Carly Kaprive relocated to Chicago from Kansas City a year ago, anticipating a new job search would last between three and six months. Ultimately, the project manager, who is 32 years old, had not experienced unemployment for more than a three-month period.
TL;DR
- A 32-year-old has managed over 700 job applications for a year in a tough market.
- The job market shows infrequent hiring and dismissals, creating a "jobless boom."
- Unemployment rate is low, but hiring conditions are the slowest in over ten years.
- Jobless individuals face difficulties securing employment despite a growing economy.
Despite submitting 700 applications, she continues her search, caught in a frustrating and prolonged job hunt that's proving significantly tougher than her last one a couple of years prior. Amidst concerns regarding interest rates, tariffs, immigration, and the impact of artificial intelligence on the broader economy, certain firms she's spoken with have suddenly opted to leave positions vacant.
“I have definitely had mid-interview roles be eliminated entirely, that they are not going to move forward with even hiring anybody,” she said.
Kaprive finds itself in a peculiar economic situation: despite a low unemployment rate and a still growing economy, individuals seeking jobs are experiencing the slowest hiring conditions in over ten years. Diane Swonk, chief economist at KPMG, refers to it as a “jobless boom.”
Although big corporate layoff announcements often garner the most notice, the reluctance of numerous businesses to hire more staff has resulted in a tougher job market than the 4.3% unemployment figure might indicate. The economy is also more divided: The “low hire, low fire” economy has resulted in fewer job cuts for employed individuals, while those without jobs face difficulties in securing employment.
“It’s like an insider-outsider thing,” Guy Berger, head of research at the Burning Glass Institute said, “where outsiders that need jobs are struggling to get their foot in, even as insiders are insulated by what up Up to this point, it's a low-layoff setting.
In recent weeks, numerous major corporations, such as UPS, Target, and IBM, have revealed plans to eliminate tens of thousands of positions, though Berger indicated it's premature to determine if these actions signify a Economic downturn. A surge in layoffs would present a significant hurdle, especially given the current scarcity of hiring.
Currently, it's more challenging than usual to get a precise understanding of the job market due to the government shutdown, which has halted data from the U.S. The monthly employment reports from The Department of Labor. The October jobs report, originally slated for release on Friday, has been postponed, similar to the September figures before it. The October report might be less thorough upon its release due to potential incomplete data collection.
The Labor Department announced that prior to the shutdown, the employment rate, representing the proportion of employed individuals hired in a specific month, decreased to 3.2% in August, reaching its lowest point outside of the Since March 2013, the pandemic has been ongoing.
Back then, the unemployment rate was a painful 7.5%, as the economy slowly recovered from the job losses from the 2008-2009 Great Recession. This figure significantly exceeds August's 4.3% rate.
A significant number of unemployed individuals doubt the current low unemployment figure. For the last three years, 54-year-old Brad Mislow has largely been out of work, a situation that began after he was let go from his advertising executive position in New York City. He's currently substitute teaching to cover his expenses.
“It is frustrating to hear that the unemployment rate is low, the economy is great,” he said. “I think there are people in this economy who are basically fighting every day and holding on to pieces of flotsam in the shark-filled waters or, they have no idea what it’s like.”
Amidst the government shutdown, financial markets are focusing more intently on private sector figures, which are also showing a mixed picture. On Thursday, the outplacement firm Challenger, Gray & Christmas unnerved investors with a report that announced job cuts surged 175% in October from a year ago.
However, on Wednesday, payroll processor ADP reported that net hiring accelerated in October, with businesses creating 42,000 jobs, following two months of decreases. However, the increase was slight. ADP’s figures are based on anonymous data from the 26 million workers at its client companies.
Revelio Labs, a company specializing in workplace analytics, estimated on Thursday that the economy lost 9,000 jobs during October. The Federal Reserve Bank of Chicago estimates reported a slight increase in the unemployment rate, reaching 4.4% during the previous month.
Even when the government was releasing data, economists and officials at the Federal Reserve weren’t sure how healthy the job market was or where it was headed next. A sharp drop in immigration and stepped-up deportations have helped keep the unemployment rate low simply by reducing the supply of workers. The economy doesn’t need to create as many jobs to keep the unemployment rate from rising.
Jerome Powell, chair of the Federal Reserve, has called in a “curious balance” because both the supply of and demand for workers has fallen.
Economists point to many reasons for the hiring slowdown, but most share a common thread: Greater uncertainty from tariffs, the potential impact of artificial intelligence, and now the government shutdown. While investment in data centers to power AI is booming, elevated interest rates have kept many other parts of the economy weak, such as manufacturing and housing.
“The concentration of economic gains (in AI) has left the economy looking better on paper than it feels to most Americans,” Swonk said.
Younger Americans have borne the brunt of the hiring slowdown, but many older workers have also struggled.
Suzanne Elder, 65, is an operations executive with extensive experience in health care, and two years ago the Chicago resident also found work quickly — three months after she left a job, she had three offers. Now she’s been unemployed since April.
She is worried that her age is a challenge, but isn’t letting it hold her back. “I got a job at 63, so I don’t see a reason to not get a job at 65,” she said.
Like many job-hunters, she has been stunned by the impersonal responses from recruiters, often driven by hiring software. She received one email from a company that thanked her for speaking with them, though she never had an interview. Another company that never responded to her resume asked her to fill out a survey about their interaction.
Weak hiring has meant unemployment spells are getting longer, according to government data. More than one-quarter of those out of work have been unemployed for more than six months or longer, a figure that rose sharply in July and August and is up from 21% a year ago.
Swonk said that such increases are unusual outside recessions.
A rising number of the unemployed have also given up on their job searches, according to research by the Federal Reserve Bank of Minneapolis. That also holds down the unemployment rate because people who stop looking aren’t counted as unemployed.
But Kaprive is still sticking with it — she’s taken classes about Amazon’s web services platform to boost her technology skills.
“We can’t be narrow-minded in what we’re willing to take,” she said.