Salespeople, waiters, postal workers — “Help Wanted” ads are spreading across the United States as businesses grapple with a pandemic-induced labor shortage, a spate of early retirements and restrictive immigration laws.
More than 10 million job vacancies remained unfilled in June, according to government data, while fewer than six million people looked for work, despite employers desperate to boost hiring amid a frenzy of consumer spending.
“We have many jobs but not enough workers to fill them,” the U.S. Chamber of Commerce, which represents American companies, said in a statement.
Many of those who stopped working when Covid-19 first ravaged the US economy in early 2020 have never returned.
“There would be 3.4 million more workers today if labor force participation” – the percentage of the working-age population currently employed or actively looking for work – were at pre-pandemic levels, the chamber calculated. It slipped from 63.4 percent to 62.1 percent.
And where have all these people gone? Many simply took early retirement.
“Part of it is just that the US population is aging,” Nick Bunker, a jobs specialist at jobs website Indeed, told AFP.
– Too few immigrants –
The huge cohort of “baby boomers” have already started exiting the labor market, but there has been a “acceleration of retirements” since the pandemic, Diane Swonk, chief economist at KPMG, told AFP.
Millions of people took early retirement, concerned about their health and with enough wealth – thanks to a then-buoyant stock market and high real estate prices – to leave the job.
In the short term, Bunker said, “Due to the aging of the population, it’s unlikely that we’ll return to exactly pre-pandemic levels of labor force participation.”
To this Swonk added: “We haven’t had immigration at the pace to replace the baby boomers.”
Restrictions imposed under President Donald Trump, as well as the impact of Covid, have severely reduced the number of foreigners entering the country.
“It’s recovered a bit, but still not at the level that we saw a few years ago,” Bunker said.
The Chamber of Commerce also underscored the impact of generous government support during the pandemic, which “enhanced people’s economic stability – allowing them to remain in the labor market”.
– Long Covid –
Many women quit their jobs in 2020, in part because the extended school closures forced many to stay home to look after the children.
Those who wanted to send children to day care centers were often frustrated because the labor shortage also affected the day care center sector.
Swonk noted that not only covid infections but also the debilitating effects of long covid were having a serious impact.
It’s “truly one of the most underestimated and misunderstood issues” that leaves workers sidelined, she said.
To lure workers back, many employers have raised wages and benefits.
And as Americans’ spending sprees slow, analysts say, companies will need fewer workers.
Labor shortages are expected to ease somewhat as the US Federal Reserve continues to raise interest rates aggressively to fight inflation.
Meanwhile, wage earners have benefited. Millions have changed jobs in the past year, often lured by higher wages and better working conditions.
This “Big Retirement” has led to higher hourly wages. The private sector average is now $32.27, up 5.2 percent in one year, adding to inflationary pressures.
The US job market showed renewed signs of vitality in July.
The 22 million jobs lost to Covid-19 have returned and the unemployment rate is at a historically low 3.5 percent.
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