Navigating a labor shortage

Navigating a labor shortage

Explore the state of the U.S. workforce and the top strategies to overcome labor shortages

While the nation has consistently hit lower unemployment rates in recent years, multiple industries continue to experience persistent labor shortages. Navigating ongoing workforce challenges is proving to be a daunting task for some employers. Whether your business is facing unpredictable surges in demand or difficulties in finding the right talent, shortages can lead to significant operational interruptions.  

Read on to learn the strategies that organizations can implement to effectively manage and mitigate the impact of workforce shortages.  

What to do when there is a labor shortage

The state of the US workforce today 

The global pandemic coupled with the mass exodus of employees from their positions, known as the Great Resignation, caused major disruptions in America’s labor force. During this time, 47.8 million people quit jobs in 2021, and more than 50 million workers left their roles the following year, according to Statista. The consequences of these challenges continue to impact organizations across industries.  

As of August , the U.S. Bureau of Labor Statistics reports the unemployment rate rose by a .03 percentage point to reach 3.8% — with the number of unemployed persons increasing by 514,000 to 6.4 million. Although this rate is generally considered low, when it comes to workforce shortages, the country isn’t out of the woods just yet. In fact, recent increases and persistent labor shortages are indicative of a tottering economy.  

 

What industries are struggling most with labor shortages? 

Recent market reports indicate that leisure and hospitality are specifically experiencing the biggest shortage of workers — down 349,000 people

The U.S. Chamber of Commerce reveals that there are more unfilled job openings in the durable goods manufacturing, wholesale and retail trade, education, and healthcare industries than there are unemployed workers in these fields. 

 

Which states are experiencing ongoing workforce challenges? 

While it’s clear that some industries are facing more severe labor shortages than others, the same can be said for workforce shortages across different states. The U.S. Chamber of Commerce has identified 13 states that have been particularly impacted by the nation’s continued labor shortages: Alabama, Arkansas, Maine, Maryland, Massachusetts, Montana, Nebraska, New Hampshire, North Dakota, South Dakota, Utah, Virginia and Vermont.  

Factors contributing to ongoing labor shortages 

For organizations that are curious about the underlying reasons behind continued workforce challenges, there are several that have considerable influence over the market: 

  • Changing demographics: As the working population ages and retirements increase, the available workforce across industries naturally shrinks — especially if there isn’t enough new labor to take over their roles.  
  • Skilled labor shortages: High-demand sectors, such as healthcare, manufacturing, and technology, are struggling to find talent with the specific skills needed for open positions.  
  • Flexible work preferences: Employees and job seekers alike are pursuing more flexible work opportunities, in terms of scheduling and location, to improve their work-life balance and mental health.  
  • Competitive compensation and benefits: With multiple industries combatting workforce shortages, companies are offering more competitive salary packages and benefits to attract and retain talent more effectively, making it more challenging for other teams to fill positions.  

 

What are the consequences of unaddressed workforce shortages? 

When labor shortages go unaddressed, businesses will feel the repercussions. Understaffed teams often result in increased workloads and stress for existing employees, leading to decreased job satisfaction, a higher likelihood of turnover, and greater difficulty in reaching qualified talent moving forward. This cycle of ongoing churn is a detriment to productivity and organizational ability.

6 strategies to overcome workforce shortages and attract talent 

To effectively address the challenges posed by continued understaffing, organizations must strengthen their recruitment and retention efforts.  

1. Optimize your onboarding experience 

A well-structured and welcoming onboarding process sets the tone for a new hire’s journey with your organization. When it is well done and positive, onboarding has a direct link to long-term retention.  

A comprehensive onboarding program provides new employees with the necessary tools, resources, and information to integrate smoothly into the company. This might include setting up access to company systems in advance or assigning them a mentor to guide them as they get acclimated.  

 

2. Improve your workforce management and recruitment techniques 

To attract the right talent amid labor shortages, organizations should reassess their approach to workforce recruitment and management. Teams can turn to staffing partners, like Employbridge, and cutting-edge technology to streamline the recruitment and management process to help identify suitable candidates faster and provide ongoing management support.  

 

3. Offer ongoing training and career development opportunities 

Employees are increasingly seeking opportunities for growth and development in their respective roles and careers. In fact, 46% of workers are willing to put in five or more hours a week to learn a new skill, according to The Voice of the American Workforce Survey – the nation’s largest survey of the hourly workforce. 

Companies can demonstrate a commitment to employee development by offering opportunities for specialized training and certifications. By providing clear development paths, workers are more likely to see a future within the organization.  

 

4. Make room for flexibility 

For many individuals, the global pandemic signaled a considerable change in priorities, highlighting the importance of workplace flexibility as a result. Considering where your organization has room to offer more flexible scheduling or remote work accommodations can go a long way toward attracting and retaining top talent — especially among younger demographics that highly value a work-life balance.  

 

5. Boost workplace communication  

Effective communication is the cornerstone of a healthy workplace, supporting satisfied workers who are likely to stick around. You can encourage open, transparent, and constructive communication channels within your organization through regular feedback sessions, company-wide meetings, or even something as simple as an anonymous suggestion box. This is critical to ensure employees feel free to voice their concerns, ideas, and opinions.  

 

6. Recognize and reward employees frequently and consistently 

Employee recognition continues to be a powerful tool for retaining talent, helping boost team morale and overall job satisfaction. Organizations can establish a program, ranging from public recognition to monetary rewards, to foster a sense of pride and motivate employees to stay with the company.  

Combat labor shortages with workforce-as-a-service solutions 

If you’re wondering when workforce shortages will end, the short answer is that no one knows for sure. It will ultimately depend on several factors, from economic conditions and shifting demographics to workforce preferences and industry-specific demands.  

While labor challenges continue, Employbridge stands out as a reliable staffing partner, providing teams with years of industry expertise and a cutting-edge workforce-as-a-service solution, powered by Bluecrew. Our extensive experience and innovative technology empower organizations to effectively navigate staffing issues. This includes helping you access high-quality talent in less time, improve placement rates, and enhance your long-term workforce management.