America saw pandemic-level layoffs in 2025, and experts are predicting 'uncomfortably slow' job growth in 2026. How to navigate a difficult job market

“I had three amazing interviews with the recruiter, and the hiring team called me in for a lunch ‘meet and greet' with the team I’d be managing. It was a wonderful, enjoyable lunch, and I left feeling very confident,” a job seeker commented on Hiring Hub (2).

“Now, a week has passed, and nothing. I don’t think it’s fair or professional to leave me hanging. I really just want to hear something.”

Job market conditions aren’t expected to change much in 2026. Even though economic growth is looking up, unemployment rates are predicted to remain elevated (3).

What’s behind the stagnant market

Hiring rates were grim for job seekers across most sectors in 2025. The year showed the weakest rates of employment growth outside of recession years since 2003, CNN reported, citing U.S. Bureau of Labor Statistics data (4). The year ended underwhelmingly with just 50,000 new jobs added in December, below expectations.

If an applicant manages to land a position, the fear of layoff can linger. An October 2025 Harris Poll for Bloomberg (5) showed that 55% of Americans were concerned about losing their jobs.

The year saw a surge in layoffs with employers letting go more than 1.2 million Americans from their roles, 58% higher than in 2024 and the highest rate since 2020 pandemic levels, according to Challenger, Gray & Christmas (6).

Government jobs and the technology sector were hit hard, with companies like Microsoft, Amazon and Verizon shedding large portions of their workforces (7).

Business uncertainty was high in 2025, with fluctuating trade policies and President Donald Trump’s tariffs on imported goods making companies wary of hiring or adding new roles.

“Businesses are hesitant to make sweeping changes to either grow or shrink their payrolls when they’re unsure what the next six months might hold.” said Michael Feroli, chief U.S. economist at J.P. Morgan, at the end of 2025 (3).

And while immigration reform and deportation rates have been aggressive, open roles once held by migrant workers have not been filled evenly by American job seekers, and, according to J.P. Morgan, breakeven employment could decrease from 50,000 to 15,000 per month in 2026.

The firm predicts the job market growth for the first half of 2026 will be “uncomfortably slow,” with unemployment peaking at 4.5% and the “quits” rate — employees voluntarily leaving their jobs for new roles — remaining lower than pre-COVID, indicating anxiety in losing work and uncertainty in the ability to find a new job.

It’s not all doom and gloom, though.

The latter half of 2026 just might begin to look up. Tariff and trade policy is expected to solidify and level out, potentially allowing businesses to feel more secure in spending money on payroll. Also, the Federal Reserve is expected to introduce cuts to interest rates later in the year (8), potentially injecting spending and stability into the market.

How you can weather the job market

Waiting around a while for a job to come through is always a possibility, but you might need to expect a long period of unemployment in this current job market. More than a quarter of unemployed Americans are now defined as “long-term”, or jobless for 27 weeks.