Is the U.S. labor market sliding into its own version of the 1970s? Data shows slower recruiting, stubborn wages and a whiff of “stagflation” that has one economist reaching for historical comparisons.
But before visions of gas lines and double-digit unemployment set in, Andrew Flowers, chief economist at programmatic recruitment marketing firm Appcast, offers a critical caveat: “Mild stagflation does not mean a dire recession.”
In his assessment, Flowers describes a labor market with elevated wage growth and a divide between “standing up” and “sitting down” jobs. These trends, he writes in a recent blog post, may continue or worsen due to policy uncertainty, including immigration restrictions, tariff volatility, Medicaid cuts, threats to Fed independence and the current government shutdown.
“With no signs yet of a major labor market recession or wage-price spike,” Flowers notes, what’s happening is something potentially more vexing for HR leaders: a market that’s cooling without actually loosening.
‘Contrary signals’ in recruiting
Recruiting has downshifted, yet wages remain elevated and labor shortages persist across industries—a combination that leaves talent acquisition teams navigating contradictory signals.
It’s a precarious balancing act. The economic uncertainty makes predictions treacherous, and Flowers argues that staying informed and agile isn’t just good practice—it’s survival. For HR professionals, Flowers warns that “mild stagflation and uncertainty are likely to mean lackluster hiring in 2026.”
HR tech in the news
Workplace culture platform Comparably announced its 2025 workplace awards. Google leaps to the top for Best Perks & Benefits, and Adobe and ADP earned the Happiest Employees nod. Rankings are based on 20 million employee ratings across 70,000 companies.
A new report from Dropbox identifies the top 15% of employees, dubbed “thriving employees,” who excel in both engagement and performance. While 78% of employees report increased productivity when using AI tools, thriving employees take it further. They combine AI with behaviors such as building cross-team relationships and prioritizing deep work.
Deloitte launched Scout, an AI-powered learning assistant that personalizes professional development for U.S. employees. It is designed to streamline enterprise access to learning opportunities, supporting Deloitte’s focus on innovation, agility and building a future-ready workforce.
Globant, a digitally native company specializing in technology, design and innovation, announced a strategic partnership with online learning platform Egg. Together, they launched the AI Talent Shift program to help enterprises adopt AI and upskill their workforce for future competitiveness.
Wellhub has announced that its Corporate Wellness Platform is now available on the SAP Store, integrating with the SAP Extension Suite. The partnership aims to deliver faster setup, automated payroll, smoother onboarding and enterprise-grade security.
More HR tech in the news
International SOS, a global leader in medical and security services, launched Critical Event Management capabilities within its platform. This move aims to help organizations safeguard employees with faster global response support.
Paylocity, a provider of cloud-based HR, finance and IT solutions, announced a five-year partnership with the New York Islanders and UBS Arena. It is now the team’s Official HCM Partner to support operations both on and off the ice.
EY’s multi-year transformation, $1 billion investment in technology and talent and focus on quality have driven audit improvements, AI-powered insights and strong talent pipelines. This news is according to EY’s U.S. 2025 Audit Quality Report.
A new report from digital employee engagement solution Nexthink reveals poor digital employee experience costs global businesses 470,000 hours annually. This highlights digital friction as a significant, often-overlooked factor in the global productivity crisis.
Consulting firm Mercer launched Workforce Insights and Aida, AI-powered HR platforms delivering global benchmarks, dynamic analytics and tailored insights. Designed for HR leaders, these tools aim to enhance data-driven decisions and workforce strategies.
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