When Federal Reserve President Geom Powell opened the door on Friday Interest rate reduction For the first time in about a year, he said that the shock starting to shake a main pillar of the American economy said: Labor market.
After showing a sharp recession in government figures, the concern about the speed of increase in the job was increased early this month. HireWith much weak payroll benefits in May and June than before thought. Disappointing number was worrying enough for President Trump to question his accuracy Fire to the head of the agency Worked with compiling data.
Nevertheless, labor experts tell CBS News that they were not surprised by the recession, and take care that there may be more pain for job seekers. Data released since August 1 shows Fresh American tariff And the arrival of artificial intelligence, they say.
“There is a real cooling in the labor market,” Andy Challenger, Senior Vice President, Gray and Christmas of Executive Outplement firm Challenger, told CBS Manivatch. “We are having a lot of personal conversations with companies that are telling us to expect the future trimming.”
He said, “For me, the more reason to be pessimistic about the labor market is that we will see some major bounce back.”
There are three charts that can point to a serious recession in the American job market.
Fewer workers are being hired
Overall, in 2025, American employers have added less jobs on a monthly basis in recent years when companies have sought to expand. The economy returned From the epidemic. Powell said on Friday that in 2024, employers had hired 168,000 workers every month, but have slowed down to an average of 35,000 in the last three months.
The risk is that the labor market can weaken from here, which “rapidly can be high pruning and rising unemployment,” Powell said.
The recession may motivate the fed to cut its benchmark interest rate, the main equipment of policy makers to increase the growth of the economy and job, in its meeting for the first time since December 2024. Lower rate rates can reduce the labor market as it will make consumers cheaper to borrow, spend driving, in which businessmen have been spent to invest.
Long -term job seekers
Another disturbing signal has a recent surge among long -term job seekers, or people who have been looking for a job for more than 27 weeks. In July, about 1.8 million Americans had been looking for work for more than 27 weeks, three years ago about 64% and 20% from one year ago.
Challenger said that given the signs of employers, it can never be easy to find work soon.
“In search of new work,” don’t stop summer “, he advised job-skills.” It is difficult to imagine a landscape where the labor market will be better in three to six months. “
A jump among unemployed young workers
At the same time, young workers are also having more trouble finding their first jobs, who have been blamed by everything. Slow down This year those who adopt artificial intelligence to employers Entry-level workers’ location,
To ensure this, the country’s unemployment rate is 4.2%lower. Nevertheless, this figure is going to look backward, which shows the strength of the labor market in the last months-it says very little about the economic conditions moving forward.
Meanwhile, New College is currently “an ideal storm” in the job market, Career Coach Tracy Newell said.
He said, “Companies are limiting new entry-level roles, and AI is replacing many traditional ‘starter’ jobs,” she said, seeing that these days it is not uncommon for employers to receive hundreds of job applications for the same situation.
