Employers today are running into the same roadblock regardless of what industry they are in or how hard they attempt to recruit qualified employees – a skills gap problem that has persisted for a long time most particularly in skill-intensive industries like freight transportation, distribution, and warehousing.
“It is becoming clear that this is not a distant problem that requires abstract solutions. The future of work has arrived, and the American workforce is at an inflection point,” says the Littler Workplace Policy Institute in its most recent research report, “The American Workforce: Transformation – Challenges and Opportunities.”
The institute is the government relations and public policy arm of the law firm of Littler Mendelson – the global employment and labor law practice representing management The WPI focuses on defining and shaping workplace policy at the international, national, and local levels.
“New technologies and artificial intelligence are reshaping the workplace at unprecedented speed,” the report observes. “Many jobs and fields are obsolete due to innovations of the last two decades, yet these same advancements have spurred the creation of new occupations and industries.”
Littler WPI points out that employers across nearly every industry and sector are competing to find workers with the skills necessary for success. Students and workers should be prepared with in-demand skills “No one can predict the future, but we can study trends and work to improve real-time data to better prepare ourselves for this new economy,” the researchers hold.
“Investments in workforce systems and education, including the expansion of apprenticeship and on-the-job training, can equip the American workforce to thrive in a skills-based job market, “they add. “We need to prepare workers, businesses, elected leaders, governments, and educators for this reality, not only for the job market of 2023, but for the workplace of tomorrow."
As the U.S. Chamber of Commerce reports, businesses are “facing unprecedented challenges trying to find enough workers to fill open jobs.”
As of the end of May 2023, there were 9.8 million job openings in the United States, with six unemployed individuals per job opening, according to the. Department of Labor’s Job Openings and Labor Turnover Survey.
Among the factors contributing to the labor shortage include the declining birthrate over the last few decades and the aging population, the institute says.
Between 2000 and 2022, the median age in the United States increased by 3.4 years. The World Bank, says that over the next decade, the number of people of working age, between ages 15 and 65, will decline in the U.S. by more than 3% as Baby Boomer generation -- who were born during the surge in the birthrate following the end of World War II – retire.
At the same time, the Congressional Budget Office estimates that by 2030, the fertility rate is projected to be 1.75 births per woman, where it will remain through 2053. That rate is below the replacement rate of 2.1 births per woman – the fertility rate required for a generation to exactly replace itself in the absence of a rise in immigration.
Another concerning trend that has contributed to the labor shortage is the rising mortality rates among working-age Americans, the researchers found, noting that since 2010, death rates have risen for both young and older adults, driven by drug overdoses, alcohol, suicide, diabetes, and obesity-related health conditions.
The report also says that better-focused education and training also are important in addressing the skills gap. It takes note of Littler WPI’s continuing partnership with the National Association of State Chambers in working with state and local officials and businesses to address skill mismatches and meet the demand of the labor market through targeted educational programs.