Is the Job Market Really that Bad? Yes, and it may take Years to Recover.

TL;DR

• The job market in 2026 feels brutal, but the traditional methods we’d use to assess it objectively don’t hold.
• Many job seekers have stopped applying, so they’re not counted.
• Underemployment is rampant — especially for new grads and white-collar workers.
• AI-driven competition and role replacement often means hundreds of applicants per remaining role.
• If historical data holds, we’re looking at another 5-69 months before the job market starts to feel normal again.

Well, sort of. More than that, this job market is different. Still it’s helpful to look at history for benchmarks and to estimate how long before we might see things improve. Unfortunately, multiple past economic downturns, from the 1980s to today, show job recoveries take years, not months. Traditionally we’d look at recessions, measured by GDP, as a backdrop against which to view the the job market. For strength of the job market itself, we’d usually assess it by unemployment rate. Here’s what those numbers look like:

• The 1980s double-dip recession saw unemployment at 10.8% in late 1982 and the unemployment rate didn’t drop to previous levels, 7.2%, until June 1984, 35 months later.
• The 1990–1991 recession peaked at 7.8% unemployment in June 1992; unemployment levels didn’t return to their pre-recession levels until February 1995, 56 months later.
• The Great Recession (2007–2009) saw unemployment falling to pre-recession levels in September 2015 (93 months).
• The COVID downturn was faster — just 29 months — but that was an exception, not the rule. And one can argue we’re still feeling its effects.
• As somewhat of an aside, unemployment touched a low of 3.8% in April 2000 just before the doctom bubble recession, and took until February 2019 to return to those levels. That’s just shy of 19 years. Shout-out to my Millennial peers here. We really did get screwed…but, onward!

In short, because unemployment percentages don’t tell the full story. Todays’ unemployment rate is around 4%. That should feel good, but to anyone looking for a job, that’s little consolation and honestly sometimes feels a little insulting. Here are five other factors to keep in mind.

1. People who stop applying aren’t counted, and Gen Z is fed up with the system. More are disengaging than we saw in prior generations.
2. Underemployment is widespread. Side hustle culture can be great. In fact, we’ll go so far as to even say we like it, but it’s different if you’re just trying to make ends meet.
3. Hiring has slowed and competition is up. Lots of things effect competition, but globalization and higher immigration both mean more qualified individuals for each job. Companies also have to adapt to price pressures from outsourcing.
4. AI tools increase the number of applications per job in an entirely new manner. While it’s a beautiful and fascinating thing, AI does require today’s applicants to adapt just to keep up.
5. Wages haven’t kept up with inflation. While not strictly a new phenomenon, this fact has led to many Gen Zers feeling apathetic towards the job grind, leading to point #1 above.

Going by the numbers above, it could be anywhere from early 2026 to mid-2031 before we see the job market normalize. In my humble opinion, things will also simply change. Millennials (paywall) birthed the current side hustle culture, and Gen Z is well-known for making their mark in this sphere with social media. Gen Alpha has started working side hustles early and will likely overtake both Millennials and Gen Z in both number and impact. All that to say, the traditional job market is changing. However, to have a side hustle, one by definition needs a main hustle.

The job market may be slow, but that doesn’t mean you have to be. The truth is, people do get hired in tough economies; especially those who have the right tools and a smart strategy. That’s where we come in. Whether you prefer to learn on your own through a guide or on our other blog articles, we can help you succeed.

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