A cooling labor market, characterized by sluggish hiring and anemic job creation, made it hard for job seekers to find work in 2025, according to economists.
“It’s fair to say that 2025 was a hiring recession in the United States,” Heather Long, chief economist at Navy Federal Credit Union, wrote in a note Friday. That recession affects both blue- and white-collar workers, she wrote.
U.S. employers added 584,000 jobs last year, according to a Bureau of Labor Statistics report issued Friday. That marks the worst year for total job gains outside of a recession since 2003, according to Long. There has been little job creation since April, meaning most gains took place early in the year, she wrote.
Most hiring has also been concentrated in the health-care sector, making it difficult for workers to participate across the broad labor market, economists said.
“Healthcare alone accounted for roughly 69% of all job growth across 2025,” Nicole Bachaud, a labor economist at career site ZipRecruiter, wrote in a note Friday. “The reliance on a single industry to keep job growth positive uncovers the unstable foundation in play going into 2026.”
