{"id":458165,"date":"2025-12-19T17:14:19","date_gmt":"2025-12-19T17:14:19","guid":{"rendered":"https:\/\/www.europesays.com\/us\/458165\/"},"modified":"2025-12-19T17:14:19","modified_gmt":"2025-12-19T17:14:19","slug":"americans-have-a-new-thing-to-worry-about-a-stuck-job-market-with-no-quick-fix","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/458165\/","title":{"rendered":"Americans have a new thing to worry about: A stuck job market with no quick fix"},"content":{"rendered":"

The latest jobs report had its share of shutdown-related quirks<\/a>, but a familiar theme cut through the noise: The US labor market is stuck in a rut.<\/p>\n

Employers are still hiring, but job growth is at one of its weakest paces in the past two decades.<\/p>\n

The \u201clow-hire, low-fire\u201d dynamics persisted<\/a> in November, with an unemployment rate driven higher<\/a> partly by more people looking for work but not finding it. Long-term unemployment increased, discouraged workers were on the rise, and economic disparities deepened.<\/p>\n

\u201cHiring, while certainly not on a freeze, is on hold; and people that have jobs are absolutely holding on to them with white knuckles,\u201d Dan North, Allianz Trade\u2019s senior economist for North America, told CNN this week. \u201cI see that as definitely a labor market that\u2019s stagnating.\u201d<\/p>\n

So where does it go from here? Some economists say this low-gear state can continue for quite some time. But others note that it\u2019s only a matter of time before the labor market sees a major shift \u2014 and there are several ways that could happen.<\/p>\n

Inertia<\/p>\n

Although the labor market has cooled, the overall economy is still growing at a decent clip and productivity hasn\u2019t slipped<\/a>.<\/p>\n

The US economy\u2019s job gains have averaged 55,000 a month, which may be reflective of the \u201cpervasive uncertainty\u201d caused by stark changes in US trade and immigration policy. But the American population is also going through its own transformation, said Joe Brusuelas, RSM US chief economist.<\/p>\n

The supply of labor is shrinking as the Baby Boomer generation<\/a> ages out of the workforce and additional constraints<\/a> are placed on immigration, he noted.<\/p>\n

And there\u2019s been a shift in the \u201cbreakeven rate\u201d of employment. Put simply, the economy doesn\u2019t need to create as many jobs as it once did in order to sustain itself.<\/p>\n

\u201cMy estimate is that we need to hire 50,000 a month to keep the labor market conditions stable,\u201d Brusuelas told CNN. The economy will \u201cgrow at around 2%, financial conditions will be OK, and we\u2019ll probably ease off a little bit on the inflation side.\u201d<\/p>\n

From an economics or capital markets perspective, that\u2019s a perfectly reasonable outcome and one that \u201ccould go on for years,\u201d he said.<\/p>\n

However, \u201cthe K-shaped economy<\/a> means that the disproportion of the benefits accrued from prosperity will not be distributed equally,\u201d he added, meaning wealthier households will do better than poorer households as hiring slows.<\/p>\n

Further deterioration<\/p>\n

A big wild card right now is AI and how much it could reshape employment<\/a>. In the near term, questions about the technology will continue to make businesses cautious about hiring, Pantheon Macroeconomics economists wrote in a note this week.<\/p>\n

\u201cThe longer-term implications for labor displacement and wage dynamics, however, remain an open question,\u201d Seema Shah, chief global strategist at Principal Asset Management, wrote in a note Tuesday.<\/p>\n

AI \u2014 alongside immigration enforcement and broader policy uncertainty \u2014 remains a headwind to labor market growth, said Tyler Schipper, associate professor of economics at St. Thomas University in St. Paul, Minnesota.<\/p>\n

\u201cThe question I ask myself is, \u2018 What would be the conditions in which I think the labor market would ramp back up?\u2019 and some of those are policy-related,\u201d he said. \u201cI have a hard time seeing those resolving themselves anytime soon.\u201d<\/p>\n

\u201cFor better or worse, I think we could be in this K-shaped economy for some time,\u201d he added. \u201cAnd I think the way out of it probably is that there\u2019s a recession before things get better, which is never what you want to hear if you\u2019re on the lower leg of the K.\u201d<\/p>\n

Reacceleration<\/p>\n

The labor market could see hiring reaccelerate, said Cory Stahle, economist at Indeed Hiring Lab.<\/p>\n

It just may take a bit to take hold.<\/p>\n

\u201cThe US labor market is like a pretty big ship turned by a rudder,\u201d he said. \u201cSometimes it takes a little time to turn around.\u201d<\/p>\n

One force could be the recent interest rate cuts<\/a> from the Federal Reserve, he said, noting that it typically takes about three to five quarters for monetary policy changes to work their way through the economy.<\/p>\n

Another could be policy changes or anything else that eases Americans\u2019 uncertainty<\/a>, which has drastically stifled hiring this year. Also at play are the impacts of the tax law set to take effect in 2026<\/a>, RSM\u2019s Brusuelas said.<\/p>\n

\u201cThere\u2019s uncertainty around what rates are going to do, uncertainty around prices, uncertainty around general policy,\u201d Stahle said. \u201cUnless that fog of uncertainty is broken, we\u2019ll continue to see companies stumbling a little bit through that fog.\u201d<\/p>\n

For more CNN news and newsletters create an account at CNN.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"The latest jobs report had its share of shutdown-related quirks, but a familiar theme cut through the noise:…\n","protected":false},"author":3,"featured_media":458166,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[64,5190,79,119375,4506,70146,2179,67,132,68],"class_list":{"0":"post-458165","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-chief-economist","10":"tag-economy","11":"tag-joe-brusuelas","12":"tag-labor-market","13":"tag-policy-uncertainty","14":"tag-unemployment-rate","15":"tag-united-states","16":"tag-unitedstates","17":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115747362292474172","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/458165","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=458165"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/458165\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/458166"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=458165"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=458165"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=458165"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}