Unemployment Hasn’t Spiked...So Why Can’t Anyone Find A Job?

In 2026, the U.S. unemployment rate is currently 4.3%. By historical standards, this is pretty good, this is pretty solid. And the data shows 130,000 jobs were added in January, and the unemployment rate remains mostly steady at 4.3%. If unemployment isn't high, why is the job market so awful? It feels like it's never been harder to get a job. The story is stranger than we might think. Something is happening that we haven't seen before. Why do things feel so bad if the unemployment rate is pretty good? And why are thousands of companies posting job listings they have no intention of filling? Now, the instinct for many people is to say it's AI. AI is causing all these problems. And there is truth to that. But there's more going on here. First, let's look at what AI is doing. For one, lots of layoffs and redundancies. 1,500 from Meta, then another 8,000. 1,600 from Atlassian, 4,760 from PayPal, 16,000 from Amazon, and 30,000 from Oracle. So far this year, there's been over 300,000 layoffs, over 85,000 from tech alone, a 33% jump from this time last year. Feels especially bad when CEOs refer to layoffs as lower-value human capital. But more than that, AI is doing something else. A 2026 study from BCG said that, over the next 2-3 years, 50-55% of jobs in the US will be reshaped by AI. They retain the same or a similar role, but face radically new expectations for how they work and what they produce. Perhaps the most worrying part is entry-level jobs, which are starting to decline. Postings for entry-level jobs in the US have plummeted by 35% in the last 18 months, largely thanks to AI. So it seems particularly bad for those trying to get into the workforce through roles like these, as the more basic tasks which require less experience are the ones most vulnerable to AI. While it sucks to be working in tech right now, this AI displacement doesn't seem to have the exponential growth people were saying it would. Initial evidence suggests that transitional disruption from AI to date is not outpacing recent technological changes. A similar pace to that years after the start of the commercial computer era in 1984 and the commercial internet era in 1996, and it has not accelerated since the release of chatGPT. According to a survey of over 2,000 businesses across 9 different countries, including the US, 42% say AI has created jobs across their organizations, 11% say AI has eliminated roles, and 35% report a mix of both, heading to 77% reporting job creation versus 46% reporting job loss. Though these are responses from companies, so take that with a grain of salt. But there is something that shows this is more than just AI, although it's causing other problems we'll get to soon. But AI doesn't explain everything outside of tech. A lot of jobs that can't be replaced by AI seem to be the ones in the worst situation. Most assume blue-collar jobs would be doing great. Some people are saying, leave white-collar, move into trades, you'll get a job. AI can't replace a plumber. And that is true, but that's not what's happening. According to the Bureau of Labor Statistics, the industries with the worst change in hiring were trade, construction, and federal jobs. Look at that graph. Information, professional, and financial are showing fewer hires in the last few years. But it's not just white-collar jobs. Interestingly, healthcare is the industry with the most explosive growth. Healthcare represented 47.5% of all job growth during 2025. So, what's going on, really? With the current job market, a lot of people have to re-evaluate their career. It feels like the market is redefining what a job even means. And many are deciding to try running a business. Business applications are at record highs. And it makes sense. More and more businesses are being started out of necessity. 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They've already fulfilled over 60 million orders to over 200 countries and territories with a vast printing network across the US and Europe, meaning fewer fees and faster shipping times. Click the URL in the description and use code logically. Thank you to Printify for sponsoring this video. The labor market is in a very weird spot. Unemployment isn't skyrocketing, but new jobs added are historically low. This number is now 181,000 jobs created last year. That is the weakest year for jobs since at least 2003. That is just, essentially, the average last year was about 15,000 jobs added every month. That is barely any job creation. So that is, I think, what the real headline is from these numbers, the revisions to last year showing a labor market that basically was not moving forward. The total number of employees is mostly flat. We're essentially in a freeze. A low hire, but also a low fire market. The hiring rate has gradually been decreasing for the past few years. In February 2026, this hit 3.1, about the same as the collapse at the start of the pandemic. Fewer companies are hiring people, though it's floated around this low point for a few years now. But interestingly, also firing fewer. Job openings are around 7 million. Down a lot from a few years ago, and now, quite flat. But the job opening rate is also flat at 4.1%. The number and rate of layoffs and discharges were little changed at 1.9 million and 1.2%. Layoffs and discharges were little changed in all industries in March. What's happening is that companies aren't keen to hire more staff, but aren't so keen to lay off people, as the cost of replacing an employee is quite high. Not only that, staff aren't keen to leave their jobs right now. Fewer people are keen to quit, which creates even fewer job openings. It's an unusual and uncomfortable kind of balance. So why are we in a low hire, low fire situation? Well, a few reasons. First, I think this is a pendulum swing after COVID. There was a hiring boom after the pandemic, and perhaps a lot of companies overhired. Another is perhaps the recent tariffs. These increased the costs of doing business, more expensive parts, lower margins, and less profit, meaning less desire to hire. And it's likely to stay this way for a while. We should expect low hire, low fire to be more the norm going forward. We have really been marking our calendars for the first half of 2026 for really the full kind of suite of the tariff impacts to really roll through the businesses and therefore the labor market. But this low hire, low fire market feels especially bad when we take another perspective. Total jobs are steady. But this, along with a lot of jobs added stats, miss one important nuance. Full-time versus part-time. Full-time employment is either flat or declining. Part-time is going up. The labor market success has been fueled mostly by part-time job growth rather than by the addition of full-time jobs. The Household Survey suggests an explanation for why Americans don't perceive a robust labor market. From their point of view, it isn't robust. People might not be fired. But instead, their job might be changed, moved from full-time to part-time. Or a company might remove one full-time job but add two more part-time roles. On the surface, it looks like job growth, but it's really not. It's those who are unemployed and trying to find work who have it worse than ever. The market is terrible for job hunters right now. The actual process of getting a job is, I'd say, the worst it has ever been in history for a lot of reasons. On our channel, we do all kinds of deep dives into economics, companies, and finance. There's a lot these stories can teach us. So subscribe. We're almost at 1 million now and you can help us get there. Applicants per job posting in 2021 was about 45. In 2025, it was 95, more than double. With a low hiring rate, more and more people are applying for those jobs that are out there. But to make matters worse, many of these jobs don't even exist. Essentially, you find a job listing from a real legitimate company. It has all the components of a normal job, like responsibilities, experience needed, everything. Looks legit. You write a cover letter, send your resume, maybe send up a follow-up email a few weeks later. Except, this job doesn't even exist. These are ghost jobs. Fake listings by real companies. These have existed for a while, but it's getting much, much worse. Hires per job has fallen from 0.75 in 2018 to below 0.5 in 2023. It's likely even lower today. That means less than half of job postings will result in a hire. Not that you're less likely to get that job, but more so that anyone will be hired for that job. Surprisingly, those blue-collar jobs like construction are being hit the worst. Construction has it the worst, with 38% of postings classified as ghost jobs, followed by the art industry, and then legal jobs at 34% and 29%. Administration and support has seen a negative 55% change in hires to job postings, followed closely again by construction. A 2024 survey found that 39% of hiring managers admitted their companies posted fake job listings in the past year. Among those, 26% said they posted 1-3 fake listings, while 13% reported posting 75 or more. So why do this? This seems like such a waste of time, not just for applicants, but even the companies. Well, there's a few reasons. First, many publicly traded companies will post fake job listings, not for jobs, but as part of their PR strategy. A 2024 study found that almost 1 in 4 recruiters were asked to keep postings live for visibility, not active hiring. In another survey, 23% said it helped make the company appear more stable during a hiring freeze. If you look like you're hiring, it implies you're growing, doing well, and investment is more appealing, for public companies and even private companies. But the second reason is even worse. Another survey found 62% of hiring managers use fake job listings to have employees feel replaceable. That's right, to make employees work harder and make them feel like they have less job security. So they're not just harming people looking for work, but people inside the company. The third reason is compliance requirements. If the company already had someone in mind who's actually the perfect fit for the job who's worked there for a while, they still have to go through the song and dance of pretending to hire. Hiring within a company is a good thing. Letting employees move up or maybe horizontally to a more enjoyable job is great. But they still create a job listing and waste everyone's time. Recruiters and HR to be honest feel like the villains in a lot of this. People are using AI to apply for jobs and recruiters are using AI to hire people. 87% of companies and 99% of the Fortune 500 are using it in their hiring processes. 65% of recruiters rely on it daily and 24% use it as their primary hiring method. 81% for candidate sourcing, 73% for resume screening, 68% candidate communication via chatbots. And you can see why. It's 30-40% cheaper and the time to hire is up 50%. But boy does it suck to go through. No one is looking at any job applications and people are getting rejection emails before anyone even looks at their resume. It's especially bad because hiring doesn't often fall to a team lead but HR. A manager might identify the best possible candidate, but they don't actually matter. HR does. This is why you sometimes get weird skill requirements on a job listing or in an interview because recruiters often have no idea what the job actually involves. Not to mention, it's especially bad with some companies just lying on job listings. Listing a job as remote than saying it's an on-site position and requires an in-office presence. Even if unemployment isn't growing much, it's not a great time to be job hunting, especially as people are stuck unemployed for longer and longer. Many are applying for hundreds or even thousands of jobs and getting nowhere. This is made worse by companies abusing the job postings to do something it was never meant for. Something definitely needs to change. Potentially new legislation to ensure the job market is doing what it's supposed to. Giving people a chance to be hired. Giving companies a chance to find a new employee when there's actually a free position. Not for PR, not to scare employees, or just because they legally have to post it. One piece of good news though is that AI replacements aren't working as well as many thought. AI customer service, AI layoffs are actually backfiring for a lot of companies and CEOs are starting to regret it. Click here to learn the rest of the story. But until then, I'm Hari and I'll see you guys on the next one.