One in Five US Firms Plans Hiring Freeze

A growing number of American companies plan to slow hiring in the latter half of this year.

Twenty percent of employers say they’ll bring on fewer workers this year, The Wall Street Journal reported Thursday (Aug. 21), citing data from The Conference Board. That figure is almost twice the rate of companies that planned to slow hiring at this point in 2024.

According to the report, the last time the survey found optimism among executives about hiring was the second quarter of 2023. Enthusiasm has fallen steadily since then, the WSJ adds, noting a series of hiring pauses, including one at Meta’s AI team.

Companies are “taking a more thoughtful, steady approach as economic and policy uncertainty lingers,” Diana Scott, leader of The Conference Board’s U.S. Human Capital Center, told the news outlet.

She added that the slowdown is a sign of companies trying to do more with their existing staffing rather than making the major hiring moves they did several years ago.

The report argues that a “perfect storm” of changes is making executives cautious, including tariffs and workplace raids in industries that depend on immigrant labor. And companies continue to turn toward artificial intelligence (AI) to boost productivity and efficiency.

The Conference Board’s CHRO Confidence Index for hiring expectations came to 54 in the second quarter, down from 59 in the same period last year.

According to the report, it now takes the average worker 24 weeks to find new employment after losing their job, compared to five months in 2024. Last month’s jobs report showed a sharp slowdown in hiring, while the number of long-term unemployed has been creeping up.

Meanwhile, American workers continue to face financial fragility, according to recent PYMNTS Intelligence research.

The Paycheck-to-Paycheck Index came to a new high of 68.4% in May, showing that 684 out of every 1,000 Americans are spending their monthly income on essential expenses. In addition, nearly 1 in 4 Americans say they struggled to stay on top of their bills — a figure that has climbed up for each of the previous three months.

“This environment fosters discomfort, as 6 in 10 consumers feel uneasy when contemplating their finances, and 24% admit to high anxiety, alongside 36% expressing some level of concern,” PYMNTS wrote last month.

“While lower-income individuals predictably bear the brunt of this stress at 71%, even a portion of middle and high earners report worry, demonstrating a broad-based financial apprehension that transcends income brackets and generally impacts all age groups, with baby boomers being a slight exception.”