For a while there, the job market was arguably the most solid part of an uncertain U.S. economy. Employers continued to hire, government officials touted the low unemployment rate, and perhaps most importantly, workers in many industries felt they had options.

But that stability seems to be fading fast.

Revised government data recently revealed May and June were the weakest months for job growth since 2020, and Federal Reserve Chair Jerome Powell is starting to sound warning bells about the risks of rising unemployment.

Americans have also become more pessimistic about new job opportunities, with one measure of their outlook falling sharply in the second quarter. Many workers feel stuck in their current roles and are wary of rocking the boat or looking elsewhere, according to executive search firm Korn Ferry.

“At an alarming rate, more and more employees are displaying what is colloquially known as ‘job hugging’ — holding onto their jobs for dear life,” several Korn Ferry partners wrote in August.

Some people are even struggling with what’s being called “quiet cracking,” where stressors like job insecurity or economic uncertainty are making them really unhappy at work, but they hide it.

So what? The job market is showing cracks, but that doesn’t mean it has to crack you.

For one, there’s a potential silver lining to weaker U.S. job growth. The latest data could justify lowering the Federal Reserve’s benchmark interest rate as early as this month, Powell signaled in August. And over time, a lower interest rate would not only reduce borrowing costs on things like car loans and credit cards, but could encourage businesses to invest and hire.

Plus, even in a tough job market, you have more control than you might think. Here are a few under-the-radar coping strategies if you’re settling for a job you don’t like. (Some apply to job hunters too.)

•  Reach out: If you’re holding it together on the outside, but feel like you’re breaking on the inside, open up — at least a little. Quiet cracking thrives in isolation, psychologist Michelle McQuaid recently wrote in Psychology Today, and even one conversation with a co-worker or friend can help you feel less burdened and break the cycle of silence. You don’t have to fill them in on everything to feel less invisible.

•  Lay the groundwork: Get yourself ready to make a move when the time is right. Reach out to former colleagues, update your LinkedIn profile and resume, take short online bootcamp courses, and update any relevant certifications.

•  Lean into transferable skills: Skills that matter across industries — like project management, communication, and digital savvy — will expand your opportunities when the time comes to find another job.

•  Pick up a side hustle: If your day job doesn’t give you the chance to tap into your passions, try a side gig like freelance writing or photography. Working on something you love can be a great way to reboot (and earn extra income), even if you’re only doing it for an hour after your 9-5. Who knows, you could even turn it into a main hustle. (Check out these side-gig ideas).

•  Prioritize mental rest and moral support: Breaks, hobbies, and reflection can ease the pressure of feeling stuck and refocus your energy. Friends, mentors and industry groups can also offer advice and emotional solidarity during a tough job hunt.

Related Reading

Why Your College Degree Might Not Be Enough in Today’s Economy (Investopedia)

‘Quiet Cracking’ at Work Is Less Visible Than ‘Quiet Quitting,’ but It’s ‘Just as Dangerous,’ Report Finds (CNBC)

The Unemployment Rate Doesn’t Tell the Whole Story (SoFi)

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Borrowed Time

A recent paragraph of a Bloomberg news article sums up the current market backdrop with some sobering stats:

“Treasury yields advanced on Wednesday, with those on benchmark 30-year debt approaching within a whisker of the closely watched 5% level. Yields on UK 30-year bonds increased to 5.75%, already the highest since 1998, while Japan’s 20-year notes climbed to the highest this century.”

Indeed, the yield on a Bloomberg index of global long-term bonds reached its highest level since July 2009. On the surface, the reasons seem clear: Investors are demanding more compensation to hold longer-term debt due to high government spending and inflation risks around the world.

Global 10+ Year Bond Yields

In the U.S. specifically, the rise in long-term yields is happening alongside a drop in short-term (2-year) yields that reflects the market’s expectation for a 25 basis point rate cut at the next Federal Reserve meeting on Sept. 17. As a result, the U.S. yield curve has steadily steepened, with the spread between 2-year and 10-year Treasuries hitting levels not seen since 2022 — the year inflation peaked and stock markets sharply contracted.

2y10y Treasury Yield Spread

Pressure is increasing on government debt levels and investors are “voting with their feet,” so to speak. Moves in yields like this could be warning signs from markets that the balance of risks is becoming unattractive from investors’ perspectives, and needs repricing.

On the Other Hand

There is always another side to the story, however. This year, inflation has plateaued despite widespread fears of reheating. Moreover, measures of inflation expectations have remained contained, which suggests that although inflation is running slightly hotter than the Fed’s 2% target, the economy has digested these levels and gotten comfortable with a new and elevated “normal.”

And if you look at a rise in long-term yields as a representation of rising growth expectations, a steepening yield curve could be an indication of economic strength. Growth has remained steady, and the optimism around AI’s potential to increase productivity has helped boost future growth expectations.

If rising long-term yields were warnings of more ominous things to come, we would also expect to see some sort of confirmation from the credit market, in the form of widening spreads (the difference between yields on corporate bonds and Treasurys), which hasn’t happened.

Credit Spreads

Perhaps this is all the beginning of a repricing to more normalized levels of yields and inflation. I could make that argument and find a decent amount of historical data to support it. We experienced abnormally low levels of yields and inflation for a long time, so maybe time’s up.

Long-Term Stocks

The stock market has its own long-term assets, which typically fall into a growth bucket. These companies tend to invest high amounts now in order to drive future growth prospects, which can often take a long time to materialize.

Over recent weeks, particularly the last five trading days, large-cap technology and tech-adjacent stocks have pulled back. This makes sense in concert with rising long-term yields: As the discount rate rises, the present value of assets dependent on that rate falls.

But this is happening after many of those stocks have seen historic runs and rewarded long-term investors with handsome returns. Valuations are high historically speaking, so perhaps some normalization there is in order as well.

This could be a healthy and necessary normalization process in the midst of an otherwise long-term bull market. It’s good to bring things back down toward earth once in a while.

Or, this could be a warning sign we should heed and make sure we aren’t letting our risk appetites rise along with a rising market. I would argue we all could use a reminder of our appropriate risk levels, and make sure that’s reflected in our current portfolios.

Want more insights from Liz? The Important Part: Investing With Liz Thomas, a podcast from SoFi, takes listeners through today’s top-of-mind themes in investing and breaks them down into digestible and actionable pieces.

SoFi can’t guarantee future financial performance, and past performance is no indication of future success. This information isn’t financial advice. Investment decisions should be based on specific financial needs, goals and risk appetite.

Communication of SoFi Wealth LLC an SEC Registered Investment Adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov. Liz Thomas is a Registered Representative of SoFi Securities and Investment Advisor Representative of SoFi Wealth. Form ADV 2A is available at www.sofi.com/legal/adv.

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