This Week in Business Why Hiring Has Slowed Without Mass Layoffs
Feb 18, 2026
Peter Cappelli, Wharton management professor and labor market expert, walks through cooling white-collar hiring and where openings remain. He discusses why firms pause hires amid uncertainty, how vacancy chains amplify hiring when active, investor-driven cost cutting, and the reality behind AI-driven layoff claims.
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White-Collar Hiring Has Fallen Sharply
- Hiring slowdowns hit white-collar roles far harder than blue-collar ones, especially finance where openings fell ~50% year-over-year.
- Vacancy chains amplify hiring swings because internal moves create cascades of openings when firms expand or pause hiring.
Investor Pressure Discourages Hiring
- Investor pressure has reset corporate expectations, making boards and executives reluctant to hire and more likely to cut headcount.
- White-collar cuts are easier to delay effects on operations, so they spread faster across firms and industries.
AI Washing Masks Real Productivity Effects
- Many companies claim AI-driven cuts but often overstate AI's current ability to replace workers — a phenomenon Peter Cappelli calls 'AI washing.'
- Where AI is effective it more commonly boosts productivity so teams do more with the same headcount rather than producing immediate layoffs.