In this month’s webinar, Ira S Wolfe and Gordon explore the post-pandemic labor and job market. They warn us about the labor shortages that face not just the U.S. but the rest of the world, as well. The prospects are frightening, and if there is not a change in the way families focus on the education of their children, educators educate children, and businesses offer training or similar opportunities, the bomb will explode, and the world will suffer in its wake.
Normal Has Two Sides (3:51)
Wolfe kicks off the webinar by discussing things are slowly getting back to normal or “normalizing” as the pandemic begins to taper off a bit. Some of the “normal” things going on in the world today include:
- America’s largest gathering since the pandemic, the Indy 500, is set to occur, and over 135,000 are expected to be in attendance.
- Costco is reintroducing samples in their stores
- Chick Fil A is running short on sauces
- Gas shortages due to lack of truck drivers to deliver
This shows that “normal” has both positive and negative impacts or “normal has two sides” (3:51).
Another area that is experiencing the negative side of normalizing is small business. According to the Bureau of Labor Statistics, there are 8.1 million job openings, a half-million more openings than the highest levels recorded in 2018, pre-pandemic. According to the National Federation of Independent Business (NFIB) a record number of small business owners reported job openings that could not be filled, double its previous high. Ninety-two percent revealed having few or zero prospective applicants, blaming a lack of job skills to carry out the duties required.
There are also 119,000 new jobs available to workers with skilled trades that have been posted in just the last month. In total, there are currently 281,000 job openings on the market. But, unfortunately, there are not enough carpenters, HVAC technicians, construction workers, plumbers, or electricians to fill the jobs. Consequently, many companies are forced to turn work down because they don’t have the workers needed to complete them. This is going to cause massive problems for economic recovery and growth.
A Ticking Time Bomb Is Now Exploding In Businesses and People’s Homes Across the Country (6:06)
Gordon tells us that “a ticking time bomb is now exploding in businesses and people’s homes across the country (6:06). The skills/job disconnect is getting worse all the time. Right now, Gordon believes there will soon be 14 million job vacancies. Gordon believes President Biden might be underestimating the challenge. Just because a job doesn’t require a four-year degree, it doesn’t mean it’s easy to fill. Just ask restaurants trying to recruit line cooks or servers or transportation companies seeking truck drivers. Gordon says that businesses need to offer more apprenticeships and training for specific jobs to disrupt this trend.
Rather than focusing on things that can help fill the job openings left vacant, companies are doing things like buying back stock, paying big dividends to shareholders, and giving executives very high bonuses. That money could be used to fund apprenticeships or on the company’s infrastructure for things like upgrading equipment. These options that would benefit the company and economy in the long run often get ignored because of the short-term costs and long-term results. Everyone’s mindset is still short-term-centric. Choosing not to focus on the long term causes the time bomb to tick even faster, ultimately causing more destruction once it erupts.
Only ⅓ of Those [Entering the Workforce] are Skilled and Trainable (9:23)
One-third of the Baby Boomers who are retiring right now are skilled workers (trades, managers, professionals). The generations entering the workforce are smaller in numbers, and “only ⅓ of those [entering the workforce] are skilled and trainable; thus companies will be unable to fill those jobs unless employers do something different. The majority of jobs being created that need to be filled require a better and different educational foundation and new skills that today’s workforce does not have. We need to prepare the up-and-coming (and current) workforce better. We need to reskill and upskill workers who are already employed, and that is not happening fast enough either.
People… Need to be Better Trained for the Jobs That We Need To Fill (12:50)
Wolfe agrees that many service jobs do fall into the category, low-skill, suggested by Biden. Gordon, however, says that while 90 percent of the infrastructure created in the American marketplace doesn’t require a degree, they do require training, education, and/or apprenticeship. Biden’s proposals to ease the labor shortages are not as cut and dry as he tries to portray. Gordon says that “people… need to be better trained for the jobs that we need to fill.” If not, it’s another reason we are rushing the bomb to explode.
By the Time a College Student is Out of School, By the Fourth Year, Half of the Information They Learned in the First Two Years is Out Of Date (13:14)
Wolfe, a Baby Boomer, reminds us that a four-year degree would get you through to retirement when he and his cohort entered the workforce. Today, “by the time a college student is out of school, by the fourth year, half of the information they learned in the first two years is out of date.”. This is a sad state of affairs. Advanced education is expensive and often not worth as much as it used to be. Much of it doesn’t prepare the students for in-demand jobs either. And while some organizations are assuming the responsibility for training future workers, most are not. This is dangerous in an environment when technology is evolving at an accelerating pace.
Blue Collar Jobs Have Turned Into Gold-Collar Jobs (14:36)
Blue-collar jobs, such as carpenters, plumbers, and airplane mechanics, were once considered less desirable. Now they are considered “skilled labor.” Many people didn’t want to work these jobs because of low pay and the blue-collar stigma surrounding them. Now, Gordon says, those “blue-collar jobs have turned into gold collar jobs,” many offering incomes of $100,000 or more. The reason for this shift is that those jobs are very high-paying today. Today many of these gold-collar jobs require more skills and offer better job security than jobs requiring a traditional college degree.
Wage Inflation is Starting Across the U.S. Economy (17:12)
Gordon says, “wage inflation is starting across the U.S. economy” (17:21). It’s just supply and demand: the labor market isn’t supplying enough qualified people to fill jobs. When supplies tighten but demand is high, something’s got to give. Companies are simply going to have to pay more. Unfortunately, that also means consumer prices will increase as a result.
This is a Worldwide Crisis (19:13)
By 2030, 95 million high-skilled jobs will be vacant around the world. Gordon says, “this is a worldwide crisis” (19:13). Because every major country across the globe will experience a shortage of skilled labor, immigration control will not be enough to save the US economy. There’s no “magic bullet.” Even aiding with the cost of child care or funding community colleges won’t do the trick by themselves.
The Gig Job May Be [the] Future (20:40)
Because of the way the economy is moving, people are often leaving the workforce to work for themself. Wolfe says that “the gig job maybe [the] future” (20:40). While it is not a “panacea” because being an entrepreneur is not easy, it can be profitable. Most Millenials and Gen Z members are used to having a side gig in addition to their full-time job. This is distinct and different from decades past, when “moonlighting” was a cause to be fired.
57% of American Adults Have Reading Comprehension Below the 8th Grade Level (24:40)
Gordon says, “57% of American adults have reading comprehension below the 8th-grade level.” Gordon calls them “technopeasants.” While it’s necessary to raise the minimum wage, workers still won’t have many of the fundamental and marketable skills businesses need. The quality of goods and services will decline across the US economy because the people being hired are not qualified for their jobs, and the companies are not training new employees for those jobs.
Companies Need to Change How They’re Hiring (26:37)
Wolfe says that “Companies need to change how they’re hiring.” They can’t bring in new employees with the lure of more money but treat them poorly. Another issue Wolfe brings up is that a garbage truck driver in New Jersey makes well over $120,000 annually. Because of jobs like that, people will not go to college and rack up a huge debt. Bad hiring practices just add to the labor shortages disrupting the economy.
Seventy-five percent of future jobs will be high-skilled jobs, but only 56 million workers are available to fill them, leaving a huge labor shortage. Automation will continue to increase the demand for educated workers and the education system today is not preparing students. Our “education system is based on mediocrity.” Businesses will leave the US because there are not enough skilled workers to fill the jobs. Companies will relocate to Europe or China, anywhere that can supply the skilled workers. Imagine what the economic and social havoc that the loss of 30 million jobs would bring.
We Are On the Verge of a Major Economic Disaster (30:39)
The economy is in trouble, and “we are on the verge of an economic disaster.” Parents must encourage their kids to do better in school, teachers have to be better trained, and businesses have to start offering better training. This is a systemic failure. We have to stop living in the past.