The Federal Reserve’s latest analysis indicates that U.S. labor‑force growth is expected to fall to near‑zero in 2026. The slowdown is driven by weak population growth, largely due to reduced net immigration, and a declining potential labor‑force participation rate linked to an aging population. A near‑zero growth rate would also bring breakeven employment growth—the number of jobs needed to keep the unemployment rate stable—down to almost zero, meaning monthly job changes could be almost as likely to be negative as positive. Additionally, any increase in potential gross domestic product would have to come entirely from productivity gains, marking a shift from historical growth patterns that relied on both employment and productivity increases.
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