Where Are the Workers?

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Unfinished interior.

 

Everyone we know, whether they are our venders or our interior design clients, all despair over the lack of workers. Nowhere are they in abundance. Almost every project is late due to the lack of them.

We decided to do a deep dive into the issue. If there is immediate solution, perhaps there are signs of hope? 

There are more job openings than there are workers to fill them. This is not a new problem. The government maintains a statistic called Labor Participation. It measures the number of workers available to work. Labor participation has remained steady or declined for a long time. We are just now noticing it because companies need to fill more jobs than there are people to fill them. Most of the workers who are willing to work have jobs. 

Fewer people in the US are willing to work. Labor participation is low. That's why it's so hard to get anything done.

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Chart of labor participation rate.

Chart from Bloomberg

 

Why?

There is no simple answer. Here are some of the reasons why people are not participating in the US Labor pool and thus why you can't get anything done.

Side hustles

During the Pandemic people decided that they would rather work their own hours  The greatest example is Uber driving. People are making a regular income from irregular jobs.

Drugs

It is estimated that 44 percent of the men have dropped out of the labor force because of opioids. This is sad.

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Chart of opioid deaths

 

Child Care

During the Pandemic, schools closed and parents were forced to find alternative ways to take care of their children. Mostly likely mothers quit work and stayed at home with their children. Perhaps these moms liked it better at home and figured out ways to get by.

 

Take This Job and Shove It

Workers are quitting jobs in record numbers. Why? Because they know that employers are desperate for workers, and jobs are easy to get.

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Chart of worker quit rates.

Heratage Foundation

 

Government programs

Although most of the super unemployment programs that paid many people more to stay at home than to work have expired, there are still ways to get governments to subsidize unemployment. For example, according to Bloomberg, the share of working-age Americans claiming Social Security Disability Insurance has roughly doubled in the past half-century, from 2.2% in 1977 to 4.3% last year. Local governments have a financial incentive to classify people as disabled because they then become the federal government’s responsibility.

In addition, record numbers of the baby boomer generation are retiring.

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Annual increase in retired baby boomers.

From Bloomberg

 

Long term problem

These and others are structural issues and will take time to resolve.

Workers are needed everywhere in our businesses: painters, carpenters, plumbers, tilers, carpet installers, etc. etc. The absence of even one worker places a strain on our small businesses.

We are all in this together. We can work together to be realistic about expectations with our clients and be open-minded and creative finding work-arounds to keep service standards high. We are open to any and all ideas.

Thank you for being a customer of Addison/Dicus &Bailey!

Mike Bailey
Drew Dicus

 

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