Unemployed Americans Endure Longer Job Searches in a Cooling Market

Recruiters and job seekers at a June job fair in Chicago.

Job seekers are out in the cold this summer. Especially the ones who have been hunting for a while.

Beyond the headline-grabbing top-line numbers in the jobs report for July was another striking piece of data: The number of people unemployed for at least 27 weeks topped 1.8 million, the highest level since 2017, not counting the pandemic’s unemployment surge. The median length of unemployment in the U.S. has also ticked up, from a seasonally adjusted 9.5 weeks in July 2024 to 10.2 weeks last month.

This job-hunting struggle highlights a significant undercurrent in a labor market jolted by tariff uncertainty and cautious businesses. The latest numbers show job growth has been sluggish for months. While the unemployment rate, at 4.2%, remains low by historical standards, companies aren’t hiring much.

Number of people unemployed for at least 27 weeks

The rate of people in jobs or actively looking for work has tumbled to the lowest level since 2022. Economists say lower participation in the labor force is helping to keep the unemployment rate low, but also masking an increasingly dismal climate for job seekers.

Jennifer Smith, 46 years old, says she has applied for 900 jobs since being laid off last September from a financial-services provider in the Tampa, Fla., area, where she led the user-experience department. She has landed just one interview and no offers. This has left Smith, who has three children, increasingly anxious about her finances.

Smith decided this past week to sell her five-bedroom home and trade down to a smaller house. While severance pay has helped, it is about to run out, and Smith has been paying soaring premiums to keep her health insurance.

Jennifer Smith

“I’m just trying to alleviate the financial stress, and hopefully it will help me not feel so hopeless,” she says. “I’m still in shock that all this is happening, to be honest with you.”

Lengthy unemployment spells risk, stunting long-term earnings for individual workers and denting retirement savings. A new generation of graduates are struggling to land jobs and find a foothold on the career ladder, in part because artificial intelligence is taking on more entry-level work. Midcareer workers can stall in current jobs rather than climbing and improving their earnings.

“You start to worry about whether those workers are going to be able to get back into the job market,” says Daniel Zhao, chief economist at Glassdoor.

Owen Skeete

Friday’s jobs report from the Labor Department showed softer than expected hiring in July as well as sharp revisions that slashed the number of jobs created in the prior two months.

Those more than 1.8 million people who have been job hunting for at least 27 weeks now represent a quarter of unemployed people, the report says. A year ago those long-term job seekers were closer to one in five unemployed people. Job openings and hires both ticked down slightly in June, although another recent report showed that layoffs remained at a low level.

Jim Plunkett

The number of “discouraged workers”—or people who have simply stopped looking for a new job—hasn’t changed much from a year ago, Labor Department data shows. At the same time, the pool of people actually in the labor force has dropped substantially, which some economists say reflects the Trump administration’s immigration crackdown.

Some older, out-of-work Americans are wondering if they will find jobs again.

“I’m considering myself semiretired at this point,” says John Comber, 61, a software quality engineer in Sandpoint, Idaho. He hoped to work another decade and thought he would easily pick up more work when his last contract work wrapped up in late 2023. Instead, he estimates he has applied for 500 jobs with no hits.

Sentiment among people looking for work has plunged. Data from LinkedIn shows job seekers are more pessimistic about their ability to find a job than they were in April 2020, when the pandemic was taking off.

With slim pickings, jobs that are available often can be a step down, economists say. Though wage growth for people switching jobs typically eclipses growth for those who stay—reflecting that job hoppers often can negotiate a pay bump—that premium has evaporated this year, according to data from the Federal Reserve Bank of Atlanta.

Owen Skeete, 32, says he spent about a year driving for Lyft to pay his bills after losing his human-resources job in 2023. More recently, he has begun working for his sister’s behavioral-health company, earning about 60% of his previous salary. “It’s basically break-even at this point,” he says.

Jim Plunkett, 54, who lost his fashion-industry job doing production sourcing, says he drained about $25,000 in savings and took out $20,000 in cash advances to pay his bills during a long and difficult job search. He recently took a job installing digital media on brochure racks for half his previous income.

“Is it the greatest time in my life to be starting over?” says Plunkett, who lives in Yonkers, N.Y. “No, but you gotta do what you gotta do sometimes.”

Compensation growth