Labor Shortage: The Top 5 Things to Know

A labor shortage means employers are going through a tough time trying to recruit qualified people for job positions. It’s either there aren’t enough applicants to fill the positions, or the few available ones are hard to get. Some jobs are more complicated to fill, while some industries just go through a hard time recruiting and retaining people than others. However, labor shortages can do good things for your career if you know what to do.

What To Know About a Labor Shortage?

1) Kinds

Labor shortages are not just based on the available jobs and the number of workers. Different factors that affect hiring can complicate things. The basic kinds include the quantity of people. You will find that this shortage happens if qualified applicants to attend to an organization’s needs aren’t enough.  The quality of job candidates is another thing whenever an employer goes through difficulty in finding employees with required qualifications, this can cause a shortage.

2) Causes

Labor shortages are a result of different factors like an aging workforce, increased demand for IT services, Early retirement, a reduction of blue-collar workers, people quitting their jobs, Health concerns, workers opting for self-employment, people leaving the labor market, and Limits on immigration. Another cause is people quitting at high rates when the demand for them remains high.

3) Industries and Occupations

A survey carried out by the Society for Human Resource Management realized that about 73% of employers are experiencing a reduction in applications for positions that are difficult to fill. According to them, the hardest positions to hire for are hourly, entry-level, as well as mid-level non-managerial positions, particularly in sectors like manufacturing, hospitality, food service, as well as health care and this is causing a labor shortage.

4) Labor and Unemployment

Even though the job market possesses fewer jobs than in past years, there are more job openings compared to unemployed workers. In the month of April 2020, there were about five unemployed people for every available job. Then in September 2021, there was under one (0.7) worker for one job opening. In addition, there were about 7.7M unemployed people, about 10.4M job openings, and about 6.5M new hires and this caused a labor shortage.

5) How To Leverage the Situation

When in the job market or thinking about a career change, these labor shortages can potentially benefit not just your career but your paycheck as well. Sometimes, it can be quite easy to be employed in tight labor markets since employers can lower hiring requirements plus raise wages to attract applicants for the available positions. It is possible to get hired quicker as well since employers are facilitating the recruiting process to onboard fresh employees quickly.

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