The entry-level worker would be forgiven, in other words, for feeling about the job search the way Kutcher and Scott feel about their stolen wheels. (The screenwriter feels similarly about the show-business labor market, telling The Hollywood Reporter<\/a> several weeks ago that he\u2019d quit to become a therapist.)<\/p>\n \u200b\u201dThe job market has been weak this year,\u201d wrote BofA\u2019s Yuri Seliger and Sohyun Marie Lee, commenting on the double payrolls report<\/a> showing weak job growth in October and November. \u201cA lack of recovery in the jobs market and a slower U.S. economy are key risks to watch for 2026.\u201d<\/p>\n Seliger and Lee flagged what it called the weakest U.S. job market since at least 2011 (with the notable exception of the mass layoff wave from Covid), with monthly payrolls averaging just 17,000 over the past six months\u2014by far the slowest pace of job creation since the global financial crisis. Private payrolls are only modestly stronger at 44,000 on a six\u2011month average basis, still at their weakest level in well over a decade, while broader U\u20116 underemployment has climbed to 8.7% and job openings per unemployed worker have slumped to 1.0, both the softest since 2017.<\/p>\n \u200bYet the Situation Room team also noted that credit spreads remain near cyclical tights and stocks near record highs, signaling that investors are still betting on a strong expansion in 2026. \u201cA strong U.S. economy is likely not compatible with the absence of job growth,\u201d they caution, warning that the lack of a labor\u2011market recovery is now one of the central risks to that bullish market narrative. The surprisingly strong GDP number\u200b for the third quarter, revealed after the BofA note was written, added new fuel to the fires of this argument.<\/p>\n K\u2011shaped growth with missing jobs<\/p>\n The headline growth number was eye\u2011catching: in the third quarter, U.S. GDP grew at a 4.3% annual rate<\/a>, powered by a consumer spending surge and a $166 billion jump in corporate profits. But real disposable income was flat\u2014literally 0% growth\u2014meaning households did not gain purchasing power and instead relied on savings, credit, and cost\u2011cutting to keep spending, especially on unavoidable items like healthcare and childcare.\u200b<\/p>\n KPMG<\/a> Chief Economist Diane Swonk previously described this to Fortune<\/a> as a fully matured\u00a0K\u2011shaped\u00a0economy, where affluent households ride surging equity markets, elevated home values, and AI\u2011boosted corporate earnings, while lower\u2011 and middle\u2011income families are squeezed by affordability pressures and stagnant real income. <\/p>\n Businesses, she argued, have learned how to grow without hiring, squeezing more output from lean teams rather than expanding payrolls to meet demand\u2014a pattern that aligns with BofA\u2019s evidence of historically weak payroll gains in an otherwise solid macro backdrop. \u201cWe are seeing most of the productivity gains we\u2019re seeing right now as really just the residual of companies being hesitant to hire and doing more with less,\u201d Swonk told Fortune. \u201cNot necessarily AI yet.\u201d<\/p>\n Her analysis aligned with what BofA\u2019s Savita Subramanian told Fortune<\/a> in August about a \u201csea change\u201d in worker productivity, as companies replaced people with process. Companies had learned how to \u201cto do more with\u00a0fewer\u00a0people\u201d after the inflation that followed the pandemic, and she predicted this will be a positive for stocks: \u201cA process is almost free and it\u2019s replicable for eternity.\u201d <\/p>\n Goldman\u2019s \u2018jobless growth\u2019 and Gen Z<\/p>\n More darkly, Goldman Sachs economists warned about the prospect of \u201cjobless growth,\u201d echoing Fed Chair Jerome Powell\u2019s description of a \u201clow-hire, low-fire\u201d labor market. In an October note<\/a>, Goldman economists David Mericle and Pierfrancesco Mei found that outside of healthcare, net job creation turned weak, zero, or negative in many sectors even as output keeps rising, with executives increasingly focused on using AI to reduce labor costs\u2014a \u201cpotentially long\u2011lasting headwind to labor demand.\u201d \u200b<\/p>\n They argued that the modest job gains alongside robust GDP seen recently are \u201clikely to be normal to some degree in the years ahead,\u201d with most growth coming from productivity\u2014especially AI\u2014while aging demographics and lower immigration limit labor\u2011supply contributions. <\/p>\n Apollo\u2019s Torsten Slok pointed out in a December note that demographic change is now becoming visible: the number of families with children under 18 peaked at around 37 million in 2007 and has declined to approximately 33 million as of 2024, reflecting lower birth rates and an aging population, despite overall population growth continuing.<\/p>\n A fragile equilibrium<\/p>\n Both BofA and Goldman stop short of predicting mass unemployment, but neither sees an easy path back to the old playbook where strong GDP reliably meant plentiful new jobs. Still, Goldman sees a larger shakeout for the economy: \u201cHistory also suggests that the full consequences of AI for the labor market might not become apparent until a recession hits,\u201d Mericle and Mei wrote in October.\u200b<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/12\/bofa_3d85d8.png\"\/)
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