2025 was a strange and often frustrating year for hiring.
The AI hype was loud. The data didn’t make sense. And while nearly everyone agreed that the market was off-balance, there was very little agreement on why.
The problem wasn’t a lack of information. It was too much of the wrong kind. The systems people relied on to understand the market were no longer capable of reflecting reality clearly. They stopped telling the truth because they couldn’t. The market was changing faster than they were designed to observe. Behaviorally. Conceptually. And structurally.
Hiring activity moved off the public market. Candidate behavior shifted quietly, too. Decision-making slowed down. AI changed the meaning of work overnight. And the structure of roles evolved in real time.
The whole year was disorienting for many, so before moving into 2026, it’s worth taking a moment to look back at 2025 with fresh eyes to understand what actually happened and where the market stands now.
Spring: Momentum Without Clarity
The year started with a surge of optimism and urgency. AI-dominated conversations almost immediately, and many companies felt pressure to move quickly towards full integration so they wouldn’t get left behind. Systems were being updated. Workflows were redesigned. Teams were experimenting with automation to make processes faster and more efficient. And leaders were watching one another closely because no one wanted to make the wrong move.
But instead of creating clarity and ease right away, AI did the opposite.
It became clear fairly quickly that ChatGPT wasn’t the savior it was initially made out to be. It was powerful and fast, but it lacked human nuance and struggled with context. It could generate language but not always meaning. Everything started to feel hollow, overly polished and increasingly the same. And just as teams felt like they had figured out the right prompts, the models shifted again.
By the end of Q1, momentum hadn’t disappeared, but confidence in direction had. Leaders began to slow down, reassess and wait. Larger initiatives softened and hiring followed suit, not because work stopped, but because it was no longer clear what plans were solid or what roles were actually needed.
Summer: A Market in a Holding Pattern
By summer, the hiring market had all but entirely pressed pause. On paper, the economy was stable, not strong but stable, and yet nothing was moving.
There were pockets of activity in certain industries, but in general, most companies weren’t hiring aggressively or reducing headcount either. Q2 was several long months of slow hiring, slow firing and almost no quitting, while candidates grew frustrated by ghost postings, long hiring cycles, and an application process that felt dehumanized, demoralizing and unwinnable.
At the same time, the top performers quietly stepped away from job boards causing the talent pool to divide. The visible candidate pool grew larger and louder, while experienced, in-demand talent became harder to reach. As a result, headhunting and direct outreach saw a surge in popularity as the smartest and most effective way to hire.
Early Fall: Two Versions of the Market
By early fall, the market still wasn’t providing clear signals, but waiting had gone on for too long. Leaders weren’t reacting to headlines or forecasts anymore. They were responding to real internal consequences of their business standing still.
Projects had been paused for too long. Teams were burning out. Strong performers were disengaging. What had once felt like a cautious pause started to feel uncomfortably risky.
The market had reached a point of inflection, and leaders finally had to decide which direction they believed it was headed. That’s when it became clear the data wasn’t going to help anyone predict what came next. There were two versions of the market happening at the same time, and leaders had to make a move based on what they believed and what they were seeing inside their own businesses.
Winter: The Data Went Dark But Hiring Didn’t Stop
By the end of the year, official labor data became delayed or unavailable due to the government shutdown. The reports many leaders had been trying to discern simply stopped.
But hiring didn’t.
Activity continued, mostly off the public market. Roles were filled through direct outreach, internal movement, contract support, and quiet searches and the absence of data made something clear that had been building all year — a meaningful portion of hiring activity was never fully visible in national reports to begin with.
It was off-market.
And now at year’s end, the expectations around AI have cooled. Companies are now more realistic about what automation can and can’t solve. And in a hiring market overwhelmed by automation, and growing fraud, human intelligence has become more valuable, and not less.
That’s the real takeaway from 2025. Data and AI are tools. Useful ones. But neither tell the whole story. And neither can replace leadership, context or human decision-making when it comes to hiring.
Thinking about what hiring in 2026 is going to look like? We think we have a clue. Check out Hiring for What Actually Matters in 2026 to see what you should be looking for in candidates.