As career expert Mandi Woodruff-Santos explains, the U.S. job market is extremely daunting for recent college graduates right now. Job seekers are under the gun. In her latest review, she went so far as to say it’s “kind of trash right now.” She noted that opportunities are few and far between and competition is tough.
Further, in April employers hired at a historic bottom notch clip. This was the slowest quarterly increase in more than a decade, outside of the first three months of the Covid pandemic. Recruitment has come to a standstill, as seen more broadly throughout this turbulent labor market. The rate at which workers are quitting their jobs has fallen below pre-pandemic levels. Though nationally unemployment remains low at 4.2% as of May, the future for job seekers looks bleak.
Heather Long, chief economist at Navy Federal Credit Union, echoed these sentiments, stating, “It will be a tough summer for anyone looking for full-time work.” As her analysis reveals, today’s job market is characterized by a strange “surplus of caution.” Employers are intentionally backfilling only the most essential roles. This cautious approach leaves many graduates struggling to secure employment.
In May, businesses added 251,000 jobs—well over 80,000 more than economists were predicting. This economic expansion has not created a robust labor market for job seekers. CEOs are increasingly cooling on plans to grow their headcounts. That’s a decline from 32% in Q1 to 28% in Q2. The share of CEOs who expect to reduce their workforce has gone up a point to 28%.
Uncertainty regarding geopolitical instability, trade dynamics, and tariff policies has emerged as a major business risk, according to Roger Ferguson Jr. These elements combine to instill a culture of reluctance within the business community. Consequently, this makes it harder and harder for job seekers to find out about these opportunities.
“We’re indeed in a very precarious situation,” said Cory Stahle, a labor market analyst with the Department. He noted that in a low-hiring, slow-growth environment, employers can only afford to lose their current workers for so long. Sooner or later, they’ll need to face down the specter of layoffs too. He warned that this has the potential to inflate the unemployment rate even as available jobs continue to shrink.
“The steady erosion in the US job market cannot continue forever — at some point, there will just not be much left to give.” – Cory Stahle
Despite these challenges, Woodruff-Santos had some hopeful guidance for those trying to make it in such a competitive job market. To make those professional connections, she underscored the value of getting comfortable with being uncomfortable. “You need to put yourself in situations where you may not know everybody, you may not know one person, where you may actually need someone to give you a bit of a helping hand, and to feel confident and OK doing that,” she stated.
The going-forward potential for recovery, even in the job market, is less clear. For all that some economists agree a recession doesn’t appear to be imminent, the picture for the one in five job seekers is alarming. As Long noted, this job market is unprecedentedly bad. To support his argument, he claimed that this isn’t actually anything new. It’s simply a challenge we are facing in a different cycle.