Where Are the Workers?
This post is a bit long but I think important as businesses struggle to find workers. There are a host of insights here and, in the end, there are many answers to the question, "Where are the workers?"
I was at a major business meeting recently put on by the Greater Des Moines Partnership…one of the largest combined business groups in the nation. The event was to highlight their legislative wish list for 2022.
During the Q & A session one business person asked this: “Everywhere you look there are businesses looking for workers but they are not there. Where have these workers…gone?”
Well, the answer is complex but let’s take a shot.
Business Insider is offering up a number of reasons and let’s start out with…money.
An MIT and CNBC analysis earlier this year found that even a $15 minimum wage wouldn't be a living wage for many families. Anecdotally, businesses paying higher wages haven't struggled as much with labor shortages and understaffing.
Show me the money…is what we’re hearing.
The love, hate you job issue is real. According to an Indeed survey of about 1,000 people who "voluntarily resigned from at least two jobs since March 2020," most of them (92%) said "the pandemic made them feel life is too short to stay in a job they weren't passionate about."
Flexibility is important: One of the industries feeling the most pain is leisure and hospitality. Even if employers in that sector increase wages, they may have trouble finding workers because those jobs have to be done in person…and there isn’t much flexibility in scheduling.
According to one survey of 10,000 knowledge workers from Future Forum, workers want flexibility in both location and schedule.
Child care is an issue. First will the children be safe and secondly child care is so expensive that many parents have done the math and it makes more sense to stay home than pay child care costs that may be more than their mortgage payment.
As the pandemic stretches on…many workers just don’t want to chance getting sick. The Bureau of Labor Statistics said that, in November, 1.2 million people didn't look for work because of the pandemic. In addition, some workers may be quitting or staying out of work because they're hesitant to get the vaccine, as more businesses put requirements in place.
More workers have…also…retired early…and now some may want to come back into the workforce…time will tell.
Immigration is also a root cause of the shortage… There are about 1.2 million adult foreign workers or work-eligible immigrants who are just not here because of the restrictions that have been imposed during the pandemic.
There is also a job disconnect between available workers and the jobs that are open. 48% of jobseekers surveyed by FlexJob said that they're frustrated with the job search, because they weren't finding the right positions — and the ones that are open pay too low. Back to pay again.
Job burnout is another factor…some workers are resigning because of burnout, putting added stress on employers and the remaining employees. Workers are taking on extra duties as companies struggle to fill positions, leading these workers to also feel burned out.
Technology is also to blame….qualified workers might be applying for roles that fit them, but hiring managers don't even know. Some are getting filtered out by hiring software. As the Wall Street Journal first reported, a Harvard Business School study found that over 10 million workers are filtered out by hiring software.
Employers also filter out workers because of preexisting biases and inequities.
Roughly 70 million workers don't have a college degree, but are known as "STARS" — Skilled Through Alternative Routes. They account for two-thirds of American workers, but many may be filtered through educational requirements…that often really don’t match the real world job requirements.
Often felons are filtered out…and there continues to be a big divide when it comes to white workers vs. black workers…with black unemployment still high.
Finally…people are done working for others and want to become their own boss. According to Bloomberg's reporting on business applications from the Census Bureau, there have been a record number of applicants in the first nine months of 2021 compared to the first nine months in previous years.
The US reached its highest number of unincorporated self-employed workers during the pandemic so far in July 2021 — also the highest number since the last big crisis to hit our country in 2008.
So, where have all the workers gone…? Lots of possibilities.