In 2025, the job market in the United States will be extremely challenging, and in 2026, there is also little relief in sight.

For Americans currently job-seeking, this year is a tough one. Forecasters predict that job prospects will not improve much in 2026 either. Economists say that despite steady economic growth, the unemployment rate is expected to remain high for most of next year. Some point out that this unusual combination is due to the increasing influence of artificial intelligence investments, which are driving economic growth without promoting employment. A stagnant labor market means that next year will once again see limited job opportunities and slowing wage growth, exacerbating financial pressures on American households ahead of the midterm elections. This also means that employment structures will increasingly tilt towards the healthcare industry, which contributed almost all of the net job growth in 2025. Chief economist at PwC, Diane Swonk, said, "Much of the GDP growth we're getting is from AI infrastructure investments, which create few jobs, and AI is causing some job losses. We're not yet clear on the extent of this. It looks like this is just the beginning." While economists say the US is not in a recession, the latter half of 2025 feels like one for many job seekers. In the five months between June and November, the unemployment rate has risen by 0.5 percentage points, reaching 4.6%, which is rare outside of a business cycle recession. The impact is particularly severe for those with a four-year college degree, reflecting a continued freeze on white-collar job recruitment. Although this group's unemployment rate remains slightly lower than that of lower-educated workers, the historical advantage young college graduates have long held in the job market has disappeared this year. Meanwhile, recruitment rate data presents even more grim signalsthe level of decline has reached historic lows, and based on economic laws over the past few decades, the current level should correspond to a higher unemployment rate. In recent months, there has been an increase in layoff announcements, fueling dissatisfaction among Americans with the job market. Workers outside the healthcare industry are facing difficult situations: excluding that industry, non-farm employment figures in the first 11 months of 2025 have actually decreased. Looking ahead, there are also some positive factors. Michael Puglisi, senior economist at Bank of America, said that the Federal Reserve has cut interest rates this year and is expected to continue to do so in 2026, along with potential tax cuts and relaxations in the Trump administration's trade policy, which should help the uncertainty small businesses have faced this year. However, Puglisi said, "First, the labor market may still be somewhat soft, with the unemployment rate expected to rise by a few tenths of a percentage point." As the balance in the labor market continues to shift from workers to employers, this has already led to a slowdown in wage growth. This is in stark contrast to 2022 and 2023, when workers had the upper hand and employers were forced to offer higher salaries to attract talent. An October Harris poll found that 55% of working Americans are worried about unemployment, and nearly half say they would need at least four months to find a job of similar quality if they were to lose their current job. Multiple wage growth indicators show that wages are currently growing at the slowest pace in four years, with low-income earners experiencing slower wage growth than high-income earners, exacerbating this year's trend of "K-shaped economy", where inequality is widening. This is a risk for Republicans, as part of the reason they won a majority in the last election was widespread anger over rising prices and living costs. As they head into the 2026 election season, the state of the job market may become a new focus. Swonk of PwC said, "Overall wage growth may approach the inflation rate, or may even be slightly higher than overall inflation. But the issue is the distribution of wages." Issue of Black unemployment The growing inequity in employment priorities for hires is becoming more apparent. Over the past few months, the unemployment rate for African Americans in the US has increased significantly, rising from 6% in May to 8.3% in November, with the Black-white unemployment ratio now at its highest level since 2019. Although some of the growth reflects more African Americans entering the workforce, historically, whenever the US job market loses steam, African American workers are disproportionately affected. Measures taken by the Trump administration to reduce the size of the federal government (where African American employees are overrepresented) have added to the challenges African Americans already face in the employment environment this year. Economist Michelle Holder, who studies the performance of African Americans in the labor market, said the risk of further increases in Black unemployment rates in 2026 remains. Holder said, "Even if the overall unemployment rate continues to fluctuate around the 4.6% level, various trends indicate that the consequences of a stagnating economy are increasingly falling heavily on Black workers." Economists say that due to strong consumer spending and robust business investment, they expect GDP to grow by 2% in 2026. However, based on median estimates, recruitment will remain weak next year, with average unemployment rates higher than this year. While respondents say they expect unemployment rates to slightly decrease by the end of 2026, Citigroup economist Veronica Clark warned that if recruitment does not recover, the risk will lean "towards worse outcomes." Clark said, "This is a very prolonged period of low recruitment, and unless this situation changes, you worry that the next step will be larger-scale layoffs."