How can the labor shortage be fixed?
“The 360” shows you diverse perspectives on the day’s top stories and debates.
What’s happening
The United States economy is currently dealing with its most intense labor shortage in decades. At the end of December, there were nearly 11 million job openings across the country and just 6.5 million unemployed workers, according to the Department of Labor.
Looking at just the unemployment rate, it would appear that the American labor force had gradually returned to where it was before the coronavirus pandemic. But unemployment only accounts for those who are actively looking for work, so it doesn’t measure the millions of people who have left the workforce entirely. The causes of the current worker shortage are complex and weighted differently across different sectors. The pandemic has resulted in both a “Great Resignation” and a “Great Retirement” that have seen a significant uptick in people voluntarily leaving their jobs. Many workers and employers have also struggled to adjust after the enormous disruptions of early 2020.
The tight labor market has hit certain industries — like health care and hospitality — particularly hard, but it’s having an impact across the entire economy. Workers’ wages have gone up as businesses compete to attract new employees. Those gains, though, have been outpaced by inflation, which at least in part is fueled by the labor shortage. Many economists also argue that the scarcity of workers is stifling productivity, slowing the recovery and exacerbating supply chain issues that have plagued the U.S. for months.
Why there’s debate
Proposed solutions to the labor shortage generally fall into two categories: immediate moves to help businesses meet their staffing needs as quickly as possible, and more systemic changes that could help make the U.S. labor supply more resilient in the long term.
Fixing the current labor shortage, experts say, will require both increasing the size of the potential worker pool and doing a better job connecting the workers who are currently available with jobs that meet their needs. Groups that could potentially be tapped include immigrants, teenagers, the formerly incarcerated and the recently retired. Others say companies can alleviate their staffing woes by breaking from sometimes rigid hiring practices that may overlook worthwhile candidates who are seeking employment.
There is also a partisan divide on the best way to respond. Many on the left argue that what the country is facing isn’t a labor shortage, but really a shortage of meaningful work. They say that better pay and improved working conditions are the best ways to entice people back into the workforce. Some conservatives, on the other hand, say lifting burdensome regulations — including COVID-19 restrictions — will make it easier for businesses to find workers.
What’s next
With so much about the state of the economy tied to the state of the pandemic, many economists are hesitant to make predictions about when the labor shortage might resolve. “We don’t have a strong labor force participation recovery yet, and we may not have it for some time,” Federal Reserve Chair Jerome Powell said in December. It’s also possible, some argue, that elements of the current labor shortage may even be permanent.
Perspectives
The labor shortage is really a shortage of meaningful work
“We need to fix work, not workers. I believe the inability of employers to fill job openings … is no labor shortage but rather an indictment of the low-quality jobs that tens of millions of Americans have languished in for years. The pandemic has exposed business models that undervalue and underpay workers, often subjecting them to dangerous conditions — now and before Covid-19.” — Don Howard, Forbes
The left must stop denigrating blue-collar work
“Progressives have a corrosive need to portray workers as helpless victims of capitalism. … Essentially, progressives childishly argue that there is more honor in being dependent on government than in taking a job you don’t want. Of course, there’s nothing disreputable about working as a cook or waiter or front-end manager.” — David Harsanyi, National Review
Strict regulations that hurt workers and employers must be eliminated
“Government permission slips make it challenging for individuals to enter certain occupations, licensing requirements reduce the available workforce for many industries. … Too many workers have been shut out of the market because of regulation, and too many consumers have been deprived of the benefits of more competition.” — Connor Boyack, Deseret News
The simplest way to attract more workers is to give them more money
“The numbers indicate that many workers are leaving low-paying jobs for better-paying positions in the same sector, suggesting that the ‘labor shortage’ is really a wage shortage. Raising the minimum wage then would likely be an effective economic policy to combat the pandemic-era labor crisis.” — Paul Constant, Business Insider
A massive backlog of immigrant work visa applications must be cleared
“Due to pandemic-era policies that have prevented some 2 million new immigrants from coming to the US, the available supply of those workers is smaller than it otherwise would be. The US needs to leverage its existing immigrant workforce, but the work permit backlog is standing in the way.” — Nicole Narea, Vox
People without college degrees need more paths to worthwhile careers
“Yes, there are unfilled jobs that come with ladders leading upward, but workers know that sooner or later they’ll hit a class ceiling. The underlying cause of workers’ withdrawal is their accurate perception that in post-COVID America the only good jobs are reserved for college graduates or highly skilled artisans such as electricians or plumbers.” — David Lebedoff, Star Tribune
Bias against formerly incarcerated workers must be eliminated
“Without a more concerted effort to reintegrate workers with criminal histories into the labor force, employers are losing out on a big pool of willing workers.” — Anneken Tappe, CNN
Democrats’ COVID response is holding back labor force participation
“So, it’s not just that Biden gave a bunch of people cash when they should have been told they could safely return to normal without killing seniors. The regulatory regime, from the rules governing public schools to capacity and mask restrictions, have made work impossible for many parents and wildly uninviting to seniors who may not be keen on wearing masks for entire workdays.” — Tiana Lowe, Washington Examiner
More immigration is the only way to ensure the U.S. has a sustainable supply of workers
“Immigration is not a switch that can be turned on and off with the flick of a finger. But if we don’t prioritize letting more immigrants in, economic recovery and growth will be harder.” — Marcela García, Boston Globe
Companies that don’t adjust their hiring criteria will never find enough workers
“Despite employers’ whining about lack of workers, many are still being choosy, rejecting people deemed too young, too old, too uneducated, too inexperienced, and so forth.” — Ryan Cooper, the Week
The U.S. must stop allowing so much of its untapped talent to go to waste
“After so many decades of economic and military supremacy, the U.S. has fallen into the habit of thinking that it has easy access to all the intellectual excellence it needs. … Yet today the demand for top talent in the corporate world and elsewhere is exploding just at a time when the supply is threatened, as the public school system allows exceptional talent to molder and other countries do more to retain their own exceptional performers.” — Adrian Wooldridge, Bloomberg
Online job listings keep job seekers and employers from finding each other
“People are applying to job postings thinking a human being is going to look at their submission, but they rarely get through if they have a gap in their job history or don’t have the exact right key words.” — Joseph Fuller, management practice professor, to Washington Post
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Photo illustration: Yahoo News; photos: Getty Images
