‘The market wore me down’

After six months of scouring job listings and sending off resumes, Dan Coda’s job search came to an end. He didn’t find the technical program or project management job he wanted; he just stopped looking altogether.

Starting around December 2025, when he was laid off from his previous role, Coda says he spent more than 300 hours job hunting, submitting dozens of applications, hearing back about 15 potential roles and going through multiple rounds of interviews to no avail. By June, Coda says he was done with the grueling effort of looking for work.

“The market wore me down,” the 40-year-old from Durham, North Carolina, tells CNBC Make It. “I was hitting wall after wall after wall and not getting anywhere.”

This year, the number of announced layoffs in January reached a level not seen since 2009, during the Great Recession, according to data from global outplacement firm Challenger, Gray & Christmas. “The candidate pool is absolutely flooded,” Coda says, citing mass layoffs pushing thousands of affected workers like himself into the job market at once. With that kind of competition, he says, “What chance do you stand?”

Discouraged job seekers like Coda, who have given up on finding work, at least for now, are part of a trend economists say is worrying: The labor force participation rate has been on a downward trajectory since the turn of the millennium, fueled by an aging population and fewer young people entering the workforce.

June saw the biggest one-month drop in prime age labor force participation of workers ages 25 to 54, excluding the Covid-19 pandemic, since June 1976. Roughly 720,000 people stopped working or looking for work between May and June, according to the St. Louis Fed. Those leaving the workforce are both men and women, and the majority are ages 25 to 34, says Heather Long, chief economist at Navy Federal Credit Union who specializes in the economics of the middle class.

Meanwhile, elevated levels of long-term unemployment persist. In June, more than 1.9 million Americans, or roughly 1 in 4 unemployed people, were jobless but still looking for work for longer than six months, according to U.S. Bureau of Labor Statistics data. A continuous low-hire, low-fire job market could make it more challenging to find work and push more people out of the workforce altogether.

Official numbers on how many people are dropping out of the workforce are likely to be revised downward in the coming months, Long says, noting that the one-month spike indicates “something wasn’t quite right” in the initial data pull. But falling labor force participation nonetheless adds to a picture of an American labor economy seemingly out of balance with few solutions in sight.

And the factors pushing people out of the labor force have implications beyond workers paying for everyday essentials, including stunting career trajectories and impacting long-term retirement savings.

Economists say several compounding factors are likely driving down the labor force participation rate, like an exodus of retiring workers and lower immigration into the U.S. Some working parents, especially moms of young kids, and people with disabilities may be striking out as they face more competition for remote or flexible work opportunities that are harder to come by today, Long says.

Mental wellbeing could also play a part. Coda says he stopped his job search in June after a conversation with his wife, who’d noticed how the tiresome process soured his mood.

“Other than the death of a family member or a close friend, [unemployment] is one of the most devastating things that people face,” Carl Van Horn, director of the Heldrich Center for Workforce Development at Rutgers University, told CNBC in June.

About half of job seekers say the search negatively impacts their mental health due to rejection, lack of responses, financial pressure and waning motivation, according to an April Resume Genius survey of 1,000 active U.S. job seekers.

Meanwhile, employers also tend to question resume gaps, which can make it harder for candidates to find work the longer they’re searching.

Coda says his mental health during his job search, while dispiriting, was less affected by the tepid responses because his family had been saving aggressively. He and his wife, who still works full-time in HR, had been working toward an early retirement. And though they’re now dipping into those savings, Coda says the family can better afford his hiatus as they’re scaling back on dining out, yard maintenance and housecleaning services.

Others are less lucky. Haina, who like some other people from Inner Mongolia in China has only one name, says she’s relying on family after an exhausting job search strained her mental health.

The 33-year-old was living in New York when she was laid off from her marketing analytics role in November 2025. Over the next few months, she set up interviews and even secured a few offers, but she says finding a new employer to accommodate her H-1B visa needs has been difficult. (Employers often have to apply on behalf of employees for visa transfers costing thousands of dollars between filing, processing and attorney fees.)

In May, Haina stopped her U.S.-based job search and headed home to Inner Mongolia to stay with family. Since then, she says she feels more like herself again. The job search was a “roller coaster of ups and downs,” Haina says: “If you met me a month ago, I was a completely different person. I didn’t have energy.”

Haina is currently staying with her parents, which means she has minimal expenses, and says she relishes being home for the first extended period of time since she left for the U.S. eight years ago.

“I just want to really take this [moment] to spend time with my family and really think about what I want to do,” she says.

In a tough job market, it’s typical to go back to school. Added credentials can confer a competitive edge or help job seekers break into a new industry altogether. Consider the college “enrollment boom” during the Great Recession of 2007 to 2009. The number of college students who returned to school after being in the labor market or otherwise out of school grew by 30% from 2006 to 2010, per Census data.

Celine Wang hopes more education will pay off. The 26-year-old is currently in school to become a dental hygienist after spending a few years working as a digital designer. Wang says she was feeling stagnant in her design agency job and in 2024 quit without a new one lined up. She didn’t realize how competitive the current job market would be as she spent the next year applying to jobs, she says: “The job hunting experience was rough to say the least.”

Her frustration led to a turning point in the fall of 2025: Before an eighth-round interview, she told herself, “If I do not get this one, then I need to just like pack it up and try something else.” Wang says she was passed up for the job and began considering a career switch into healthcare, which has been propping up the U.S labor economy, for its demand and relative stability.

She researched her options, spoke with family and friends about their healthcare jobs, and applied to a dental hygiene program in New York City.

Wang began her program in May and expects to earn her associate of applied science by the end of 2027. In a “perfect world,” she envisions herself working part-time as a dental hygienist and still doing design projects on the side.

“I’m not sure what that looks like yet,” Wang says of her design ambitions, “but I don’t want to let that part of me go.”

While a workforce hiatus might be a welcome break, most people can’t afford for it to last forever, especially in the face of rising costs of living.

Wang, for example, feels grateful to be able to return to school because she lives with family and has fewer expenses.

Some stalled job seekers see a pause as a chance to embrace their newfound free time to seek clarity and purpose. Haina says she still hopes to return to the U.S. for work but is also using her break to reconsider her career and life plan in general, whether that’s at home or back in the U.S.

As for Coda, he and his wife plan to give his self-described sabbatical up to a year. For now, he says he has much more energy to be a present parent to his 3-year-old during his temporary break from the labor force.

“This feels scary, but good,” he says. “I think this is the right decision.”

If you’re experiencing a mental health crisis or concerning mental health symptoms, you can contact the free, confidential National Helpline for Mental Health at 1-800-662-HELP (4357).