{"id":21925,"date":"2025-10-22T15:16:44","date_gmt":"2025-10-22T15:16:44","guid":{"rendered":"https:\/\/incredipros.com\/?p=21925"},"modified":"2025-10-22T15:16:46","modified_gmt":"2025-10-22T15:16:46","slug":"the-inside-story-of-americas-slowing-job-market","status":"publish","type":"post","link":"https:\/\/incredipros.com\/?p=21925","title":{"rendered":"The Inside Story Of America’s Slowing Job Market"},"content":{"rendered":"
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Andy Challenger is the person businesses call when it\u2019s time to let workers go. And for the past year and a half, his phone hasn\u2019t stopped ringing.\u00a0<\/p>\n

A third-generation outplacement consultant at Challenger, Gray & Christmas \u2014 the firm his grandfather founded in the 1960s after his own layoff \u2014 Challenger has heard a variety of reasons over the past few months for trimming headcount. Companies looking to cut staff after the pandemic-era hiring boom. Executives debating how to integrate artificial intelligence. Businesses worrying about eating the cost of higher tariffs. Firms tightening their belts in a slowing economy.<\/p>\n

As economic data continued to suggest a shockingly resilient labor market, his workload told a different story.<\/p>\n

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\n For the past four or five months, things have been worse than the numbers showed. There has been an increase in layoffs, and from what I know, there will be continued layoffs for the next few months.<\/q>
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\n \u2014 Andy Challenger, chief revenue officer at outplacement firm Challenger, Gray & Christmas
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Anyone who has watched a friend lose work, seen a \u201cNow Hiring\u201d sign quietly come down, scrolled through LinkedIn profiles marked \u201c#OpenToWork\u201d or worried about how far your own paycheck will stretch, knows what Challenger is talking about. Economic reports can tell one story; your reality often tells another.<\/p>\n

For much of the past few years, Americans have been told the job market was strong. The numbers showed solid hiring and low unemployment. Economists have said it\u2019s propped up the entire economy, fueling consumer spending that keeps surprising forecasters.\u00a0<\/p>\n

But for many, that story has never quite matched what was happening at their kitchen tables. More than 2 in 5 workers (43 percent) didn\u2019t receive a pay increase at all over the past 12 months, the highest in four years and a sign of a slowing job market, according to Bankrate\u2019s new Pay Raise Survey. A rising share of Americans in the labor force (42 percent in 2025 from 36 percent in 2024) also say they aren\u2019t confident they\u2019ll find a better-paying job or get a pay raise at their current position over the next 12 months.\u00a0<\/p>\n

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\n More workers than ever say their pay isn\u2019t keeping pace with inflation
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A record 62% say their income hasn\u2019t kept up with their expenses, climbing from 55% in 2022.<\/p>\n

Read more<\/p><\/div>\n<\/div>\n

Economists are realizing that Americans were right all along<\/h2>\n

The data may finally be starting to reflect Americans\u2019 experiences. Hiring over the past four months has flatlined. Recent revisions from the Bureau of Labor Statistics show the economy added nearly a million fewer jobs \u2014 911,000 \u2014 than previously reported between March 2024 and March 2025. All of it\u2019s adding to signs that Americans may have gotten it right, economists say.\u00a0<\/p>\n

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\n The data did catch up to what people were saying. In hindsight, it\u2019s very clear the job market has been frozen for longer than we realized. People who were trying to say, \u2018this is not my experience\u2019 were vindicated when the final revised data was coming out.<\/p>\n

\n \u2014 Heather Long, chief economist at Navy Federal Credit Union<\/cite>\n <\/p>\n<\/blockquote><\/div>\n<\/p><\/div>\n<\/div>\n

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The numbers, though, still might not be telling the full story. The U.S. economy grew by the fastest pace in almost two years last quarter, but that might be because upper-income Americans are propping up spending. The top 10 percent of Americans now account for nearly half of consumer spending, up from 35 percent in the early 1990s, according to Moody\u2019s Analytics. <\/p>\n

Meanwhile, artificial intelligence is juicing up the economy. Business investment in intellectual property contributed just over one-fifth of recent economic growth in the second quarter of this year, data from the Department of Commerce shows.<\/p>\n

The disconnect can give Americans the perception that they\u2019re struggling alone. Over 2 in 5 (43 percent) U.S. adults say money negatively affects their mental health, above things like their health and relationships or even politics and world news, according to Bankrate\u2019s Money and Mental Health Survey. <\/p>\n<\/div>\n<\/div>\n

Those Americans are also nearly three times more likely to have paid a bill late in the last month, the survey found.<\/p>\n

\u201cIf everyone is struggling, well, then it\u2019s a systemic breakdown. If I\u2019m the one struggling, whether that\u2019s true or not, well, there\u2019s something wrong with me,\u201d says Nate Astle, a certified financial therapist and the founder of the Financial Therapy Clinical Institute. \u201cMy cynicism for the media or the stats I\u2019m hearing and my distrust of institutions grows even wider because this isn\u2019t even close to my experience.\u201d\u00a0<\/p>\n

Those discrepancies also make it harder for policymakers to prescribe the right medicine. Federal Reserve officials cut interest rates at their September meeting to give the labor market more support, but they\u2019ve been cautious about moving too quickly, fearful that they could worsen inflation. Keeping rates high for too long, though, could weaken the job market even more.<\/p>\n

\u201cIn this moment in particular, there is a greater need to understand what\u2019s going on at different income levels and for different populations,\u201d Long says. \u201cFor the bottom 80 percent, we can see it in their spending habits. This is not a boom time for them. This is very much a back to the paycheck-to-paycheck lifestyle. The real concern is, when does it go from paycheck to paycheck to starting to miss bills?\u201d<\/p>\n

The job market might not be getting much better, says this small business owner<\/h2>\n

Chris Taylor has a foot in both worlds. A trained economist turned small business owner, he co-owns Manhattan\u2019s oldest chocolate house, Li-Lac Chocolates, with six locations around New York City. But Taylor doesn\u2019t need data to confirm that the job market is slowing. He sees it on the ground.\u00a0<\/p>\n

\u201cWe are getting seriously qualified candidates that six months ago wouldn\u2019t be bothered to talk to us,\u201d he says. \u201cThe Fed sets interest rates based on whatever magic formulas they have, and then you ride the wave. You can\u2019t control the waves that you ride, but I see huge labor market weakness, and I see huge pricing pressure on the retail side.\u201d<\/p>\n

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\"Chris<\/figure>\n
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Taylor doesn\u2019t foresee the picture changing much anytime soon. Li-Lac\u2019s costs have stayed manageable thanks to year-ahead contracts for chocolate and gift boxes, but they\u2019ll have to place another order after the holidays. If the Supreme Court upholds President Donald Trump\u2019s steep \u2018reciprocal tariffs,\u2019 Taylor expects a major jump in expenses. He\u2019s searched for U.S. suppliers with the same quality and reliability but hasn\u2019t found any.<\/p>\n

He doesn\u2019t know if he can pass those higher costs along to his customers, either. Taylor first noticed a slump in sales back in August, which he mainly attributes to weaker tourism. <\/p>\n<\/div>\n<\/div>\n

To stay afloat, he\u2019s implementing a hiring freeze for his 70 permanent employees and rethinking raises, after previously boosting pay an average of 25 percent over the past three years.\u00a0<\/p>\n

\u201cIf my costs increase on raw materials, I have to cut it somewhere, and I have to cut it in labor,\u201d he says. \u201cI like to give good raises. It\u2019s cheaper to pay good people well than it is to pay mediocre wages.\u201d\u00a0<\/p>\n

Like many business owners, Taylor isn\u2019t planning layoffs yet, but he\u2019s bracing for the possibility. Chocolate prices have already quadrupled in four years. Every week another small chocolatier calls him looking to sell.\u00a0<\/p>\n

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\n \u201cThe biggest enemy of business is uncertainty. You can give me any bad news as long as it\u2019s something I can plan around. It\u2019s the uncertainty that hurts you. Every business owner is pulling back on spending, whether it\u2019s investment or payroll or whatever. The damage is already done.\u201d\u00a0<\/p>\n

\n \u2014 Chris Taylor, co-owner of Li-Lac Chocolates<\/cite>\n <\/p>\n<\/blockquote><\/div>\n<\/p><\/div>\n<\/div>\n

A tough economy forced this small business owner to close up shop<\/h2>\n

Hidden behind the numbers is also heartbreak. Nicole Panettieri had just finished teaching college students how to create a small business proposal when she realized it was time to say goodbye to one of her own.\u00a0<\/p>\n

Panettieri owns two boutiques in Astoria, Queens: The Brass Owl, a women\u2019s apparel and accessories shop that she opened in 2014, and The Tiny Owl, a toy and children\u2019s store she launched after the pandemic.\u00a0<\/p>\n

But her debts were piling up, her rent was rising faster than her sales and tariffs had pushed The Tiny Owl\u2019s costs up about 15 to 20 percent. When a Target opened around the corner, foot traffic died.<\/p>\n

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At the end of October, she\u2019ll close The Tiny Owl for good, laying off two employees and cutting hours for three more.<\/p>\n

On the subway ride home from class, she cried for the first time.<\/p>\n

\u201cThe day I told my team that it was gonna happen, it felt the most real,\u201d she says. \u201cWe all fought really hard to make it work. It feels like we all failed. There were too many obstacles for a business that\u2019s only three years old.\u201d\u00a0<\/p>\n<\/div>\n

\"Nicole<\/figure>\n<\/div>\n

Motherhood and the experience of navigating city life with a newborn during the pandemic, changing diapers on park benches, inspired her to open the kids\u2019 store. She vowed to create a safe space for families that she never had. Toys quickly became her bestseller, making up more than half of her business. She had hopes of eventually expanding. Then, tariffs hit.<\/p>\n

Prices jumped almost overnight. Vendors canceled shipments or delivered goods with duties higher than the cost of the order. She had no choice but to pass the increases on to customers. All the while, she watched as passersby outside carried shopping bags from her lower-priced national competitors around the neighborhood.<\/p>\n

\u201cOnce prices are up, they\u2019re up,\u201d she says. \u201cNo one goes backwards.\u201d<\/p>\n

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