January Talent Market Index: Market Concentration, Cost Signals, and Fragmented Hiring Demand
As organizations enter 2026, the talent market narrative has become increasingly polarized. Headlines point to cooling demand. Hiring teams feel pressure. Budgets tighten. And yet, talent acquisition costs remain stubbornly high in the roles that matter most.
The U.S. labor market closed 2025 in what can best be described as a deep freeze, posting its slowest annual job growth since 2020. Yet the January Talent Market Index (TMI) reveals a more nuanced reality: hiring has not stopped, it has re-concentrated.
Demand has narrowed into fewer roles, fewer sectors, and higher-stakes positions tied directly to revenue, continuity, and operational execution. At the same time, talent acquisition costs are easing month over month, but remain elevated and uneven year over year, creating a labor market defined by fragmentation rather than relief.
Market Signal: Slower Growth, Concentrated Demand
In 2025, U.S. employers added approximately 584,000 jobs, a sharp decline from nearly 2 million jobs in 2024. December alone delivered modest growth of roughly 50,000 jobs, while unemployment ticked down slightly to 4.4%.
What stands out is not simply the slowdown, but how narrowly job growth is distributed:
- +27,000 jobs in Food Services
- +21,000 jobs in Healthcare
- –25,000 jobs in Retail, including –19,000 jobs among general merchandise retailers
This concentration explains why talent acquisition teams are experiencing fewer open requisitions, slower approvals, and less candidate movement. Hiring has not vanished; it has become uneven and increasingly role-specific.
What the Talent Market Index Reveals
The Talent Market Index tracks real-time employer spend on paid job advertising across nine key segments, providing direct visibility into hiring demand and recruitment cost pressure that traditional labor reports cannot capture.
January data shows:
- Month-over-month pricing cooled across most segments
- Year-over-year costs remain elevated and uneven
- Relief is not universal, and the market is increasingly splintered
The result is a market where some roles are thawing, others are tightening, and averages obscure meaningful risk.
Key Trends Shaping the Market
Hiring Volume Is Down, Competition Is Not
Even with fewer openings, competition for talent remains intense in roles tied to revenue, growth, and operational continuity. Today’s cost pressure is driven less by hiring volume and more by scarcity within critical skill sets.
This is why recruitment costs remain elevated despite slower job creation.
“Even if you weren’t hiring more people, you were competing harder for the same workers – and that’s exactly how talent costs spike this fast.”
— Mona Tawakali, Chief Strategy Officer at Talivity
Talent Discovery Has Shifted
Active job seeker pools continue to shrink as switching behavior remains historically low. At the same time, AI-driven search and social environments are reshaping how candidates discover roles, evaluate employers, and make career decisions.
This behavioral shift is eroding the efficiency of job-board–centric hiring models and accelerating the need for broader discovery-based strategies.
“Talent behaviors have shifted, audiences have shifted, and the companies that win are the ones who respond to this squeeze with innovation, creativity, and experimentation.”
— Adam Stafford, CEO of Recruitics
Industry Highlights: Where Pressure Is Concentrating
Food Services: Sustained Demand in a Slower Market
Food services emerged as a consistent outlier throughout 2025. While overall job growth slowed, this sector added an average of:
- 12,000 jobs per month in 2025
- 11,000 jobs per month in 2024
In December alone, food services added 27,000 jobs, leading all sectors. Voluntary quit rates in the industry remain more than twice the national average, driving constant hiring pressure.
Roles directly tied to revenue and physical locations continue to justify aggressive hiring investment, regardless of macro conditions.
Healthcare: Structural Scarcity Persists
Healthcare added 21,000 jobs in December and remains structurally constrained by:
- Credentialing requirements
- An aging population
- Persistent supply shortages
While the index shows slight month-over-month cooling, year-over-year cost pressure remains elevated, and competition for clinical and specialized roles remains intense.
Retail: Job Losses Without Cost Relief
Retail lost 25,000 jobs in December, with the steepest declines among warehouse clubs, supercenters, and general merchandise retailers.
However, net job losses did not translate into cheaper hiring. Employers continue to face pricing pressure for:
- Frontline roles
- High-turnover positions
- Competitive local labor markets
This disconnect reinforces why headline job losses are a poor proxy for hiring difficulty.
Transportation & Logistics: Cost Volatility at Its Peak
Transportation and logistics represented the most dramatic outlier in the January index, with talent acquisition costs reaching all-time highs:
- +126% month over month
- +111% year over year
This surge was driven by three converging forces:
- Record $257 billion in holiday e-commerce spending, sustaining fulfillment and last-mile demand
- Tightened freight capacity, with spot rates jumping 19% and tender rejections peaking at 13%
- A shrinking labor pool, with sector unemployment dropping to 3.6%, well below the national average of 4.4%
Even stable headcount environments can experience rapid and severe recruitment cost spikes under these conditions.
What This Means for Talent Strategy in 2026
The January Talent Market Index points to a market defined by concentration, volatility, and behavioral change:
- Hiring risk now sits at the role and market level, not in national averages
- Talent costs remain elevated where demand is concentrated
- Legacy hiring models are losing efficiency as candidate behavior evolves
Organizations that understand where demand truly sits – and adapt how talent is discovered, valued, and engaged – will be better positioned to control cost, protect revenue, and outperform peers.
Explore the Full Data
The Talent Market Index provides a real-time view into hiring demand, cost pressure, and market volatility across critical roles and sectors.
Explore the full data and methodology in this month’s report.
