The job market's Great Freeze could break in 2026. The question is whether job seekers get relief or disaster.

"The frozen job market could be heading into "a moment of reckoning" this year, said Claudia Sahm, the chief economist of New Century Advisors."

"We really slow down in terms of hiring, and we hit a place where the bottom falls out. And it's not just about slow hiring, it's about firing workers and a recession."

"The uncertainty lifts, they're ready to pick up hiring, and you see things really stabilize and kind of look more like a labor market that we've been more used to in terms of the job opportunities and adding workers."

The job market entered a low-hire, low-fire freeze driven by economic uncertainty and employer caution. Employers hold hiring back while weighing factors such as tariffs and future conditions. Two divergent paths could unfold in 2026: one where hiring slows further, layoffs increase, and a recession ensues; another where uncertainty lifts, employers resume hiring, and labor-market conditions stabilize with more job opportunities. Persistent retirements and attrition will force eventual replacement hiring. Increased layoffs would intensify competition for unemployed workers, while broad hiring with low layoffs would improve prospects for job seekers and waiting employees.

Read at Business Insider