Is the Job Market Bad Right Now?

In the face of a slowdown in hiring, sweeping policy changes, economic uncertainty, and an increase in ghost jobs, securing employment seems more challenging than ever. However, there may still be a silver lining.

Why is the Job Market so Bad Right Now?
Challenges for Job Seekers
Are There Any Signs of Improvement?
Structural Changes in Hiring
Strategies for Job Seekers
Future Outlook

As 2025 unfolds, the job market remains in flux, with both the promise of improvement and the reality of a competitive, challenging hiring landscape. Although unemployment remains low, job seekers face significant obstacles, from prolonged employment searches and less hiring activity to an increase in ghost jobs.

These trends inevitably raise the question—is the job market bad right now?

Or perhaps we are seeing a structural shift in how hiring works in today’s economy.

The answer is nuanced, to say the least.

On one hand, research suggests that hiring could increase in the first half of 2025, as six in ten U.S. companies plan to add new positions.

On the other, .

This dichotomy highlights a key point we’ll explore in this Shortlister article: While opportunities may grow, challenges are equally intense, making it harder to secure a role.

So, why is this happening, and how should employees and employers proceed?

Why is the Job Market so Bad Right Now?

First, we ask the key question: why is the job market so bad right now?

It’s not just one issue causing the strain but a combination of economic, political, and workplace shifts that have created a challenging environment over the years.

Between slower hiring rates and an increase in fake job postings (yes, up to 36% of hiring adverts are fake or “ghost jobs”), finding employment feels impossible for many.
Planned mass layoffs in federal agencies are creating significant job losses, particularly in Washington, D.C., which could reduce nearly 19,000 positions. These cuts will likely have ripple effects on local economies and related industries.
As technology, especially AI and automation, advances rapidly, some roles are becoming obsolete while companies focus more on hiring for highly specialized skills.
Policy-induced uncertainties, including tariffs, immigration restrictions, and funding cuts, affect consumer behavior and aggregate demand. These factors contribute to reduced job security and hiring hesitancy among employers.

The Great Detachment phenomenon also reveals widespread worker dissatisfaction. Many employees feel disconnected from their jobs and hesitate to make career changes due to economic instability.

Key Statistics and Metrics

A deeper understanding of why the job market is so bad right now requires examining the numbers behind it.

USA Today reports hiring rates have fallen to 3.3%, below pre-pandemic levels (for reference, this number was 4.6% in 2021). Excluding the initial lockdown in 2020, the last time hiring rates were this low was in 2013, post-recession.
In December 2024, more than 22% of unemployed Americans had been out of work for at least six months, up from 20% the previous year.
As of January 2025, the median duration of unemployment is at 10.4 weeks – the highest since May 2017 (excluding the pandemic).

This trend is mirrored worldwide.

A LinkedIn report reveals that 37% of workers globally apply more but hear less from employers. Their data also shows that:

50% report that the job search has become more challenging over the past year.
22% of those job-hunting in 2024 are still searching for opportunities.
64% of global HR professionals agree that the job search process is becoming harder.

In addition, many job seekers face “ghost jobs” or fake listings that either aren’t hiring or have already been filled. Companies post them to build candidate pipelines, fulfill legal requirements, or maintain the appearance of growth, even when they aren’t actively hiring.

A recruitment survey by MyPerfectResume found that 81% of recruiters admit to posting ghost job ads. At the same time, an analysis by Resume Builder indicated that three out of ten companies currently have a ghost job advert active.

This deceptive practice wastes job seekers’ time and adds frustration and confusion to an already competitive hiring landscape.

The "Low-Hire, Low-Fire" Phenomenon

How is the job market bad right now when the U.S. unemployment rate remains relatively low at 4.1%?

This seems contradictory, given the lack of hiring, fierce competition, and the prevalence of fake job ads.

However, the reason lies within the current “low-hire, low-fire” state, where hiring is slow, and layoffs are minimal.

This cautious approach reflects a broader reluctance to make quick decisions in an unpredictable economic climate.

It’s also the consequence of trends like the Great Resignation or quiet quitting when many workers left their jobs to pursue better opportunities. Some of these employees have since felt the “Great Regret,” realizing that their decisions didn’t lead to the improvements they expected.

At the same time, employers who struggled with retention during this period now engage in “labor hoarding,” focusing more on keeping their current staff than expanding their workforce.

As a result, we experience a sluggish labor market without significant shifts in the unemployment rate.

Challenges for Job Seekers

From stagnant wages to rising job insecurity, many workers are navigating challenges that make career stability seem more unattainable than ever. These obstacles affect day-to-day job satisfaction and spark deeper concerns about long-term professional growth and personal well-being.

Salary Gaps

According to The Wall Street Journal, the wage gap between job switchers and stayers has narrowed significantly.

In early 2025, job switchers received an average raise of 4.8%, slightly above the 4.6% for stayers, a sharp decline from the 7.7% average in early 2023.

This trend makes salary negotiations more challenging for job seekers.

Intensified Competition & Ghost Jobs

The widespread use of AI tools for mass applications has heightened competition, reveals SHMR, especially for Gen Z in the job market. Approximately 68% of younger candidates feel AI has made job searching more competitive, with 71% encountering “ghost jobs” and 82% spotting scams.

Skill Gaps

Advancements in tech and AI are also impacting various job sectors.

The rapid pace of technological change demands continuous skill development, leaving many job seekers struggling to keep up with evolving requirements.

Workplace Inequities

Discrimination and biased hiring practices persistently undermine fairness in the job market.

In addition, nepotism and favoritism in the workplace, which are long-standing issues, further exacerbate this by allowing personal connections to influence hiring and promotions, giving some an unfair advantage while leaving others, often more qualified, at a disadvantage.

Are There Any Signs of Improvement?

To reiterate, the job market is bad right now.

However, despite the slowdown, there are some signs of improvement. While hiring may still be sluggish, market movements suggest a gradual recovery.

At the same time, specific industries are improving, with growth in particular sectors providing hope for job seekers.

Market "Thaw" Indicators

Recent data and trends suggest that conditions are shifting toward a more balanced employment landscape, hinting at a potential market “thaw” progressing into 2025.

As mentioned earlier, one argument in favor is that 63% of U.S. employers plan to create new permanent positions, signaling a positive movement.

The press release by talent solutions and business consulting firm Robert Half reveals this hiring activity is expected to occur in the first half of 2025, marking an increase from 52% in the second half of 2024.

According to their data, employers also plan to offer competitive salaries and use strategies like developing mentorship programs (35%), hiring contract workers for potential full-time roles (33%), offering paid internships (32%), and rehiring retired employees as consultants (22%).

Indeed’s 2025 U.S. Jobs and Hiring Trends report reveals further signs of this trend.

A key thaw indicator is the expectation of a “soft landing” for the economy. Indeed, it predicts the economy will stabilize without a severe downturn or mass layoffs. Employers will likely continue hiring, and although the market may cool, it won’t lead to widespread job losses or a deep recession.
The labor market in 2025 shows resilience. Amid slow hiring, unemployment remains low, and job openings remain strong. This stability means employers are still looking for workers, and the market isn’t as “stuck” as in past downturns.
Wage growth has leveled off at a healthy pace, signaling a thaw. After a period of fast growth, this stability suggests employers and workers are finding a balanced middle ground.
The rise of generative AI tools can also be seen as a sign of improvement. Despite the challenges, as more industries adopt these tools, productivity is expected to increase, which could ease labor market pressures.

While the economy has shown resilience, the margin for error is shrinking, meaning a potential downturn could quickly escalate if conditions worsen.

According to Indeed, some possible disruptors are slow labor force growth, an aging population, and declining immigration, which may lead to significant labor shortages and pressure on the job market.

Growth Sectors

Aside from the broader labor market challenges, several sectors are experiencing notable growth, driven by evolving demands and technological advancements.

The latest edition of the Demand for Skilled Talent report by Robert Half points out the key industries that are hiring right now:

Business and Professional Services – In late 2024, the industry added 664,800 new jobs, with roles in tech and IT, customer support, and finance
Healthcare – 145,200 new jobs, especially in medical receptionist and administrative roles
Manufacturing – 141,600 new jobs, with a focus on administrative support and tech positions
Financial Services – 110,790 new positions, with high demand for finance, accounting, and tech roles
Consumer Products – 100,600 openings, with a significant demand for customer service specialists
Tech and IT – 70,700 new jobs, with demand for senior software engineers, IT product managers, and marketing professionals
Education Services – 44,400 job openings, mostly in administrative roles
Government and Public Sector – 34,100 new jobs, mainly in administrative support and finance

This growth signals that while some areas may struggle, others offer new opportunities, especially for job seekers with skills in high-demand fields.

Structural Changes in Hiring

Building on the signs of improvement and the challenges we’ve seen, structural changes in hiring are also playing a key role in shaping the job market.

As companies adjust to technological advancements, economic shifts, and evolving worker needs, hiring practices are being redefined.

From the Future of Jobs Report 2025 by the World Economic Forum, we highlight the most critical shifts:

Upskilling and reskilling: Employers prioritize training and development to address skill gaps, with 85% planning to invest in upskilling their workforce. This shift means hiring will increasingly focus on candidates who can be trained or relocated within the company.
Hiring for specialized skills: As technological advancements and the green transition drive demand for new skill sets, there is a growing emphasis on skills-first hiring for specialized competencies, particularly in areas like AI, big data, cybersecurity, and renewable energy.
Focus on soft skills: With the rise of AI in the workplace, employers are also increasingly looking for candidates with strong human-centric skills, such as flexibility, creativity, and leadership, as these qualities complement technical expertise.
AI-driven recruitment: The integration of AI in hiring processes is becoming more common, from implementing ATS for quick resume screening to using predictive analytics tools to assess candidates’ fit for roles. This has led to a more data-driven, efficient recruitment process, although it raises concerns about fairness and bias.
Remote work and flexible benefits: The shift toward remote and hybrid work models has restructured hiring to accommodate candidates from diverse locations, allowing employers to access a broader talent pool.

Emphasis on employee well-being: As companies prioritize talent attraction and retention, there is a growing emphasis on hiring with consideration for employee well-being. Employers are strengthening their benefits packages, from mental health support and counseling services to wellness programs and childcare benefits.

Strategies for Job Seekers

What can employees do to navigate this complex hiring landscape and land a job faster?

As the digital space becomes saturated with job ads, how can they recognize legitimate opportunities and steer clear of potential scams?

Given these challenges, the right strategies can make all the difference. They allow the workforce to find the right opportunities more quickly while avoiding the risks of an overwhelming and often misleading job market.

Forbes’s Job Seekers Guide specifies the following strategies and practices:

Customize resumes with relevant keywords to pass through AI and resume scanners
Highlight soft skills like communication, adaptability, and problem-solving
Demonstrate experience or adaptability to remote and hybrid work environments
Show cultural intelligence and a commitment to creating inclusive workplaces
Quantify accomplishments and provide measurable outcomes to recruiters
Tailor each resume to the specific job, focusing on relevant keywords and results
Write personalized cover letters that connect personal experience to company values
Keep an updated LinkedIn profile and engage with industry content to increase visibility
Prepare for behavioral interviews using the STAR method to demonstrate problem-solving and collaboration skills
Network both online and offline to expand connections and access hidden opportunities
Gain experience through volunteering or freelancing to build skills and show initiative
Pursue relevant courses or certifications to enhance qualifications and personal growth
Seek referrals from within a professional network to increase interview chances

The last one is also a proactive strategy to avoid ghost jobs, as referrals can help confirm whether the position is still open and if the company is actively hiring, reducing the risk of applying to non-existent positions.

Future Outlook

In retrospect, yes, the job market is bad right now, but it shows signs of improvement in some areas.

Job losses are expected in sectors vulnerable to automation and shifting policies. Still, many industries will likely experience considerable growth, creating new positions that didn’t exist a decade or even a few years ago.

While predicting the future remains challenging due to shifting trade relations, policy changes, and global politics, one thing is clear: those who can adapt to these changes will have an advantage.

The ability to navigate uncertainty, rather than resist it, could make all the difference in the coming years.

Written by tamara jovanovska

Content Writer at Shortlister

Sources

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