Since graduating from college a year ago, Kaitlyn Dwyer has sent out about 500 job applications but so far has come up empty in her search for a full-time position.
Dwyer, who lives in Roanoke, Virginia, has sought jobs as a library assistant, office manager and technical or advertising copywriter, among others. Although she has notched about 45 interviews, she’s typically competing against 100 or so other applicants, many of whom have more experience in the industry.
“It doesn’t matter what sort of (field) you’re trying to get into,” said Dwyer, who earned a creative writing degree from the University of Iowa but previously worked as an office manager for five years. “It’s very, very difficult.”
So instead, Dwyer, 27, is working part-time as a library assistant and living with her parents.
“It’s very disheartening,” she said. “A year is really a long time to not be able to get employment.”
A growing number of Americans who want to work full-time are settling for part-time roles in another sign that a labor market that was sizzling just a couple of years ago has cooled substantially.
“It’s gotten much tougher for job seekers,” said economist Dante DeAntonio of Moody’s Analytics.
How is the job market right now?
On the surface, the job market looks surprisingly sturdy despite still-elevated inflation and interest rates. The unemployment rate was a historically low 4.2% in November and employers added a healthy average of 175,000 jobs a month from September through November and 180,000 the first 11 months of 2024.
Friday, the Labor Department is expected to report a solid 160,000 jobs were added in December and the jobless rate held steady at 4.2%, according to economists surveyed by Bloomberg.
But beneath the shiny figures are hints of distress. In November, there were about 4.5 million part-time workers who preferred full-time jobs, up from 4 million a year earlier, according to the Bureau of Labor Statistics. The ranks of Americans toiling part-time because their hours were cut back and those who could only find part-time jobs both rose by double-digit percentages.
Historically, the tally of so-called involuntary part-time workers is still fairly low and the increase at least partly reflects the labor market’s return to normal after the post-pandemic hiring frenzy known as the “great resignation,” said Brad Hershbein, senior economist at the W.E. Upjohn Institute for Employment Research. Also, the number of involuntary part-timers fell by 373,000 in the most recent three-month period.
What is the involuntary part-time rate?
Yet monthly changes can be volatile. November’s 4.5 million grudging part-timers was more than 200,000 above the pre-COVID-19 average in late 2019. From September through November, an average 2.8% of all employed Americans worked part-time because they couldn’t find full-time jobs, up from 2.7% during the same three months in 2019 – a measure that better accounts for labor force growth.
Dwyer earns $16 an hour and works 12 to 15 hours a week – enough to cover gas, groceries and an occasional dinner out with friends. She added she’s fortunate she lives with her parents and doesn’t face housing and utility costs.
“I would like a full-time job so that, rather than living paycheck to paycheck, I can make enough to have money to put away for emergencies” and rent an apartment, she said.
Dwyer added that she has health issues, and if she got a second part-time job, she would lose her Medicaid payments because her income would exceed the poverty threshold.
What are the signs of a weakening job market?
That’s not the only signal the job market is softening. The number of monthly hires has hovered near the lowest mark since 2016. And in November, more than 23% of jobless workers were unemployed six months or longer, the most since March 2022.
The average number of applicants for a job opening on LinkedIn jumped to 2.5 this past fall from about 1.5 in 2022, the social media site said.
What’s going on?
Why is it so hard to get a job right now?
Businesses are still grappling with hefty labor expenses after they hiked wages in response to post-pandemic worker shortages as well as high borrowing costs due to the Federal Reserve’s sharp interest rate hikes to fight inflation, DeAntonio said. Meanwhile, he said, sales are flat or rising modestly after a post-COVID-19 burst, squeezing company profits.
Also, employers scrambled to bring on so many workers during the labor crunch of 2021 to 2023 that they have less need to hire lots of employees now, Hershbein said.
The recent wave of return-to-office mandates is another factor that could be nudging workers to part-time gigs. Many Americans who can’t find jobs that allow them to work remotely are likely taking part-time positions until they do, Hershbein said.
Are companies still laying people off?
At the same time, consumer spending is still growing, mostly because of higher-income households that are benefitting from big gains in stock and housing values. As a result, companies aren’t laying off many employees, and that’s keeping net monthly job gains growing at a solid pace, DeAntonio and Hershbein said.
The bottom line is a labor market stuck in neutral, with few layoffs but not much hiring.
“If you do get laid off, it’s a challenging hiring environment,” DeAntonio said.
Will the job market get better in 2025?
How the labor market evolves in coming months may depend largely on the policies of President-elect Donald Trump, the economists said. Trump’s planned tax cuts and deregulation could spark a fresh hiring surge. But his import tariffs and the deportations of millions of immigrants without permanent legal status could reignite inflation and hamper economic and job growth.
For now, the uncertainty is another factor suppressing full-time hiring.
Companies won’t add lots of full-time workers if they “don’t know what’s coming down the pike,” Hershbein said. “It can go in a lot of different ways.”
