After one of the most volatile mornings for Wall Street in recent memory, President Donald Trump announced a pause on much of his tariff policy yesterday. And although the business world’s response was overwhelmingly positive, labor economists say the pivot is only a temporary reprieve for an already-troubled hiring landscape.  

“It’s going to give a little bit of certainty to businesses in the short term,” Cory Stahle, an economist at Indeed’s Hiring Lab tells Fortune. But “even though this is a pause, there wasn’t necessarily a full backing down. So there still is some looming uncertainty out there.”

Trump previously announced massive levies on some of America’s largest trading partners in a sweeping policy shakeup that he dubbed “Liberation Day.” In a Wednesday social media post, however, he said those plans would be put on a 90-day hiatus, and instead put a blanket 10% tariffs on all U.S. trading partners. The exception is China, which has now been assigned tariffs of 125% up from an already-high 104%. 

To say the news was a boost to the markets is an understatement. The S&P 500 went up 9.5%, while the Dow jumped by 7.8% before trading closed for the day. Financiers like Bill Ackman, who previously warned that the tariffs would cause a “self-induced, economic nuclear winter,” were quick to celebrate the news, praising Trump and calling the policy change “brilliantly executed.” 

But not everyone was so enthusiastic. The market wil “likely go higher for a few days, but I think permanent damage has been done,” Jake Schurmeier, portfolio manager at Harbor Capital and a former member of the Federal Reserve Bank of New York’s Markets Group, told Fortune on Wednesday. 

Although the pause is certainly good news for businesses staring down the prospect of lower revenue and potential hiring pullbacks if not outright layoffs, Trump’s pivot has only delayed the dread that has already permeated corporate America. Many companies have been trapped in a holding pattern as they try to figure out how to navigate a series of major changes over the past few months, including a presidential election, and subsequent workplace-related executive orders. 

It’s true that topline unemployment numbers remain low, but they cover up some troubling truths: many of the massive federal layoffs haven’t showed up in the data yet, and the fact that a significant portion of job seekers are taking more than six months to find a role. Hiring is also most often a long process, and savvy businesses aren’t just thinking one quarter ahead of time, says Stahl. 

“The labor market has been mostly paralyzed, mostly frozen,” he says. “It’s been a continued story of: What policies are going to happen from day to day? So I don’t think that this gives businesses a ton more certainty that they need to start going on a hiring spree.”

Azure Gilman
Azure.gilman@fortune.com

Brit Morse
brit.morse@fortune.com

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