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Why America Has a Long-Term Labor Crisis, in Six Charts

21 points by meany 3y ago

deleted 3y ago
[deleted]
jdkee 3y ago
See https://archive.ph/Ovs37 https://archive.ph/Ovs37
JumpCrisscross 3y ago
"Labor shortages can be eased by funneling more people into the labor force or making the current workforce more productive. That can be done through immigration; outsourcing more work overseas; tapping underutilized labor pools such as people with disabilities and the formerly incarcerated; and improving productivity through automation, training and refining business and production processes." Another underutilized labor pool: parents. Specifically, mothers. Universal childcare couldn't come quickly enough.
- toomuchtodo 3y ago
  Surprisingly, “paying existing workers more” didn’t make the list. Businesses are unhappy their margins are going to compress with the go forward cost of labor, and taxpayers are unhappy they’ll have to pay more to compensate workers providing government funded services (healthcare, education, schoolbus drivers, etc). The US has hit its “labor credit limit” and is cranky about it. Example: https://www.eastidahonews.com/2023/09/idahos-direct-care-workforce-is-in-crisis-state-legislative-panel-hears/ https://www.eastidahonews.com/2023/09/idahos-direct-care-wor... > The committee heard follow-ups to a February report issued by the Office of Performance Evaluations that found Idaho’s direct care workforce is short about 3,000 workers compared to national staffing levels. That report identified low pay as an issue for the program primarily paid by Idaho Medicaid, whose rates “do not support sustainable competitive wages for direct care workers,” and create a “wage cap,” the report found. The typical nursing assistant in direct care made $14.16 per hour and could earn 39% more by leaving direct care, the report said. There is no labor shortage, there is simply no longer surplus labor (due to covid deaths combined with structural demographics) enabling churn that kept wages low.
  - syndicatedjelly 3y ago
    > There is no labor shortage, there is simply no longer surplus labor (due to covid deaths combined with structural demographics) enabling churn that kept wages low. There are a number of mental hoops that one must jump through for this statement to make any sense. A lack of surplus labor is what exactly, if not a labor shortage? How is a high supply not the exact same thing as a labor surplus?
  - JumpCrisscross 3y ago
    > “paying existing workers more” didn’t make the list That falls under tapping underutilized labor pools. You're trying to take someone not working and convincing them to work. There's about 8% slack in labor-force participation to late-nineties peaks [1]. But per the article, some of that is retirement. It's not a long-term solution to rely on paying retirees to come back into the workforce. When an individual company (or state) faces a shortage of workers, it's often due to pay. Idaho should pay its nurses more. When an entire economy faces a shortage, it's something more structural. [1] https://fred.stlouisfed.org/series/CIVPART https://fred.stlouisfed.org/series/CIVPART
    - toomuchtodo 3y ago
      As long as there are workers 18-65 who are willing to work at a clearing price who aren't currently working because that price isn't offered, there is labor available. Agree relying on retirees to remain in the workforce isn't a long term solution; there is no long term solution when you've built your economy on an ever expanding labor force that is no longer ever expanding. The data does not show we are out of workers entirely, but there are jobs workers are unwilling to take at the current wage on offer. Will we face a structural labor shortage causing unreasonably low unemployment rates and labor marketplace friction in the near term? Very possibly depending on 55+ workforce exit rates and immigration flow. Are we there yet? I don't believe the data shows that.
  - junofan 3y ago
    It’s about proximity to the money printer unfortunately. Triffin dilemma. Like it or not, we’re not sending cash to nursing assistants in Idaho. If they wanted more money, they could’ve flipped houses in 2020–2022.
- friend_and_foe 3y ago
  Please god no. We went through this already, it halved wages and made single income households a luxury. I personally don't want some stranger raising my kids for me, I want it to be me and my wife doing it. I don't want to delegate rearing of my children to the state, looking at educational attainment in aggregate, they're really bad at it. I don't care about a labor crisis, I care about my family. If wages go up, good. You're not taking my wife and making her your secretary or putting her on a factory floor to keep my pay down.
  - JumpCrisscross 3y ago
    > I don't want to delegate rearing of my children to the state Okay? Then don't. Universal doesn't mean mandatory. Are you suggesting we should reverse womens' rights in the workplace so you can keep a particular family model? > If wages go up, good. Wages don't go up infinitely. They go up, then you run out of workers, and raising wages further doesn't bring more labour to the table. At that point, you cut services and increase prices to temper demand.
    - Danjoe4 3y ago
      Bad faith interpretation. Clearly there are benefits to having a parent dedicated solely to child rearing. I do not think a daycare is the optimal environment for child rearing. The issue here is not women's rights but the responsibility we have for our children.
      - JumpCrisscross 3y ago
        > Bad faith interpretation Sorry, I am having trouble finding a gentler parsing of "we went through this already, it halved wages and made single income households a luxury." To what does this refer to if not women entering the labour force? > do not think a daycare is the optimal environment for child rearing I don't either. But the choice isn't caring parents or daycare. It's the number of parents who feel forced by the cost of childcare into being reluctant parents. Or single parents in economic insecurity, or worse, forced negligence.
- WalterBright 3y ago
  > Universal childcare couldn't come quickly enough That requires more workers to care for the kids.
  - magicalhippo 3y ago
    Right, but at least here in Norway the rule[1] is that in kindergartens there should be one adult per three kids under 3 years old, and one adult per 6 kids above three years old. There's also requirements for pedagogical staffing so it works out to be a bit more than that, but not much. Following such a scheme, on average you free up more workers by sending kids to kindergarten. [1]: https://lovdata.no/dokument/NL/lov/2005-06-17-64/KAPITTEL_6#KAPITTEL_6 https://lovdata.no/dokument/NL/lov/2005-06-17-64/KAPITTEL_6#...
nine_zeros 3y ago
Labor exists, just not at the wages offered by employers. Unsurprisingly, none of the solutions involve lower share of income for execs and shareholders in favor of larger share for workers.
- JumpCrisscross 3y ago
  > Labor exists, just not at the wages offered by employers Source for the labor existing without immigration? There are tens of millions of people retiring compared to turning eighteen. Increasing pay should increase labor force participation a bit. But it doesn't solve the fundamental demographic problem.
  - gretch 3y ago
    Why does it have to be without immigration? GP didn't say that... Plenty of people want to come to the US btw, if you look at all the people coming over the southern border illegally. We just need programs to help those people do it legally, distribute them across the country (instead of concentrated in border states) and help them get acclimated to american culture.
    - JumpCrisscross 3y ago
      > Why does it have to be without immigration? The comment argues labour shortages are a fiction used to drive down wages. Immigration solves a labour shortage by driving down (or stabilizing rising) wages.
  - vegetablepotpie 3y ago
    If people are living with their parents later in life, and putting off purchasing housing because of cost [1] this could have non-insignificant impacts on successful courtship and reproduction. [1] https://www.businessinsider.com/millennials-living-at-home-as-an-adult-2023-1?op=1 https://www.businessinsider.com/millennials-living-at-home-a...
    - 3y ago
Animats 3y ago
All those charts look pretty good. “A carpenter now is making 20% to 25% more than they did 24 months ago, and that is not sustainable.” - some employer. This is a feature, not a bug. This is the usual employer whine. Can't get exactly the employee they want, right now, where they are, for what they want to pay, without investing in training or guaranteeing long term employment. World's smallest violin plays.
- ramblenode 3y ago
  > “A carpenter now is making 20% to 25% more than they did 24 months ago, and that is not sustainable.” - some employer. This is a feature, not a bug. If that holds true for the average employee then it's inflation, not a wage increase. In that case the losers are people paid in cash, which is most employees.
  - tuatoru 3y ago
    No, the losers are the people who are not employees: business owners mainly. Hence the whining and throwing of toys out of cots.
    - ramblenode 3y ago
      If prices keep up with inflation then the business owner is no worse off. They have most of their assets in the business, which is better than cash.
  - fakedang 3y ago
    The losers are people paid in startup equity while their CEO gallivants about as an "investor".
fred_is_fred 3y ago
Paradoxically the Republicans in this country hate both raising wages for workers and immigration. The result is a labor pool issue in the end.
- pauldenton 3y ago
  Almost like the Paradox of wanting open borders and higher minimum wages. The result being California, and the urban cores of Seattle, Portland, and Chicago

21 points by meany 3y ago

deleted 3y ago

[deleted]

jdkee 3y ago

See https://archive.ph/Ovs37 https://archive.ph/Ovs37

JumpCrisscross 3y ago

"Labor shortages can be eased by funneling more people into the labor force or making the current workforce more productive. That can be done through immigration; outsourcing more work overseas; tapping underutilized labor pools such as people with disabilities and the formerly incarcerated; and improving productivity through automation, training and refining business and production processes." Another underutilized labor pool: parents. Specifically, mothers. Universal childcare couldn't come quickly enough.

toomuchtodo 3y ago
Surprisingly, “paying existing workers more” didn’t make the list. Businesses are unhappy their margins are going to compress with the go forward cost of labor, and taxpayers are unhappy they’ll have to pay more to compensate workers providing government funded services (healthcare, education, schoolbus drivers, etc). The US has hit its “labor credit limit” and is cranky about it. Example: https://www.eastidahonews.com/2023/09/idahos-direct-care-workforce-is-in-crisis-state-legislative-panel-hears/ https://www.eastidahonews.com/2023/09/idahos-direct-care-wor... > The committee heard follow-ups to a February report issued by the Office of Performance Evaluations that found Idaho’s direct care workforce is short about 3,000 workers compared to national staffing levels. That report identified low pay as an issue for the program primarily paid by Idaho Medicaid, whose rates “do not support sustainable competitive wages for direct care workers,” and create a “wage cap,” the report found. The typical nursing assistant in direct care made $14.16 per hour and could earn 39% more by leaving direct care, the report said. There is no labor shortage, there is simply no longer surplus labor (due to covid deaths combined with structural demographics) enabling churn that kept wages low.
- syndicatedjelly 3y ago
  > There is no labor shortage, there is simply no longer surplus labor (due to covid deaths combined with structural demographics) enabling churn that kept wages low. There are a number of mental hoops that one must jump through for this statement to make any sense. A lack of surplus labor is what exactly, if not a labor shortage? How is a high supply not the exact same thing as a labor surplus?
- JumpCrisscross 3y ago
  > “paying existing workers more” didn’t make the list That falls under tapping underutilized labor pools. You're trying to take someone not working and convincing them to work. There's about 8% slack in labor-force participation to late-nineties peaks [1]. But per the article, some of that is retirement. It's not a long-term solution to rely on paying retirees to come back into the workforce. When an individual company (or state) faces a shortage of workers, it's often due to pay. Idaho should pay its nurses more. When an entire economy faces a shortage, it's something more structural. [1] https://fred.stlouisfed.org/series/CIVPART https://fred.stlouisfed.org/series/CIVPART
  - toomuchtodo 3y ago
    As long as there are workers 18-65 who are willing to work at a clearing price who aren't currently working because that price isn't offered, there is labor available. Agree relying on retirees to remain in the workforce isn't a long term solution; there is no long term solution when you've built your economy on an ever expanding labor force that is no longer ever expanding. The data does not show we are out of workers entirely, but there are jobs workers are unwilling to take at the current wage on offer. Will we face a structural labor shortage causing unreasonably low unemployment rates and labor marketplace friction in the near term? Very possibly depending on 55+ workforce exit rates and immigration flow. Are we there yet? I don't believe the data shows that.
- junofan 3y ago
  It’s about proximity to the money printer unfortunately. Triffin dilemma. Like it or not, we’re not sending cash to nursing assistants in Idaho. If they wanted more money, they could’ve flipped houses in 2020–2022.
friend_and_foe 3y ago
Please god no. We went through this already, it halved wages and made single income households a luxury. I personally don't want some stranger raising my kids for me, I want it to be me and my wife doing it. I don't want to delegate rearing of my children to the state, looking at educational attainment in aggregate, they're really bad at it. I don't care about a labor crisis, I care about my family. If wages go up, good. You're not taking my wife and making her your secretary or putting her on a factory floor to keep my pay down.
- JumpCrisscross 3y ago
  > I don't want to delegate rearing of my children to the state Okay? Then don't. Universal doesn't mean mandatory. Are you suggesting we should reverse womens' rights in the workplace so you can keep a particular family model? > If wages go up, good. Wages don't go up infinitely. They go up, then you run out of workers, and raising wages further doesn't bring more labour to the table. At that point, you cut services and increase prices to temper demand.
  - Danjoe4 3y ago
    Bad faith interpretation. Clearly there are benefits to having a parent dedicated solely to child rearing. I do not think a daycare is the optimal environment for child rearing. The issue here is not women's rights but the responsibility we have for our children.
    - JumpCrisscross 3y ago
      > Bad faith interpretation Sorry, I am having trouble finding a gentler parsing of "we went through this already, it halved wages and made single income households a luxury." To what does this refer to if not women entering the labour force? > do not think a daycare is the optimal environment for child rearing I don't either. But the choice isn't caring parents or daycare. It's the number of parents who feel forced by the cost of childcare into being reluctant parents. Or single parents in economic insecurity, or worse, forced negligence.
WalterBright 3y ago
> Universal childcare couldn't come quickly enough That requires more workers to care for the kids.
- magicalhippo 3y ago
  Right, but at least here in Norway the rule[1] is that in kindergartens there should be one adult per three kids under 3 years old, and one adult per 6 kids above three years old. There's also requirements for pedagogical staffing so it works out to be a bit more than that, but not much. Following such a scheme, on average you free up more workers by sending kids to kindergarten. [1]: https://lovdata.no/dokument/NL/lov/2005-06-17-64/KAPITTEL_6#KAPITTEL_6 https://lovdata.no/dokument/NL/lov/2005-06-17-64/KAPITTEL_6#...

nine_zeros 3y ago

Labor exists, just not at the wages offered by employers. Unsurprisingly, none of the solutions involve lower share of income for execs and shareholders in favor of larger share for workers.

JumpCrisscross 3y ago
> Labor exists, just not at the wages offered by employers Source for the labor existing without immigration? There are tens of millions of people retiring compared to turning eighteen. Increasing pay should increase labor force participation a bit. But it doesn't solve the fundamental demographic problem.
- gretch 3y ago
  Why does it have to be without immigration? GP didn't say that... Plenty of people want to come to the US btw, if you look at all the people coming over the southern border illegally. We just need programs to help those people do it legally, distribute them across the country (instead of concentrated in border states) and help them get acclimated to american culture.
  - JumpCrisscross 3y ago
    > Why does it have to be without immigration? The comment argues labour shortages are a fiction used to drive down wages. Immigration solves a labour shortage by driving down (or stabilizing rising) wages.
- vegetablepotpie 3y ago
  If people are living with their parents later in life, and putting off purchasing housing because of cost [1] this could have non-insignificant impacts on successful courtship and reproduction. [1] https://www.businessinsider.com/millennials-living-at-home-as-an-adult-2023-1?op=1 https://www.businessinsider.com/millennials-living-at-home-a...
  - 3y ago

Animats 3y ago

All those charts look pretty good. “A carpenter now is making 20% to 25% more than they did 24 months ago, and that is not sustainable.” - some employer. This is a feature, not a bug. This is the usual employer whine. Can't get exactly the employee they want, right now, where they are, for what they want to pay, without investing in training or guaranteeing long term employment. World's smallest violin plays.

ramblenode 3y ago
> “A carpenter now is making 20% to 25% more than they did 24 months ago, and that is not sustainable.” - some employer. This is a feature, not a bug. If that holds true for the average employee then it's inflation, not a wage increase. In that case the losers are people paid in cash, which is most employees.
- tuatoru 3y ago
  No, the losers are the people who are not employees: business owners mainly. Hence the whining and throwing of toys out of cots.
  - ramblenode 3y ago
    If prices keep up with inflation then the business owner is no worse off. They have most of their assets in the business, which is better than cash.
- fakedang 3y ago
  The losers are people paid in startup equity while their CEO gallivants about as an "investor".

fred_is_fred 3y ago

Paradoxically the Republicans in this country hate both raising wages for workers and immigration. The result is a labor pool issue in the end.

pauldenton 3y ago
Almost like the Paradox of wanting open borders and higher minimum wages. The result being California, and the urban cores of Seattle, Portland, and Chicago