to feel the full effects of the recovery from the Great Recession of 2008-2009.<\/p>\n
Adding to the anxiety is that memories of the recent job boom are still fresh.<\/p>\n
\u201cThe reference point for most people is still 2021, 2022, when the job market was very strong, and what looks like for us economists as a normalization (of the job market from unsustainable levels), I think for a lot of people feels like a loss of status,\u2019\u2019 Terrazas said.<\/p>\n
Consider Abby Neff, who, since graduating from Ohio University in May 2023, has struggled to find the \u201cold-fashioned writing job\u2019\u2019 that she hoped to land in journalism<\/p>\n
\u201cIt\u2019s been pretty tough,” she said, \u201cto find a permanent journalism job.\u201d<\/p>\n
In the meantime, Neff, 23, has joined the government\u2019s AmeriCorps agency, which mobilizes Americans to perform community service, in southeastern Ohio. The job doesn\u2019t pay much. But it has given her the opportunity to write and to learn about everything from forestry to sustainable agriculture to watershed management.<\/p>\n
She hadn’t expected to encounter such difficulty in finding a job in her field.<\/p>\n
\u201cI feel like I did all the \u2018right things\u2019 in college,\u2019\u2019 Neff said ruefully.<\/p>\n
She edited a campus magazine and made contacts in the business. She has landed some interviews, only to learn later that the job was filled without her having heard from the employer.<\/p>\n
\u201cI will get \u2018ghosted,\u2019 \u2018\u2019 she said. \u201cI almost feel like I have to hunt employers down to even get a response to an application or submission.”<\/p>\n
Arias, the software engineer, started looking for a job \u201cthe minute I got laid off\u2019\u2019 in June 2023. At first, he was casual about it. He took time off to care for his newborn daughter and drew money out of his severance package from Spotify. But when the job hunt proved difficult, he \u201cdecided to really ramp it up\u2019\u2019 early this year.<\/p>\n
Arias started driving for a ride-sharing service and getting job leads from passengers. He reached out to a company through which he had taken part in a computer coding bootcamp, seeking contacts. Eventually, the networking paid off with a new job.<\/p>\n
Yet the process proved much more frustrating than he had envisioned. Employers he had communicated with would vanish without explanation.<\/p>\n
\u201cThat\u2019s the worst part about the experience,\u2019\u2019 Arias said. \u201cYou get that introductory message. Then you send your resume. And then that\u2019s it. Communication would end there. Or you\u2019d get an automated response. So you don\u2019t know what happened, what you did wrong \u2026 It just feels really demoralizing, really stressful, because you don\u2019t know what happened.”<\/p>\n
___<\/p>\n
AP Economics Writer Christopher Rugaber contributed to this report.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Adding to the anxiety is that memories of the recent job boom are still fresh<\/p>\n","protected":false},"author":186339,"featured_media":474367,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2313,2312],"tags":[57655,2395,3859,56707,2657],"yst_prominent_words":[2237,36265,20816,17653,15961,13292,12739,5382,5088,2165],"acf":[],"_links":{"self":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/492161"}],"collection":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/users\/186339"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/comments?post=492161"}],"version-history":[{"count":3,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/492161\/revisions"}],"predecessor-version":[{"id":492164,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/492161\/revisions\/492164"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/media\/474367"}],"wp:attachment":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/media?parent=492161"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/categories?post=492161"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/tags?post=492161"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/yst_prominent_words?post=492161"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}