The Coming Labor Shortage: Current Trends Point to a Shortage of Qualified Labor in the Immediate Future. Here Are Some Ways to Cope with It
Challenger, John A., The Futurist
Unemployment in the United States hovers near 6%--nearly double the 31-year low of just three years ago. In places like Los Angeles, Chicago, New York, and Silicon Valley, unemployment rates are well above the national average in the wake of the technology bust.
Corporate America has averaged more than 100,000 announced job cuts per month since 2001. More than 3.9 million job cuts have been announced in the last two and a half years, more than in the previous seven years combined.
Despite these alarming statistics on joblessness, another crisis--severe labor shortages--threatens employers across the nation. For thousands of laid-off workers, the dot-com bust, the recession, and the rising unemployment that followed seem to have erased all memory of recent labor shortages of the late 1990s. But thanks to an unprecedented convergence of demographic and educational trends, labor shortages are expected to return at an even greater level in the immediate future.
It will not be long before corporations will be compelled to open and operate their own schools in order to train their own workers. I am not talking about corporate schools where private educational companies manage school districts, a situation already becoming common in certain parts of the country. I am talking about places that could be called the Microsoft Institute of Technology or the Citibank Center for Education, where students would be taught specific math, science, and computer skills needed by the employer-educator along with general subjects like history and literature year-round.
Labor shortages may become so severe that retirement as we know it will vanish. The age at which people can begin collecting Social Security benefits will move from its current level of 65 up to 75 in order to oblige older workers to stay in the workforce as long as they can.
Companies suffering from labor shortages may even start to support the idea of human cloning in order to minimize the impacts of reproductive trends. Even more likely, they may also lead the way in the growth of artificial intelligence as an alternative to human workers.
These predictions may not sound outrageous to futurists accustomed to thinking outside the box and ahead of the curve. However, I guarantee that, if you mention impending labor shortages and possible results to the average person on the street or headed to the unemployment office, he or she would likely give you a look of disbelief.
"Labor shortages?" this worker would probably think. "How can there be worries about labor shortages when so many qualified workers--like myself--are sitting here jobless and have been for months?"
One problem is that most people are only concerned with now. They are not looking five to 10 years down the road. A bigger problem is that U.S. employers aren't looking very far ahead either. The farthest ahead most companies ever look is maybe one or two quarters. However, labor shortages are imminent. In fact, severe labor shortages are likely to return within 10 years. Some companies may begin feeling the pinch within two to four years. Certain industries, such as health care, are already suffering badly.
Worker Shortfall Ahead
In less than seven years, there will be nearly 168 million jobs in the U.S. economy, but only about 158 million people in the labor market to fill them--a shortfall of 10 million workers, the U.S. Bureau of Labor Statistics estimates.
The number of retirement-age Americans--65 and older--will grow at a much faster rate than the age groups that will be needed to replace them, U.S. Census Bureau projections show.
The number of people 65 and older is expected to increase 26% between 2005 and 2015, while the population of 40- to 54-year-olds will shrink by 5%. And there is not much relief behind them--the number of Americans 25 to 39 will grow by only 6% between 2005 and 2015.
A study by the Aspen Institute shows that the native-born workforce aged 25 to 54 relied upon by businesses to fuel their expansions surged 44% between 1980 and 2000. …