New research indicates that the hiring freeze experienced by many U.S. employers in recent months may soon be lifting. According to the 2025 ZipRecruiter Annual Employer Survey, 63 percent of hiring professionals plan to increase headcounts within the next year, signaling a shift from a defensive to an offensive hiring strategy. This change comes as many companies reassess economic uncertainties that previously hampered recruitment efforts. The survey highlights that over 31 percent of HR officials intend to fill entry-level positions again, which had largely been stagnant. Additionally, 38 percent of respondents report dropping college degree requirements in favor of specific job skills and experience. The report notes that a significant gap exists between salary expectations of candidates and what employers are willing to offer, potentially hindering recruitment efforts.
According to a recent analysis by workplace platform Visier, approximately 5.3% of laid-off employees are being rehired by their previous employers, indicating that the anticipated widespread job displacement due to AI may not be materializing as expected. Despite layoffs increasing, there is a noteworthy rise in rehiring rates, suggesting that companies may be grappling with the realities of AI implementation and its impact on the workforce. Additionally, the financial implications of layoffs are significant; for every dollar saved, companies may incur $1.27 in costs related to severance and unemployment insurance.
A report from the Federal Reserve Bank of Philadelphia highlights that jobs requiring a bachelor’s degree are over three times more exposed to automation compared to those that do not. Despite the push for automation, research from the Center for AI Safety indicates that AI can only complete about 3% of tasks that humans handle reliably, leading many employers to regret their decisions to replace workers with technology.
Major companies like Amazon, Apple, and Google are mandating employees to return to the office at least three days a week, yet evidence suggests this may lead to employee dissatisfaction and talent loss. While companies expect productivity gains from in-office work, the reality is that many employees prefer the flexibility of remote work, which they feel enhances their productivity and work-life balance. Historically, the labor market has fluctuated, with a notable shift in 2022 when companies struggled to fill positions, leading to incentive offers such as remote work and signing bonuses. As the job market evolves, companies enforcing return-to-office mandates may find themselves losing valuable employees, especially as workers seek environments that prioritize flexibility and comfort.
Remote companies like Dropbox and Atlassian are experiencing a surge in job applications as many firms return to in-office work. According to LinkedIn, about 8 percent of job postings in the U.S. offer remote work but attract 35 percent of applications. Companies such as Deel have reported receiving over 1,200 applicants for a single remote position in just two weeks, highlighting the competitive advantage of remote work environments in talent acquisition. Melanie Rosenwasser, Chief People Officer at Dropbox, noted that their virtual-first model has led to nearly sevenfold higher applicant numbers per job compared to pre-2021 levels, while employee retention has also improved significantly.
Why do we care?
So here’s the shape of the labor market right now: employers say they’re ready to hire again. ZipRecruiter finds 63 percent expecting to add headcount and even reopening some entry-level roles. That sounds good—until you remember this is sentiment, not action. We’ve all seen how fast that optimism evaporates when the economic winds shift.
But here are the parts that matter for IT services. Companies are dropping degree requirements and leaning harder into skills-based hiring. That’s the talent pool MSPs already live in. And there’s a salary expectation gap forming—meaning candidates might start recalibrating what “fair pay” looks like. MSPs could actually come out slightly advantaged here, at least temporarily.
Now, the AI layoffs narrative? More hype. Visier reports the same companies are rehiring five percent of laid-off workers. Turns out replacing people with AI is harder than it sounds, and it’s more expensive too. For every dollar saved, you can spend more than a dollar in severance and unemployment. That’s a painful way to learn governance.
And while executives keep talking about automation replacing jobs, the Center for AI Safety says AI can reliably perform about three percent of human tasks. Three. The disconnect between what leaders believe and what AI can actually do is enormous—and this is exactly where MSPs can step in and be the reality check for customers.
Meanwhile, big companies pushing return-to-office are discovering a predictable result: people hate it. And they’re leaving. Remote-first companies are drowning in applicants; Dropbox is reporting seven times more candidates per job. If you want to scoop up talent fleeing RTO, now’s your chance.
This is one of those rare market conditions where MSPs can position themselves as the flexible employer, the skills-based hirer, and the practical AI advisor—while large companies keep tripping over their own policies. If you lean into that, you win.