Job hugging is the new job hopping
Job-hugging is a new form of job-hopping due to the slowdown in the labor market.
U.S. employers added 130,000 jobs in January, the Bureau of Labor Statistics said on Feb. 11, but the bureau’s revisions to previous monthly data show the labor market in 2024 and 2025 was weaker than previously expected.
Job growth in January exceeded forecasters’ expectations, as employers added more than twice as many jobs as in December. The unemployment rate fell to 4.3% after falling from 4.6% in November to 4.4% in December. The report’s release, originally scheduled for Feb. 6 but delayed by the brief government shutdown, follows several others that have reignited concerns about the labor market still adjusting to tariffs, immigration crackdowns limiting the supply of workers and employers’ adoption of artificial intelligence.
Ahead of the report’s release, National Economic Council Director Kevin Hassett told CNBC on February 9 that people should expect “a modest decline in payrolls,” which he said could reflect “increased productivity” and “a significant reduction in the workforce.”
“There’s no need to panic if we continue to see lower numbers than we’re used to seeing, because, again, population growth is falling and productivity growth is soaring,” Hassett said. “This is an unusual situation.”
After the January numbers were released, Seema Shah, chief global strategist at Principal Asset Management, said Hassett’s warning “seems unnecessary”.
“This was not a weak print. It was a very strong print, even considering the considerable noise that may have been in the data,” Shah said in a statement to USA TODAY.
What does the revision reveal?
Job seekers who felt the labor market was worse than economists say from April 2024 to March 2025 may feel vindicated by the BLS’s annual revision, which revealed that the U.S. economy added 898,000 fewer jobs during that period than previously reported.
“That’s a big swing…you’re not losing almost 900,000 jobs that you thought you had,” said Mike Scordeles, head of U.S. economics at Trust. “But if you look at the monthly numbers, most of the trends have remained pretty much the same.”
Mr. Scorderes told economists that the revisions are less of a problem because they recognize that the BLS’s monthly reports are estimates and track other indicators to inform the outlook.
“But I think for an amateur or an average business owner, when they look at that, they’re like, ‘I don’t know the ins and outs,'” he added.
Downgrades are based on state unemployment records, which reflect actual salaries, rather than monthly government surveys. Annual revision is a standard BLS procedure that helps correct sampling and modeling errors. It also serves as a reminder that the agency’s monthly employment report is based on estimates and sample surveys and is not a complete survey of U.S. employers.
BLS also released regular revisions for the past two months. These indicate that the labor market at the end of 2025 was even weaker than previously expected. The December salary increase was revised downward by 2,000 people, and the November salary increase was revised downward by 15,000 people.
Which industries are hiring?
Health care employment again led payroll growth in January, adding 82,000 jobs. The social assistance sector increased by 42,000 people, and the construction sector by 33,000.
After a year marked by mass layoffs, the federal government is cutting jobs again, cutting 34,000 jobs in January as some workers who accepted deferred retirement offers last year had their pay cut. Employment in financial activities decreased by 22,000.
The BLS said there was little change in employment in other industries, including manufacturing, wholesale and retail trade, and hospitality.
What about the overall job market?
The BLS reported that in December there were 7.5 million unemployed people and 6.5 million job openings, meaning there were nearly 1 million more potential job seekers than available jobs. Applications for unemployment benefits are rising, and employers announced 108,435 layoffs in January, the most in the first month of the year since 2009, according to the Feb. 5 Challenger, Gray & Christmas report.
In 2025, economists have described the labor market as a “low-hiring, low-firing” environment as some U.S. workers hang on to their jobs for fear of having a hard time finding a new job. That sense of caution manifested unevenly across the industry. Job seekers in the medical field may have been able to find work, but opportunities were more limited in other fields.
Jeff Bonci, president of accounting and finance staffing at The Planet Group, said the hiring slowdown reflects “issues of timing and prudence.”
“Many companies paused hiring decisions late in the fourth quarter and continued that conservative stance into January, awaiting final budget, interest rate transparency and economic signals,” Bonci said in a statement to USA TODAY. “Looking to the future, we expect hiring activity to pick up as budgets are freed up and companies move towards targeted skills-based hiring rather than large-scale headcount expansion.”
Will the Fed cut rates in March?
Concerns about the job market prompted the Fed to cut interest rates three times late last year, but policymakers opted to keep rates unchanged at their most recent meeting on Jan. 28.
Explaining the decision, Chairman Jerome Powell said that although job growth remains low, the unemployment rate is showing “signs of stabilization” and the outlook for economic activity is improving. But he added that it was a “difficult time” to read the job market as both labor participation and demand were softening.
Rate-setting committee members Stephen Millan and Christopher Waller opposed January’s decision and wanted rates to be cut by another quarter of a percentage point. Waller said he expects the revised data will reveal “substantially no growth” in salaried employment last year.
“Zero, zip, nada. Let’s think about this for a moment: zero job growth compared to an average of around 2 million jobs over the 10 years to 2025. This does not seem like a healthy labor market by any means,” Waller said in a statement, adding that layoffs planned for 2026 create a significant risk of a “significant deterioration” in the labor market this year.
As of February 11, a majority of Fed watchers expect policymakers to keep interest rates on hold at their next meeting in March.
This story has been updated to add new information.
Contact Rachel Barber rbarber@usatoday.com X Follow her at @rachelbarber_
