Sun Jan 11 18:10:00 UTC 2026: ### Hiring Recession Grips the U.S. Labor Market in 2025, Economists Warn

The Story:
The U.S. labor market experienced a significant slowdown in 2025, marked by sluggish hiring and weak job creation, leading economists to characterize it as a “hiring recession.” According to the Bureau of Labor Statistics, the U.S. added only 584,000 jobs throughout the year, the worst performance outside of a recession since 2003. Job growth was heavily concentrated in the healthcare sector, and long-term unemployment reached its highest level since February 2022, signaling potential instability for the coming year.

Key Points:

  • Hiring Recession: Economists describe the labor market in 2025 as a “hiring recession.”
  • Anemic Job Creation: Only 584,000 jobs were added in 2025, the worst since 2003, excluding recession years.
  • Healthcare Dominance: Approximately 69% of all job growth in 2025 occurred in the health-care sector.
  • Rising Long-Term Unemployment: 26% of unemployed workers in December had been out of work for at least six months, the highest since February 2022.
  • Falling Hiring Rate: The hiring rate fell to 3.2% in November, one of the lowest rates since 2013.
  • Skills-Based Hiring: Employers increasingly prioritize skills and experience over educational attainment.
  • AI and Job Applications: Experts recommend using AI to match keywords in resumes with job descriptions.
  • Target Growth Areas: Job seekers should focus on growing sectors such as healthcare, skilled trades, and infrastructure.

Key Takeaways:

  • The labor market has shifted dramatically from the strong worker leverage seen in 2021 and 2022, making job searching more challenging.
  • The concentration of job growth in a single sector (healthcare) highlights the vulnerability of the overall labor market.
  • Job seekers need to adapt to skills-based hiring practices and leverage technology to improve their chances of success.
  • Networking and focusing on growing industries are crucial strategies for finding employment in the current market.
  • Economists are cautiously optimistic that tax cuts and lower interest rates could improve the job market in the second half of 2026.

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