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 Preparing for a Future Labor Shortage

Labor shortage is an economic condition in which there are insufficient qualified candidates (employees) to fill the marketplace demands for employment at any price. This condition is sometimes referred to by Economists as "an insufficiency in the labor force."

Workforce Shortage Crippling Many Industries

There are not enough quality people equipped with the right skills to fill all the jobs available, and it's going to get worse--a lot worse very soon.
Many of these worker shortages are found in the skilled trades, financial services, healthcare, and in the IT sector to name a few.

Most healthcare organizations are facing critical staffing shortages. The national nursing vacancy rate is approximately 13 percent. Enrollment in RN programs has declined by 50,000 or 22 percent. Finally, the average age of a RN is 43 years old.

The beginning of IT shortages is starting to emerge. Just this year, Google announced it was unable to meet their growth expectations because they could not find enough qualified technicians. As the economy grows many more shortages will develop.

Shortage of Workers

The aging workforce is an another issue businesses need to address. The simple truth is this country is not having enough babies. The growth rate of the workforce has been steadily declining since the 1970s. Both the U.S. Census Bureau and a report from Accenture Consulting indicate the workforce will begin to experience a negative growth rate in the very near future.

Consider the 45 to 65 year-old workers, whose census figures show is the fastest growing demographic. Estimates indicate by year 2020 one out of every two people in the U.S. will be older than 50. These older workers are willing to stay in the workforce longer or even reenter it after retirement. Yet most businesses continue to cater to rapidly diminishing younger workers. A survey conducted by the Society of Human Resource Managers shows 65 percent of companies surveyed exerted no effort to recruit older workers for open positions. Eighty-one percent did not have benefit plans designed with older workers in mind.

Employee Turnover

As the economy grows, employee turnover will rise significantly. A large portion of the workforce is getting ready to "abandon ship" as the economy improves. Employees are looking for better benefits, career advancement, and greater job satisfaction.

 

 



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