America’s Labor Shortage Explained
Nearly 11 million jobs are open. Companies are struggling to find people willing to work.
What’s causing this record breaking labor shortage? Do people just not want to work?
Here’s Five Fast Facts to explain the current labor shortage (hint: it’s complicated):
💃🕺Not everyone is partying on unemployment benefits: Some people blame the labor shortage on the (now expired) extra unemployment benefits. But the reality is that if every American who was on UI got a job and we'd still have 1.1 million jobs left over.
🐢👀Many unemployed are looking for work but just taking their sweet time: Only about 10% of job-seekers say they are reluctant to work due to their unemployment payments. Another 21% of job-seekers say they have a financial cushion to buy themselves more time to find the right job, while 18% say they have other care responsibilities (will daycare be open or not?).
🏖️🏃♂️💨👴🏻Early retirements increased during the pandemic: More than 3 million Americans retired last year compared to an average of about 2 million a year since 2011. That includes about 1.1 million baby boomers retiring early and only about 270,000 early retirees intending to keep working within the next year.
📉🤷Certain industries have more job openings than qualified workers: For example, in education and health services there’s 1.7M job openings and only 1.1M people whose last job was in that sector. The same goes for retail, manufacturing, and hospitality. Many think this is because of all the extra retirements during the pandemic or because people don’t want their old jobs back.
🏨🍔Retail and hospitality have less jobs but better pay: For example, restaurants and bars are down by 1.7 million jobs (10% lower). However, the average pay increased by 5.4% in retail (average of $18.70/hr) and 12.8% in leisure and hospitality (to $16.60hr).
Bottom line: The good news about this labor shortage is that there’s never been a better time to boost your Paycheck. We are already seeing the fastest average wage increases in 13 years and massive increases in benefits from big companies (like paid tuition). Even before the pandemic, 60% of companies were willing to hire people with less than the required experience –now, companies are even more desperate. So, step out and seize the opportunity!
