What is the story about?
Just a few years ago, the American workforce was in the midst of seismic shift. The pandemic-era “Great Resignation” saw millions of workers voluntarily quit their jobs in search of higher pay, better working conditions, and
more flexible arrangements.
In 2021 alone, around 47 million people resigned, and that number rose to 50 million in 2022. It was a period marked by confidence in mobility, with employees feeling that opportunities were plentiful and attainable.
That cycle has now reversed.
Today, US employees are less likely to change jobs, and labour economists say a new trend has emerged: “job hugging.”
The phrase, coined by Korn Ferry consultants earlier this month,describes workers clinging tightly to their
current roles — sometimes described as holding onto them “for dear life” — out of uncertainty about what lies beyond.
The US Department of Labour’s Job Openings and Labour Turnover Survey shows the national quits rate has hovered near 2 per cent throughout 2025.
With the exception of the early months of the pandemic, such consistently low voluntary exits have not been observed since 2016. Unlike the dynamic environment of just a few years ago, today’s labour market has slowed to a crawl, with both hiring and departures subdued.
The reasons for this shift are rooted in both macroeconomic conditions and individual worker perceptions. Rising borrowing costs, driven by high interest rates, have cooled business expansion.
Employers are not hiring at the same pace they once did, and job seekers have fewer positions to choose from.
Payroll data showcases this slowdown: in July 2025, the US economy added only 73,000 jobs, a sharp drop compared to the earlier monthly average of 111,000.
Over the previous three months, average job growth slumped to just 35,000.
The ratio of job openings to unemployed workers has also narrowed significantly. In March 2022, there were roughly two openings for every person seeking work.
By June 2025, the ratio had fallen to nearly one-to-one, showing how much tighter the market has become.
This environment has changed worker attitudes. According to quarterly surveys by ZipRecruiter, 38 per cent of respondents in mid-2025 said they were “not confident at all”
that there were “plenty of jobs” available.
Just three years earlier, only 26 per cent shared that sentiment.
Laura Ullrich, director of economic research for North America at the Indeed Hiring Lab, said this caution reflects the broader climate.
“There is this stagnation in the labour market, where the hires, quits and layoff rates are low. There’s just not a lot of movement at all,” she told CNBC.
Korn Ferry executive consultant Matt Bohn put it more bluntly: “There’s quite a bit of uncertainty in the world —
economic, political, global — and I think uncertainty causes people to naturally remain in a holding pattern.”
He compared the current mindset of employees to that of investors who prefer to sit on the sidelines until the time is right to act.
The Eagle Hill Consulting Retention Index, which measures employee intent to remain in current roles, has shown steady increases since late 2024.
Employees report plans to stay put over the next six months,
even if they are dissatisfied.
Meanwhile, the firm’s Market Opportunity Indicator — which tracks how workers perceive outside job prospects — recorded a 4.4-point decline in the last quarter of 2024, reaching its lowest level since the measure was introduced in 2023.
At the executive level, these dynamics are particularly visible. Stacy DeCesaro, a Korn Ferry managing consultant specialising in sales and marketing leadership, noted, “Right now, top performers are only leaving if they’re miserable in their roles.”
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Recruiters, she said, are finding it difficult to persuade high-performing executives to consider new offers unless compensation packages are exceptionally attractive.
This stagnation in movement has made recruiting across industries more challenging. It is not limited to rank-and-file employees but extends to management and senior leadership.
At the same time, CEO turnover has accelerated.
According to figures from Challenger, Gray & Christmas, CEO departures increased 12 per cent between
June 2024 and June 2025, marking the highest rate since the firm began tracking leadership changes in 2002.
Frequent changes at the top have affected workplace morale. DeCesaro explained that some clients reported working under three different presidents within 18 months, a situation that has caused both instability and uncertainty.
In some cases, leadership transitions offered hope for positive change, but in others, they deepened employee disconnection.
How the US economy has complemented
Interest rates remain elevated, making it more costly for businesses to borrow and expand. As a result, companies are cautious about hiring, and some are planning workforce reductions.
This month, a survey by the Conference Board found that more CEOs expected to reduce headcount over the coming year than to increase it — the first time such sentiment has been recorded since 2020.
Thirty-four per cent of executives anticipated shrinking their workforce, compared to 27 per cent who planned to expand.
This cooling labour market stands in stark contrast to the years following the pandemic, when demand for workers was so strong that job seekers could command higher salaries simply by changing employers.
At the time, job-switchers often experienced wage gains well above those who stayed. Now, the incentive to move has weakened, and the risks associated with leaving a secure position loom larger.
Experts caution that job hugging comes with trade-offs for
employees. Ullrich points out that remaining in the same role for too long may mean missing out on wage growth.
Historically, workers who change jobs tend to see larger pay increases than those who stay.
Bohn also warns of potential stagnation. “For example, workers who get too comfortable in their current role may stagnate rather than take on additional responsibility or learn new skills, which may impact marketability and career growth when the labour market improves,” he said.
In some cases,
employers might conclude that long-tenured employees are no longer meeting performance expectations if they fail to adapt or develop.
The phenomenon also poses challenges for new entrants to the workforce, such as recent graduates. With fewer people leaving their positions, vacancies are scarce, and opportunities for younger workers to break in are limited.
A 2024 Glassdoor report found that 65 per cent of employees felt “stuck” in their jobs, with the proportion rising to 73 per cent among tech workers.
Glassdoor’s lead economist, Daniel Zhao, connected this sentiment to trends such as “quiet quitting,” writing, “As workers feel stuck, pent-up resentment boils under the surface and employee disengagement rises.”
This disengagement is costly. Gallup’s State of the Global Workplace 2025 estimated that productivity losses from disengaged employees cost the global economy $438 billion in 2024 alone.
Tom McMullen, a Korn Ferry compensation expert, observed that with fewer employees moving, companies feel
less pressure to raise wages to match outside offers.
Training and recruitment costs also decline when turnover is lower.
Dennis Deans, a global HR business partner at Korn Ferry, argued: “It’s great to have a long-tenured workforce and build capacities within it.” With fewer employees leaving, companies have the opportunity to nurture in-house talent and create internal career paths.
But such stability may only be temporary.
DeCesaro cautioned that employers risk facing another wave of resignations once
economic conditions improve: “Another Great Resignation is coming.”
If companies do not invest in engagement, development, and communication now, they could see large numbers of workers depart at once when opportunities return.
Consultants warn that while employees may be staying put for now, underlying dissatisfaction remains. Quiet quitting, disengagement, and feelings of being stuck suggest that workers are not necessarily loyal to their employers but are instead biding their time until better opportunities arise.
As Korn Ferry’s Bohn put it, the danger of the current environment is that employees “remain in a holding pattern,” missing opportunities to grow while companies assume their loyalty is permanent.
With inputs from agencies
In 2021 alone, around 47 million people resigned, and that number rose to 50 million in 2022. It was a period marked by confidence in mobility, with employees feeling that opportunities were plentiful and attainable.
That cycle has now reversed.
Today, US employees are less likely to change jobs, and labour economists say a new trend has emerged: “job hugging.”
The phrase, coined by Korn Ferry consultants earlier this month,describes workers clinging tightly to their
The US Department of Labour’s Job Openings and Labour Turnover Survey shows the national quits rate has hovered near 2 per cent throughout 2025.
With the exception of the early months of the pandemic, such consistently low voluntary exits have not been observed since 2016. Unlike the dynamic environment of just a few years ago, today’s labour market has slowed to a crawl, with both hiring and departures subdued.
Why job-hugging has taken hold
The reasons for this shift are rooted in both macroeconomic conditions and individual worker perceptions. Rising borrowing costs, driven by high interest rates, have cooled business expansion.
Employers are not hiring at the same pace they once did, and job seekers have fewer positions to choose from.
Payroll data showcases this slowdown: in July 2025, the US economy added only 73,000 jobs, a sharp drop compared to the earlier monthly average of 111,000.
The ratio of job openings to unemployed workers has also narrowed significantly. In March 2022, there were roughly two openings for every person seeking work.
By June 2025, the ratio had fallen to nearly one-to-one, showing how much tighter the market has become.
This environment has changed worker attitudes. According to quarterly surveys by ZipRecruiter, 38 per cent of respondents in mid-2025 said they were “not confident at all”
Just three years earlier, only 26 per cent shared that sentiment.
Laura Ullrich, director of economic research for North America at the Indeed Hiring Lab, said this caution reflects the broader climate.
“There is this stagnation in the labour market, where the hires, quits and layoff rates are low. There’s just not a lot of movement at all,” she told CNBC.
Korn Ferry executive consultant Matt Bohn put it more bluntly: “There’s quite a bit of uncertainty in the world —
He compared the current mindset of employees to that of investors who prefer to sit on the sidelines until the time is right to act.
How employee perceptions of risk & opportunity have changed
The Eagle Hill Consulting Retention Index, which measures employee intent to remain in current roles, has shown steady increases since late 2024.
Employees report plans to stay put over the next six months,
Meanwhile, the firm’s Market Opportunity Indicator — which tracks how workers perceive outside job prospects — recorded a 4.4-point decline in the last quarter of 2024, reaching its lowest level since the measure was introduced in 2023.
At the executive level, these dynamics are particularly visible. Stacy DeCesaro, a Korn Ferry managing consultant specialising in sales and marketing leadership, noted, “Right now, top performers are only leaving if they’re miserable in their roles.”
Also Watch:
Recruiters, she said, are finding it difficult to persuade high-performing executives to consider new offers unless compensation packages are exceptionally attractive.
This stagnation in movement has made recruiting across industries more challenging. It is not limited to rank-and-file employees but extends to management and senior leadership.
At the same time, CEO turnover has accelerated.
According to figures from Challenger, Gray & Christmas, CEO departures increased 12 per cent between
Frequent changes at the top have affected workplace morale. DeCesaro explained that some clients reported working under three different presidents within 18 months, a situation that has caused both instability and uncertainty.
In some cases, leadership transitions offered hope for positive change, but in others, they deepened employee disconnection.
How the US economy has complemented
job-hugging
Interest rates remain elevated, making it more costly for businesses to borrow and expand. As a result, companies are cautious about hiring, and some are planning workforce reductions.
This month, a survey by the Conference Board found that more CEOs expected to reduce headcount over the coming year than to increase it — the first time such sentiment has been recorded since 2020.
Thirty-four per cent of executives anticipated shrinking their workforce, compared to 27 per cent who planned to expand.
This cooling labour market stands in stark contrast to the years following the pandemic, when demand for workers was so strong that job seekers could command higher salaries simply by changing employers.
At the time, job-switchers often experienced wage gains well above those who stayed. Now, the incentive to move has weakened, and the risks associated with leaving a secure position loom larger.
What happens if you keep job-hugging
Experts caution that job hugging comes with trade-offs for
Historically, workers who change jobs tend to see larger pay increases than those who stay.
Bohn also warns of potential stagnation. “For example, workers who get too comfortable in their current role may stagnate rather than take on additional responsibility or learn new skills, which may impact marketability and career growth when the labour market improves,” he said.
In some cases,
The phenomenon also poses challenges for new entrants to the workforce, such as recent graduates. With fewer people leaving their positions, vacancies are scarce, and opportunities for younger workers to break in are limited.
A 2024 Glassdoor report found that 65 per cent of employees felt “stuck” in their jobs, with the proportion rising to 73 per cent among tech workers.
Glassdoor’s lead economist, Daniel Zhao, connected this sentiment to trends such as “quiet quitting,” writing, “As workers feel stuck, pent-up resentment boils under the surface and employee disengagement rises.”
This disengagement is costly. Gallup’s State of the Global Workplace 2025 estimated that productivity losses from disengaged employees cost the global economy $438 billion in 2024 alone.
Tom McMullen, a Korn Ferry compensation expert, observed that with fewer employees moving, companies feel
Training and recruitment costs also decline when turnover is lower.
Dennis Deans, a global HR business partner at Korn Ferry, argued: “It’s great to have a long-tenured workforce and build capacities within it.” With fewer employees leaving, companies have the opportunity to nurture in-house talent and create internal career paths.
But such stability may only be temporary.
DeCesaro cautioned that employers risk facing another wave of resignations once
If companies do not invest in engagement, development, and communication now, they could see large numbers of workers depart at once when opportunities return.
Consultants warn that while employees may be staying put for now, underlying dissatisfaction remains. Quiet quitting, disengagement, and feelings of being stuck suggest that workers are not necessarily loyal to their employers but are instead biding their time until better opportunities arise.
As Korn Ferry’s Bohn put it, the danger of the current environment is that employees “remain in a holding pattern,” missing opportunities to grow while companies assume their loyalty is permanent.
With inputs from agencies
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