Third Annual Employer Survey explores how AI is reshaping hiring, what’s next for the labor market, and how pay, benefits, and skills continue to evolve

ZipRecruiter® (NYSE: ZIP), a leading online employment marketplace, today released findings from its Third Annual Employer Survey, revealing that the labor market's "Great Freeze" may finally be starting to thaw.

Employee turnover has dropped sharply, from 177% in 2023 to just 50% in 2025, marking a historic slowdown in movement as businesses and workers alike choose stability over change. But signs of momentum are emerging: nearly two-thirds of businesses (63%) plan to increase hiring in the year ahead, especially for entry-level roles that were hit hard during the slowdown.

“Our research suggests ‘The Great Freeze' is giving way to 'The Great Thaw,' and the most prepared employers are already taking action. We’re seeing businesses ramp up entry-level hiring, drop degree requirements, and incorporate skills assessments into their process,” said Nicole Bachaud, ZipRecruiter Labor Economist. “The organizations that adapt to new technologies, prioritize skills, and invest in their workforce will gain a competitive edge in securing top talent as the market shifts.”

ZipRecruiter surveyed individuals responsible for hiring decisions at 1,500 businesses of varying sizes and industries throughout the U.S. to gain insight into employers’ perspectives on recent hiring trends and their experiences with current U.S. labor market conditions. Key insights include:

The Labor Market’s Next Chapter:

• Economic shifts drove job hugging behaviors. In 2025, 30% of employers reported lower employee turnover due to external economic factors, up from 24% in 2024.
• Employee retention will be a key focus. With a potential thaw on the horizon, the majority of employers (76%) say that employee retention will be a key focus for the year ahead.
• Entry-level workers could see more opportunities in the year ahead. 32% of employers plan to hire more entry-level workers over all other roles.

The Evolving Nature of Pay, Benefits & Skills:

• Pay growth on the horizon. While 57% of employers kept base pay unchanged in 2025, 61% plan to raise salaries next year, an encouraging sign amid hiring challenges, as one-third (34%) struggled to attract candidates seeking higher pay.
• Businesses embrace skills-based hiring. With many businesses dropping degree requirements, 38% of companies are shifting their focus to evaluate skills earlier in the hiring process through the use of candidate assessments.
• People-centered skills most sought-after. Job postings in 2025 rank collaboration, customer service, and communication as the top 3 most in-demand skills.

AI’s Role in the Hiring Landscape:

• AI hype outpaces adoption in hiring. Though 72% of employers see AI as a way to streamline recruitment, only 43% have used it in their hiring processes over the past year.
• AI driving new job creation. More than half of surveyed employers (52%) report that AI is generating new roles within their organizations.
• SMBs lead the charge over enterprises in AI usage. More SMBs (47%) report having used AI in their hiring efforts in 2025 than enterprise employers (35%).

To view the full report, please visit: ziprecruiter-research.org/annual-employer-survey-2025.

Methodology

ZipRecruiter conducted a national online survey between September 8 and 16, 2025, to explore employer attitudes toward recent hiring trends and their experiences of current U.S. labor market conditions. The survey was administered to a PureSpectrum panel of 1,500+ verified talent acquisition professionals and hiring managers, each with considerable responsibility for hiring processes and decisions. They were drawn from businesses of various sizes across a wide range of industries. In addition to standard screening and demographic questions, respondents were asked about their recruiting, hiring, employment, and retention practices, as well as their expectations, desires, and requirements for future talent acquisition activities.

About ZipRecruiter

ZipRecruiter® (NYSE: ZIP) is a leading online employment marketplace that actively connects people to their next great opportunity. ZipRecruiter’s powerful matching technology improves the job search experience for job seekers and helps businesses of all sizes find and hire the right candidates quickly. ZipRecruiter has been the #1 rated job search app on iOS & Android for the past eight years¹ and is rated the #1 employment job site by G2.² For more information, visit www.ziprecruiter.com.

¹ Based on job seeker app ratings, during the period of January 2017 to January 2025 from AppFollow for ZipRecruiter, CareerBuilder, Glassdoor, Indeed, LinkedIn, and Monster.

² Based on G2 satisfaction ratings as of January 10, 2025.

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