Why you cannot find a job right now

Someone tell me, someone tell me and explain to me what is going on what’s going on with the job market recently!

Okay.. okay, I’ll do it. As you’ve just seen, to a lot of, especially young people, it feels like it’s really difficult to get a job right now. Sure, Officially the economy is still doing quite fine… and stock markets are still super high… so… what’s going on?

Why is it so difficult to get a job right now? According to a large share of bosses, the reason is simple: “most tasks carried out by entry-level colleagues could be performed by AI.”

But, is that really true? Is the job market really that bad? Is it especially bad for young people? And, is it bad because of A.I. or are bosses just saying that because much less politically risky than blaming Trump’s trade war, or easier than admitting they hired too many people during the pandemic?

That is the question economists have been doing a ton of in depth research about, and, yes, as always, here on Money & Macro, we will spare you the need to read all of that, as we’ve summarized the 3 most important explanations for this video. But, before getting into what exactly they are, let’s have a quick look at the data, are these TikTok folks right?

Is it actually difficult to get a job right now?

The most obvious place to look first is the unemployment rate, that is the percentage of working age people actively looking for a job, but who can’t find one right now. In the US, we can clearly see that indeed unemployment has been rising since the summer of 2022, from about 3.5% to 4.3% in 2025. Meanwhile, in big European economies like the UK and Germany where a job market crisis has been in the news a lot, we can also see that unemployment is already heading back towards levels seen in the pandemic.

What’s really striking though about the labor market today is that we have seen that, despite some really spectacular lay-offs at high-profile companies, the rise in unemployment really does not seem to be driven by so many more lay-offs but rather by a quite spectacular fall in new job postings by companies.

As we can see here, that trend holds for the US, but also for the UK and Germany. However, if we look at whether or not young people in particular are hit the hardest, we can see that in all three countries youth unemployment is quite a bit higher than regular unemployment.

But, if we look at how much it’s risen since 2022, we can see that only in the UK has youth unemployment really risen much faster. In Germany, it’s been pretty close. But, in the US, young workers have done better than average since 2022.

That’s kind of strange given that A.I. was supposed to have taken so many entry level jobs…. So, there’s clearly more going on here. In fact, we’ve identified 3 major trends that can help explain why you can’t find a job anymore. Yes. A.I. is still a factor. But, it’s more subtle than you think. So, let’s get into it. Here’s

1- How the rise of AI is actually impacting the job market

One thing is sure, many businesses ARE already using A.I. and many more are planning to introduce it. In Germany, for example, about 27% of firms are actively using A.I., another 18% is planning to use it, 34% is actively discussing it and only about 21% think it’s just not relevant.

These are very impressive numbers. Just to illustrate how spectacular A.I. adoption percentages are, have a look at this graph comparing personal A.I. adoption to people adopting personal computers in the 1980s or the internet in the 1990s.

This means that … AI is the MOST RAPIDLY ADOPTED technology in human history…

So, actually, it would be quite strange if we did NOT see any effect at all in the labor market. But… just because businesses ARE using A.I…. that by itself does NOT mean that it’s costing jobs. After all, companies could be using A.I. to replace people… but they could also use it to make existing workers more productive.

To find out whether A.I. is getting people fired.. or not hired, Stanford economists Erik Brynjolfsson, Bharat Chandar and Ruyu Chen studied super detailed payroll data from occupations that were especially exposed to new A.I. models like software developers and customer service. As you can see here, early career software developers, who tended to support older coders by doing simple tasks, rapidly disappeared from companies after the launch of Chat GPT (indicated by the vertical line). However, more experience coders kept being hired.

And, as you can see here, the same trend can be seen in customer services. After GPT, young people disappeared from customer service centers, while more experienced workers remained.

Meanwhile, young people in less exposed jobs like stock clerks working in warehouses, and health aids did not see this massive drop in employment.

That’s some pretty solid evidence that A.I. IS impacting jobs, but ONLY in certain sectors AND.. that in these sectors young, less experienced people ARE INDEED hurt more than their more experienced colleagues.

But, of course, just looking at one study is not enough. Another really interesting study was done by economists Hui, Reshef and Zhou. Rather than looking at workers, they looked at freelancer jobs posted on the popular freelance jobs market website Upwork. Specifically, they studied two distinct A.I. waves. First, they researched how text based A.I. models like chatGPT affected writing based freelance jobs like copywriters. Second, they looked at how image models like Midjourney and Dall-E one affected the freelance job market for graphic designers. They found a clear impact. Before the introduction of these models, which is the black vertical line, exposed and non-exposed jobs had a stable relation compared to each other. Then, after A.I. there’s a clear trend showing the number of jobs for exposed jobs decline rapidly, compared to non-exposed jobs.

Combining these two studies, I think there’s clear evidence that A.I. is already leading to SOME job losses, where, given that it mostly affects less experienced people, this could show up as less hiring, making it more difficult to find a job, especially for young people.

Unless… A.I. is creating more jobs than it is destroying. After all, in the past new technologies have obliterated specific jobs very often… but soon after new jobs appeared to replace them. For example, the invention of the printing press decimated the jobs market for scribes. But, at the same time it created jobs like bookbinding, publishing and bookselling. The invention of digital technologies ruined the jobs market for switchboard operators, or so-called human computers, who did complex calculations by hand. But, over time, it created lots of new jobs like programmer, web-developer and data scientist.

So, is that the case today as well? Yes, somewhat.

A recent analysis by researcher Henley Wing Chiu on the US job market, reveals that many of the jobs with the biggest declines where exactly those that A.I. affected most: computer graphics artist, photographer and writer.

On the other hand, the US job seeing the most increases last year was machine learning engineer.

Sadly, his analysis only gives us percentages. It does not show us exactly how many jobs were lost and gained. In fact, I couldn’t find any good research about this. But, if I had to put MY money on it, I’d bet that on we are seeing BOTH effects of A.I. right now. It is making some workers more productive. But, it’s on average also costing more jobs than it is creating. But, I think so far, this effect is limited to sectors like graphic design and writing.

However, as you can see in this graph by the Economic Innovation Group, unemployment for jobs that are super exposed to A.I. like the orange and blue lines is rising … but actually unemployment in less exposed jobs like the green yellow lines is rising as well.

So A.I. can’t fully explain why you can’t find a job right now. To truly get to the bottom of why you can’t find a job right now, we need to talk about a second major global development.

2- Massive policy uncertainty

Of course, this reason is MOSTLY about one man …

That’s right, mr. Trump and his trade war so far has really been characterized by chaos and uncertainty. Have a look at this fascinating graph by the Financial Times, it shows that, on average, Trump’s proposed tariffs have been going up and down like crazy over the year. Meanwhile, actual tariffs have slowly followed.

But, crucially, businesses didn’t know that in advance! It’s well known that, when governments swing between aggressive or unpredictable policies, affected businesses freeze. Firms delay hiring, postpone investments, and wait to see what rules they’ll be operating under next. And yes, we can actually see in the data that uncertainty is unusually high these days.

The so-called Policy Uncertainty Index has exploded over the past year in both Europe and the United States, coinciding with Donald Trump taking office in January 2025.

Could this explain why companies are not hiring anymore all around the world?

Former econ nobel-proze winner Paul Krugman argues that Trump’s wildly erratic policies are creating huge uncertainty which is deterring many companies workers. His main piece of evidence for this is that the number of long-term unemployed has surged since Liberation Day, the moment Trump announced his most dramatic tariff changes.

His second piece of evidence concerns Black workers, whose unemployment rate has climbed sharply in the same period. Historically, Black workers are among the first to be laid off and the last to be rehired — so rising uncertainty tends to hit them especially hard.

But Trump policies have wider impacts that go beyond US borders. For example, Germany’s IFO Institute estimates the German manufacturing sector could shrink by up to 2.8% because of Trump’s trade threats, with the automobile and pharmaceutical industries taking the hardest hits. But, German uncertainty doesn’t come from Trump only, it comes from China as well. Where a massive industrial rise is hitting German industry especially hard.

In less exposed countries, jobs don’t seem to be as much under pressure yet. The Netherlands, France, Spain, in all of these countries a.i. is playing a major role. But. There’s less uncertainty. This could explain why unemployment is not yet rising so much in these countries.

Meanwhile, the UK is also less exposed to the trade war. but, there businesses have indicated they are mostly concerned about uncertainty from it’s new Labour government that is struggling to provide clarity on much it will raise taxes, increase minimum wage, and increase their national insurance contributions.

However, whether it’s about US, China or UK uncertainty, there is one big problem with the uncertainty explanation in general. the timing. If we look at the falling hiring trend over a couple of years, it just doesn’t match up, jobs are decreasing ever since 2022, uncertainty only really became extreme in 2025.

Therefore, to fully understand why it’s so difficult to find a job right now, we need to talk about our final explanation which is

3 The unwinding of the Covid economy

One thing I’m missing in the current media landscape .. and that I hope to address with this channel, is a truly long-term macroeconomic perspective. Yes, as we have seen, unemployment is rising.

But what happens if we zoom out a couple of decades?

Then you get this picture in the US. you get this picture in the UK …. and this picture in Germany

Now, if we draw a line on these graphs, we can see that unemployment is still well under, or in case of the UK, near to its long term historical average.

To me, two things really stand out if we look at these pictures. The first is that unemployment comes and goes in cycles. The second is that unemployment was really EXCEPTIONALLY low right before and after Covid! This was the period of T[he Great Resignation](https://www.jstor.org/stable/48716838), where jobs were so available that people were able to leave abusive bosses or underpaid jobs and move to better paid positions.

That sounds like the way it should be, doesn’t it.

What ended this period. I think the most plausible explanation is the end of high government stimulus, and ultra low interest rates. Governments are worried about debt again and Central banks have increased interest rates. As a result, less money is circulating in most economies and as a result there are not as many jobs.

CONCLUSION

So, to get back to our original questions. Is it really that difficult to find a job right now, especially for young people? Yes absolutely. At least, when you compare it to just 3 years ago.

This can partially be explained by A.I. and geopolitical uncertainty. But, historically speaking, SADLY, it looks like what we we have seen so far is simply a return to normality that can be explained almost completely by the end of COVID stimulus. So, will this situation get better or worse? We can never know FOR sure. On the optimistic side, we have seen in the past that technologies have created many more jobs as well. It took time for these to develop though. So, I do think there is good reason to be hopeful that we haven’t seen many of the more subtle benefits of A.I. yet.

But, honestly, my expectation is that geopolitical uncertainty will only get worse as we enter a multi-polar world order. On top of that, A.I. adoption will likely first lead to more job losses, and with government debt so high and societies quickly ageing, I sadly think it’s unlikely we see much more government stimulus soon.

So, I think it’s unlikely that the job market will get much better soon. But, yeah what do you think? Let me know in the comments below and if you are already making privacy a priority in your life, consider going the extra mile by checking out our sponsor Cape using the link below.