The Job Market Is Even Worse Than We Thought

For the first time since 2021, there are now more people searching for work than there are job openings. So not a very promising outlook for the rest of the year and moving into 2026. But here's the first interesting thing. Even though the hiring has been slowing down dramatically, economists are saying that we are not in a full-out job market collapse. And the reason is because of the supply of workers is shrinking. At the same time, demand for jobs is cooling. That means that fewer jobs are needed each month to keep the unemployment rate from rising. So essentially, they're saying because there's less people looking for work and there's fewer jobs being created, it's not as big of a problem because if there was more people looking for work and we had the fewer jobs being created, then that would be an even bigger problem. Which I agree, it would be a bigger problem, but it's also no justification of why things are good right now, at least in my opinion. So what they're referring to is the break even point for the job market. Because back in 2023, the US needed to gain 125,000 new jobs every month just to keep unemployment steady. But in 2025, they're claiming that the break even point has now fallen to around 60,000 jobs per month. And some estimates say it could be as low as 32,000 jobs per month. And the reason why I think this is a big problem is because of the way that they count unemployment to begin with. Because don't forget, you are not counted as unemployed if you've been out of work for longer than six months. Once you fall off the unemployment system and you're no longer collecting benefits, you're no longer counted as unemployed. So how can you say that this is a good thing, that there's fewer people looking for work and there's less job openings, so therefore things might not be as bad as it looks? Well, it just means that those people have been out of work for so long that they don't count anymore. We've seen countless stories of people who've been out of work for 12 months, 14 months, 18 months, even longer in some cases, that had really good jobs prior to that and can no longer find work. And these were six-figure white-collar earners that are now struggling and doing doordash and grubhub just to get by. By the way, this is my first beach video all year here in California. And I was just at Stinson Beach yesterday and it was nice and sunny. It probably is over there because the problem is this area is like too close to the Golden Gate, so it gets all this fog. But anyways, I haven't done a beach video or walked on the beach with you guys since I was in Miami, so hope you enjoy it. So they're saying we're only going to run into a really dangerous situation is if the economy continues to create less than the 60 to 30,000 jobs per month that's estimated to keep unemployment from rising even further. You know, for example, August we only saw 22,000 jobs added and the unemployment rate went from 4.2 to 4.3 percent. But the reality is the unemployment rate's probably hovering over 10 percent if it were counted properly. You know, if everybody who's truly looking for work or even if we go by the functional unemployment, unemployment should be at 24 percent, guys. People who are earning poverty wages. People who have been out of work for six months or longer. Those unemployment figures would be much, much higher. So once again, I feel like the media just tries to spin this. And the economists too, right? Because this comes from economists. They're the ones saying that this isn't so bad because of the job market break-even point. You know, they're like making excuses of why it's not that bad instead of just facing the reality and saying the things that I'm saying and saying, you know what? We should be counting unemployed people who have been out of work for a long time. We should be counting people making poverty wages as unemployed because it's as if they are unemployed. So they say there's a number of reasons why the labor force is shrinking right now. You have a lot of people who are retiring. Obviously, the baby boomer generation, largest generation who have been rapidly retiring for good. You have the immigration slowdown. We had three and a half to four million people pour into this country in 2023. And so far in 2025, it's only been half a million. They say that like it's a bad thing. Then there's been the deportations, which they say they've been deporting about 3,000 people a day. And that could cut the labor force by about one million additional people in 2025. And then of course, the illegal border crossings are way down. All this stuff they say as if it's like a bad thing. You know, these are good things. We're finally enforcing some of the rules we have in this country. So funny enough, because we've been creating so few jobs, and coincidentally, we have a shrinking labor supply right now. We have less people looking for work. It's actually the only thing that's making unemployment not look so bad. But the economists are spinning this as a way as maybe the economy is not that bad, but the reality is it's just a lot of different bad things happening all at once that almost cancel each other out. That's how I view it. The economists do at least acknowledge and say that unemployment could be at the 5% mark already if the labor supply hadn't fallen in tandem. And right now, a small round of layoffs is going to have a much larger impact than it did a couple of years ago. So any mass layoff announcements we see from here on out moving forward is going to have a much larger impact on this official unemployment number, according to this. Now, by the time I release this video, the Federal Reserve could already be cutting interest rates, which they're predicted to do on Wednesday this week, which is when this video is going to come out. And if they do, a lot of people are hoping that this is going to prevent the country from spiraling even deeper into an economic downturn, which is what the rate cuts are kind of designed to do. But the problem is these rate cuts alone are not going to solve these problems that we have in this country. Everybody thinks that the rate cuts are going to come in and just save the day and it's going to cause all these companies to just go on a hiring streak and bring a bunch of people back. But that's not how it's going to go. Dropping interest rates a quarter point or even half a point is going to do practically nothing for the job market or the housing market, for that matter. That's my prediction. I don't see any meaningful moves happening in any of these sectors of the economy. I could be wrong, but, you know, we saw rate cuts already last year coming into 2025, and that didn't do anything besides actually make things worse. Now inflation is going back up. Now the job market's in an even worse spot than it was a year ago. The housing market isn't in no better shape either.