Permanent job loser numbers climb to new highs as recession signal strengthens

As US unemployment inched up in February, the number of permanent job losers has risen to the highest level since 2021, a recession signal that has been growing stronger as the domestic labor market continues to weaken.

There were nearly 2.04 million permanent job losers in February, a group of Americans whose unemployment ended involuntarily as they were either laid off for good, fired, or their temporary jobs ended, according to the latest government data. The number of permanent job losers has risen about 16% from a year earlier and is now at its highest level since October 2021, when the labor market was still struggling under the global pandemic.

The number of permanent job losers in the US labor market has risen steadily since bottoming at about 1.17 million in September 2022, rising about 22,000 each month since then. Permanent job losers tend to increase going into a recession, the data shows. In the year leading up to the Great Recession, which began in December 2007, the number of permanent job losers spiked nearly 26%, for example.

"The increase in permanent job losers doesn't necessarily signal an imminent recession, but it is indicative of a labor market that's increasingly wobbly," said Jim Baird, chief investment officer at Plante Moran Financial Advisors. "A combination of slower economic growth and policy volatility is prompting employers to adopt a more cautious hiring stance."

The rising number of job losers was revealed in the US Bureau of Labor Statistics' latest jobs report, released March 6, which showed that overall unemployment inched up to 4.4% as 92,000 jobs were lost in February. The report also lowered January's job gains to 126,000 from 130,000 and revised December 2025's 48,000 jobs added to a loss of 17,000 jobs.

Some of the job losses in February were due to "specific catalysts," including a healthcare strike, government layoffs and cold weather and may not indicate broader weakness in the market, said David Russell, global head of market strategy at TradeStation.

"More permanent job losses show the labor market is weakening, but they haven't yet spiked to crisis levels," Russell said. "The labor market is slow and plodding, but we need more time and data to say it's stopped."

The US hiring rate, the number of hires during the entire month as a percent of employment, averaged 3.4% in 2025, unchanged from 2024 but down from 3.8% in 2023 and 4.2% in 2022, according to the latest government data.

Slow hiring is driving labor market weakening, said Julius Probst, senior economist at Appcast.

The rise in permanent job losers is "concerning," Probst said, but it only represents about 1.2% of the overall labor force.

"This is yet another data point that shows a steady weakening labor market, but no sudden acceleration toward layoffs," Probst said.

It remains unclear when, or if, a long-anticipated wave of layoffs will occur, according to Baird at Plante Moran. With no net increase in jobs since April 2025 and job creation flat over the last three months, job creation remains "very weak," Baird said.

If there is a sustained increase in unemployment claims in the coming weeks, it may signal a more concerning trend.

"That slippage from 'no hire/no fire' to a period of more pronounced job losses could become reality," Baird said.