The Jobs Report, No Chaser
Got to talking with a buddy at the bar the other night. Good engineer, almost twenty years in, laid off back in February. He's put in something like a hundred and forty applications since and he can count the callbacks on one hand. He pulled up the jobs report on his phone, the one everybody's calling the best market in years, and asked me how that's supposed to square with his life.
It doesn't. Not on its face. So we got into it. And the short of it is he's not crazy, the report isn't lying, and both of those are true at the same time. Here's how that works.
The report really was good, on paper. Payrolls came in at 172,000 for May against a forecast of about 80,000, so it didn't just beat the number, it ran it over. Unemployment held at 4.3 percent, and they revised March and April up by 93,000 between them. (Bloomberg, BLS.) On paper, the economy's humming.
But that headline is an average. Hires minus everybody who got let go, all of it mashed into one figure for a country of 340 million people. And an average can lie without ever saying a false word. My buddy and some kid who just picked up shifts at a restaurant down the road are both standing inside that one number, pulling it opposite directions, and on the way to the headline they cancel each other out.
Read the next line of the same report, though. The jobs that got added came from leisure and hospitality, local government, and health care. Finance fell. (CNBC.) He builds software for a living. Nobody's hiring him to pour drinks, so that good number was never really about him.
The number that is about him is in a report almost nobody quotes, called JOLTS. Job openings went up. But hiring dropped by 419,000 in a single month. (CNN.) Think about that. The listings went up and the actual hires went down. Companies are posting jobs and not filling them. The economists have a tidy name for it, low-hire, low-fire. Nobody's getting marched out in a panic, so the unemployment rate stays calm and the headline stays green. But nobody's getting hired either. The rate says everything's fine. His inbox says it's a recession. They're both right, because they're measuring two different things.
And his corner of the world is the worst of it. The layoff rate in the information sector, where a lot of tech sits, almost doubled in a year. Openings there are down 33 percent from a year ago, the steepest drop of any part of the private economy. (Indeed Hiring Lab.) So when he hears "best market in years" and can't get a callback to save his life, that isn't him failing. That's the freeze, doing exactly what the numbers say it's doing.
He asked me straight out if it's the AI taking the jobs.
And here I had to be honest with him, including about what I don't know. Some of it probably is. But "we're getting AI-efficient" is a much nicer thing to tell your investors than "we hired too many people in 2022 when money was cheap and now it isn't." Both of those are true, and both are doing a lot of the cutting. AI's just getting the headline because it's the better story. Can I give him a clean split, this much AI and that much everything else? No. Nobody honestly can right now, and anybody who hands you a confident number is selling something. What I could tell him for sure is that the white-collar work is drying up from both ends at once, fewer openings and more layoffs, and it's been building quietly since 2024.
So we sat there with our beers and I told him the truth. The report isn't a lie. It's an average. And an average of people whose lives are running opposite directions doesn't tell you a damn thing about any one of them. If you're pouring drinks or working a hospital floor right now, that report is good news, and it's telling you the truth. If you're an engineer firing résumés into a hole, it left out the whole part that's about your life.
Same report. Two completely different stories, depending on which stool you're sitting on.
I didn't have a fix for him. I wish I had. The only thing I could give him was the small true stuff. It's not you. You didn't get worse. Four months of quiet isn't a verdict on you, it's the freeze. The number on the TV was never measuring your life in the first place.
I picked up the round. He's still looking, and you don't make a man buy his own beer on a night like that.
Sources, so you can check me:
