Don’t count on worker shortage to magically disappear

Jobs

A shortage of workers is becoming a fixture of the U.S. economy, changing what the workforce looks like and forcing businesses to raise wages, invest in automation and reinvent their services, The Wall Street Journal reports

About 4.3 million workers are still missing from the labor force a year and a half since efforts to slow the spread of COVID-19 cratered the economy.  

Workforce participation, or the number of people working or looking for work, has fallen broadly across demographic groups and career fields, but has dropped particularly fast among women, workers without a college degree and those in low-paying service industries such as hotels, restaurants and child care.

Many economists expected school reopenings, expiring unemployment benefits and the fading Delta variant to help boost labor-force participation this fall. But evidence suggests labor shortages might be deepening: Labor supply declined in September and workers quit at record rates in August. 

Many expect the labor shortage to last at least several more years, and some say it’s permanent. Of 52 economists surveyed by The Wall Street Journal, 22 predicted that participation would never return to its pre-pandemic level. Read the full story.