Reasons for the Labor Crisis
Loss of the Retirement Generation
Pre-pandemic levels of the labor force participation rate were much higher than today, with a major chunk of the workforce now retired. Whether forced into early retirement by being furloughed or laid off or doing so willingly; Covid-19 has greatly impacted the participation and recovery of older workers. As the Boomer generation is less likely to return to work due to health risks, there is a sudden gap in the labor force that has surged post-pandemic.
The number of retired workers increased from 45.1 million to 69.8 million, in 2021 from 2019 – Annuity.org
The Skill Shortage and Mismatch of Jobs
With the older generation not returning, the younger ones do not have the necessary experience employers are looking for in the changing job market today. Those organizations that are recruiting are facing challenges in acquiring the right fit, claiming a lack of skills and a 15-year high talent shortage among mismatched applicants. If employers can’t find what they are looking for, the open positions are likely to go unfilled, creating a further gap.
Requiring years of experience for a particular post, employers want in-person on-site workers that they don’t have to train. Whereas the working generation (mostly millennials) demand remote hours and flexible environments, so they don’t have to return full-time. The younger generation is willing to continue looking for work remotely until they find something fulfilling or a job that caters to their mental and monetary well-being.
Burnout is on the Rise
The push towards the 9-5 grind by employers is also causing massive burnout to the existing employees. Taking on extra duties to keep systems running while trying to find a balance between home and work; employees are discontented and overworked. The current ones are already on the lookout to switch or quit their existing positions, just to let go of the stress, and search for better opportunities. If not addressed, this would lead to a greater labor shortage in the future.
Employees wanting to change their work situations from before are asking for higher wages in addition to benefits. Particularly driven by panic buying during the pandemic, the increased demand for goods and services has led laborers to imagine a better lifestyle. Stimulus aid may have changed the worker mindset permanently in the pandemic months. It is now that people have realized they were never happy with the existing work conditions (going on decades) and want to continue no further.
Some other connected reasons include wanting better payouts, discrimination at the workplace, desiring to be your own boss, shuffling careers, and childcare duties among others. Regardless of how many reasons there may be, they all work in the amalgam to create this current labor crisis which is likely to continue if the word “work” itself is not redefined.