Employee Sentiment Is Improving Again. New Revelio Labs Research Shows Why 2025 Marked a Turning Point
After nearly three years of steady decline, employee sentiment in the United States has finally begun to recover. New research from Revelio Labs finds that worker perceptions of their jobs improved throughout 2025, marking a clear reversal from the post pandemic burnout and dissatisfaction that defined much of the early 2020s.
In a December 9, 2025 report, Loujaina Abdelwahed, Head of Economic Research at Revelio Labs, documents a broad based rebound in employee sentiment that began in mid 2024 and strengthened over the course of 2025. The turnaround comes despite a slowing labor market, rising unemployment, and fewer job openings, suggesting that the forces shaping worker sentiment have shifted.
Between August 2020, when employee sentiment peaked, and April 2024, overall sentiment ratings in the U.S. fell by roughly 5.6 percent. The decline was widespread across industries and was most pronounced at smaller companies. Workers reported worsening work life balance, rising burnout, weaker career mobility, and growing frustration with leadership and business outlooks.
That period now appears to represent the low point. After stabilizing through mid 2024, employee sentiment began to climb in the second half of the year and continued improving throughout 2025. Between January and November 2025 alone, overall sentiment rose by about 1 percent. For the first time in nearly three years, workers’ views of their employers improved rather than deteriorated.
One of the more surprising findings is that sentiment improved even as external labor market conditions weakened. Unemployment increased and job openings declined steadily during 2025. According to Abdelwahed, this dynamic helps explain the rebound. When outside options narrow, workers tend to reassess their current roles more positively. Fewer openings reduce perceived mobility, and higher unemployment raises job appreciation, both of which lift sentiment toward existing employers.
The recovery in sentiment has been broad. Every major category of employee sentiment improved between the first and fourth quarters of 2025. The strongest gains came from compensation and benefits and career opportunities, both of which rose by about 1.3 percent. Sentiment around business outlook followed closely, indicating growing confidence in company direction even amid a slower economy.
However, the rebound did not occur all at once. Revelio Labs’ data show a phased recovery across different aspects of the workplace experience. Work life balance was the first category to bottom out, reaching its trough in mid 2021 before slowly improving as post pandemic schedules normalized. Compensation and benefits sentiment reached its lowest point in mid 2024. Business outlook sentiment declined for the longest period, bottoming only in mid 2025 before rebounding rapidly.
These staggered inflection points reveal how employees process improvements. Workers tend to update their views on day to day conditions and personal wellbeing first. Confidence in leadership and long term company direction follows later. The 2025 rebound was not driven by a single shock, but by gradual improvement across multiple dimensions of work.
To understand what drives overall sentiment, Abdelwahed examined how different categories contribute to workers’ overall ratings. Using regression analysis that controls for industry and time effects, the research shows that the drivers of sentiment change depending on whether sentiment is falling or improving.
During the long decline from 2020 to 2024, culture and values, senior leadership, and business outlook were the strongest predictors of overall sentiment. When workers felt strained or uncertain, leadership credibility and organizational direction mattered most.
In the rebound period from April 2024 through November 2025, the pattern shifted. Culture and values became even more influential than before. Career opportunities gained importance, and work life balance emerged as a key contributor to rising sentiment. These changes suggest that when workers feel more secure, they place greater weight on internal mobility, culture, and sustainable work conditions.
The findings highlight that employee sentiment is shaped not just by workplace conditions, but by what workers prioritize at different moments in the cycle. Improvements in sentiment tend to build sequentially. Day to day wellbeing comes first. Career prospects follow. Confidence in culture and values strengthens once those foundations are in place.
For employers, the implications are clear. Sustained gains in employee sentiment require investment in company culture. During periods of stress, leadership and clarity matter most. During recoveries, opportunities for growth and mobility become central. As 2026 begins, the data suggest that while the labor market has cooled, the workforce is cautiously more satisfied, signaling a fragile but meaningful shift in how employees view their jobs.
