While unemployment has remained at or below 4.5% since the Covid-19 pandemic-driven recession, more people are finding themselves jobless for extended periods of time.

Currently, around one-quarter of all unemployed people in the US have been out of a job for at least six months, according to the Bureau of Labor Statistics. That was around 1.9 million people in February, up nearly 1.5 million over the prior year, per the BLS. The last time long-term unemployed people made up this large a share of all unemployment was in early 2022, as the economy recovered post-recession.

Now, however, the labor market looks very different. Companies that over-hired during the Great Resignation have corrected by laying off workers or refusing to backfill empty positions. And many companies are cutting back on staffing costs to make room in the budget for AI investments. Hiring is also down due to several economic macrofactors: Uncertainty driven by high interest rates, tariffs, and inflation already had many business leaders hesitant to make investments, including in hiring, and the sudden war in the Middle East will only make that worse, according to Stephen Dwyer, president and CEO of the American Staffing Association.

“You have this shedding of employees, you have a lack of new jobs being created…we’re seeing as a result of that skilled, really talented, unemployed workers struggling to find their next role,” Dwyer told HR Brew. “I mean, all of this is the perfect storm.”

While many employers are hesitant to hire for full-time roles, Dwyer noted that staffing agencies have seen an uptick in employers looking for temporary or contract workers, and job seekers have taken these jobs to get their foot in the door, should permanent opportunities become widely available again.

That said, the résumé gap taboo persists, and some job seekers say hiring teams still punished them for it.

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