Why is the US hiring rate so low?

The US hiring rate is low due to factors like economic uncertainty, high interest rates, the tech sector's adjustments, reduced worker confidence in finding new jobs, and a smaller pool of new workforce entrants from immigration and an aging population.

What is the current hiring rate in the US?

The hiring rate in December was 3.3%, which is a historically low figure not seen since before the COVID-19 pandemic.

How are immigration restrictions affecting US hiring?

Immigration restrictions have reduced the flow of new workers into the US, and combined with an aging population, have significantly decreased the number of potential new employees available for hire.

Home / Business and Economy / Deep Freeze Grips US Labor Market

Deep Freeze Grips US Labor Market

8 Feb

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Summary

Hiring rate hit 3.3% in December, a low not seen since before Covid.
Worker confidence in finding new jobs is at a record low.
Immigration restrictions and aging population reduce workforce entrants.

The American labor market is currently experiencing a significant slowdown, with the hiring rate falling to 3.3% in December. This rate, which measures hires as a share of overall employment, is notably low compared to pre-pandemic levels and the period immediately following it.

Multiple factors contribute to this "deep freeze." Companies face uncertainty over tariff policies and higher short-term interest rates, impacting their ability to plan and hire. The tech sector is also dealing with an overhang of workers after aggressive hiring post-pandemic. Furthermore, the number of workers quitting their jobs has decreased significantly, suggesting a more cautious labor market.

Worker confidence in finding new employment is at a record low, with surveys indicating a decline in job-seeking prospects. This reluctance to leave current positions contributes to the reduced pace of hiring, as fewer roles need to be backfilled.