Nice read. Really helpful framing with the “no-hire” equilibrium because it matches what I’m hearing anecdotally (few layoffs, but hiring pipelines frozen). Curious what indicator you’d watch as the earliest sign it’s thawing: JOLTS hires rate, temp staffing stabilization, quit rate, or something like small biz hiring intentions?
I'm incredibly thankful to have a job. I remember the anxiety of not being able to land anything, so I really feel for the under 25 crowd applying to hundreds of jobs and getting zero hits.
Small businesses, less than 25 people account for +70% of the jobs in the US, and businesses with 1-5 employees are 40% of the jobs. These are the businesses hardest hit by tariffs, health insurance costs, rising cost of living and loss of immigrant labor. The slowdown in hiring and rise in bankruptcies are concentrated in these businesses. And they often don't get invited to an inauguration.
Awesome read. I'm curious what do you think it would take for the labor markets to start picking up again and do you think a weak labor market will start showing itself up in capital markets this year?
I just both simultaneously graduated college and got laid off (by a company that I acquired an internship at and got hired full time) and now i can't find anything over one month in. What was the point of going to college, then??!!!
Because nobody took out their calculator, said that if a 4 year private college degree ALL IN costs $400,000 and instead you invested that in SPY and assumed SPY would return 10% for 50 years, same as last 50 years, you would have $46mm in your account
Has the current administration been better for white men? Weekly real earnings of white men employed full-time surged during Covid, fell during the inflation boom, recovered in 2024 ... and have flat-lined in the past year.
The composition of the freeze may be more important than the aggregate. The data here suggests the slowdown is concentrated at the entry-level pipeline and at the lateral-move tier, which together compose most of the mechanism by which firms grow internal seniority. A firm can hold its headcount steady for years while quietly losing the way that headcount renews itself. By the time the next expansion cycle arrives, the bench isn't there. The hiring numbers start looking healthy again, but the underlying capacity to absorb a normal labor market has changed shape. Curious whether the JOLTS or BLS data lets you separate the freeze from the demographic shift in who is even available to be hired at the senior tier.
My one thought regarding government employment falling is, it is a great thing. we have $38 trillion in debt and far too many Federal employees. it seems that reductions there will have the benefit of reducing spending and, pretty much whatever else a government employee does elsewhere will increase overall productivity
This probably costs money instead of saving it. For example, a job that used to have a full time employee might now be outsourced to a less competent, more expensive contractor.
What matters is the functions that the federal government performs, not the headcount.
One thing that’s interesting in this context is inflation dynamics themselves aren’t really linear over time : looking at long-term data and most of the cumulative increase in prices comes from a few short episodes often tied to shocks more than gradual labor market pressure. That creates this disconnect where labor markets can cool but the inflation still moves in bursts.
Hang on! Wasn't Trump going to fix this? He wouldn't have lied to me would he?
Nice read. Really helpful framing with the “no-hire” equilibrium because it matches what I’m hearing anecdotally (few layoffs, but hiring pipelines frozen). Curious what indicator you’d watch as the earliest sign it’s thawing: JOLTS hires rate, temp staffing stabilization, quit rate, or something like small biz hiring intentions?
I'm incredibly thankful to have a job. I remember the anxiety of not being able to land anything, so I really feel for the under 25 crowd applying to hundreds of jobs and getting zero hits.
This is grim.
Small businesses, less than 25 people account for +70% of the jobs in the US, and businesses with 1-5 employees are 40% of the jobs. These are the businesses hardest hit by tariffs, health insurance costs, rising cost of living and loss of immigrant labor. The slowdown in hiring and rise in bankruptcies are concentrated in these businesses. And they often don't get invited to an inauguration.
Awesome read. I'm curious what do you think it would take for the labor markets to start picking up again and do you think a weak labor market will start showing itself up in capital markets this year?
I just both simultaneously graduated college and got laid off (by a company that I acquired an internship at and got hired full time) and now i can't find anything over one month in. What was the point of going to college, then??!!!
Because nobody took out their calculator, said that if a 4 year private college degree ALL IN costs $400,000 and instead you invested that in SPY and assumed SPY would return 10% for 50 years, same as last 50 years, you would have $46mm in your account
How do we square this with >5% GDP growth?
Has the current administration been better for white men? Weekly real earnings of white men employed full-time surged during Covid, fell during the inflation boom, recovered in 2024 ... and have flat-lined in the past year.
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The composition of the freeze may be more important than the aggregate. The data here suggests the slowdown is concentrated at the entry-level pipeline and at the lateral-move tier, which together compose most of the mechanism by which firms grow internal seniority. A firm can hold its headcount steady for years while quietly losing the way that headcount renews itself. By the time the next expansion cycle arrives, the bench isn't there. The hiring numbers start looking healthy again, but the underlying capacity to absorb a normal labor market has changed shape. Curious whether the JOLTS or BLS data lets you separate the freeze from the demographic shift in who is even available to be hired at the senior tier.
Where are you seeing a contractionary fiscal policy? The US federal primary deficit is near record levels (excluding during recessions), and is about 70% higher than it was in 2019. https://www.stlouisfed.org/on-the-economy/2026/feb/look-recent-developments-federal-fiscal-balance
A more likely problem, in addition to uncertainty around AI is policy chaos, particularly, but not only around tariffs.
My one thought regarding government employment falling is, it is a great thing. we have $38 trillion in debt and far too many Federal employees. it seems that reductions there will have the benefit of reducing spending and, pretty much whatever else a government employee does elsewhere will increase overall productivity
This probably costs money instead of saving it. For example, a job that used to have a full time employee might now be outsourced to a less competent, more expensive contractor.
What matters is the functions that the federal government performs, not the headcount.
My implication was that the federal government should do half as much as it currently does
Fair enough but I don't think DOGE reduced the government's functions, only its headcount.
The best way to survive in 2026:
It’s to do what AI can’t. Ask a novel question.
A 'no hire' economy sounds like great news until you remember someone still has to do the hiring, and it's apparently not anyone.
📌📌📌
One thing that’s interesting in this context is inflation dynamics themselves aren’t really linear over time : looking at long-term data and most of the cumulative increase in prices comes from a few short episodes often tied to shocks more than gradual labor market pressure. That creates this disconnect where labor markets can cool but the inflation still moves in bursts.
Adding a dataset and chart breakdown on this pattern if useful
https://eco3min.fr/en/us-inflation-is-not-linear/