Labor Shortages Are Fueling America's Biggest Labor Crises

Labor Shortages Are Fueling America’s Biggest Labor Crises

Exhausted workers in education, health and rail industry retreat after months of staff shortages

Striking nurses demonstrate for better working conditions on public sidewalks outside Riverside Hospital September 13 in Minneapolis.
Striking nurses demonstrate for better working conditions on public sidewalks outside Riverside Hospital September 13 in Minneapolis. (Annabelle Marcovici for the Washington Post)

The U.S. economy ground to a halt hours after the shutdown due to a standoff between unions and rail carriers over sick pay and schedules, underscoring how staffing shortages have drastically reshaped workplaces. American workers and pushed exhausted workers back.

With more than 11 million job vacancies and only 6 million unemployed, employers have struggled for more than a year to hire enough people to fill their ranks. This mismatch has left employees frustrated and exhausted, and is fueling a new round of workplace power struggles.

While the rail dispute, which the White House helped resolve early Thursday, has garnered the most attention, a number of other strikes are spreading across the United States. Some 15,000 nurses quit their jobs in Minnesota this week, and healthcare workers in Michigan and Oregon recently authorized strikes. Seattle teachers called off a week-long strike, delaying the start of the school year.

At the center of each of these challenges are widespread labor shortages that have led to deteriorating working conditions. Staffing shortages in key sectors, such as healthcare, hospitality and education, have put unprecedented pressure on millions of workers, sparking a wave of labor disputes as well as new nationwide organizing efforts.

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Too many industries are still struggling to find workers. The share of working-age Americans who have a job or are looking for one is 62.4%, down one percentage point from February 2020, according to Labor Department data.

The reasons are complex and vast. Early retirements, a massive downturn in immigration that began under the Trump administration, and ongoing childcare and elder care challenges, combined with covid-related illnesses and deaths, have all reduces the number of available workers.

“We have about 2.5 million fewer people in the workforce than we were on track with pre-pandemic trends,” said Wendy Edelberg, director of the Hamilton Project at the Brookings Institution. “That’s a big number, and that means the people who are still here, who are still in those jobs, have to do even more.”

The stress of working an understaffed position plays a large role in worker grievances, which often revolve around staffing – or lack thereof. Seattle teachers wanted better teacher-student ratios in special education. Railroad conductors and engineers demanded sick leave. And nurses who stopped working in Minnesota said they were seeking more flexible hours and protections from retaliation for reporting understaffing.

“If you look at sectors like nursing homes, local schools, railroads — employment has dropped like a rock,” said Lisa Lynch, economics professor at Brandeis University and former chief economist. of the Department of Labor. “And with that, you see a marked increase in industrial action and strikes. People are tired and overworked.

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Although the US economy has officially recovered the 20 million jobs it lost at the start of the pandemic, the gains have been uneven. Significant gaps remain, particularly in low-wage industries that have lost workers to better-paying opportunities in warehousing, construction, and professional and business services. The hospitality and leisure industry has still lost 1.2 million jobs compared to February 2020. Public schools are short of nearly 360,000 workers and health care has yet to recover 37 000 posts. Rail transport, meanwhile, lost 12,500 jobs.

After months of juggling extra duties, Sabrina Montijo quit her job as a $19-an-hour Bay Area teacher’s aide in August. She now cares for her two young children full time and says she doesn’t know when she will return to work.

“Since the start of the pandemic, we were incredibly understaffed,” said Montijo, 33. “I had to work out of hours because no one was there. We couldn’t find staff and if we did, we constantly had to train someone, always had to start over.

Between the added pressure at work and the difficulty in finding affordable childcare, she says it made sense to leave. Coping with just one income from her husband’s job as a butcher at Safeway hasn’t been easy, but Montijo says it’s better than the alternative.

“It got to the point where I didn’t feel like I had a choice anymore,” she said. “I had to set up arts and crafts, do science projects, make phone calls and talk to parents, all at the same time. There are so many things one person can do.

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Worker burnout has become a persistent problem across the economy, although labor economists say it is particularly pronounced in sectors with severe labor shortages. Many frontline workers in retail, restaurants, education and healthcare who have worked throughout the pandemic – often putting their health and well-being at risk – say their jobs are becoming even more difficult as vacancies pile up.

Although employers across the economy say they are struggling to find and keep workers, labor shortages are most pronounced in retail (where around 70% of vacancies remain unfilled ), manufacturing (about 55%) and leisure and hospitality (45%). according to a U.S. Chamber of Commerce analysis of Department of Labor data.

“When you look at the jobs that are having a hard time hiring, it’s the ones that have very long hours, rigid schedules, low wages and limited benefits,” said Paige Ouimet, professor at Kenan-Flagler Business. School of the University of North Carolina. focuses on finance and labor economics. “Directing your employees like that – asking them to do 20, 30% more because you’re understaffed – it’s really a short-term strategy. You will continue to lose people.

In many cases, employers have started raising wages in the hope of attracting new workers. The largest wage gains were in the lowest-paying industries, such as hospitality, where average hourly wages rose 8.6% from a year ago. (That compares to a 5.2% increase for all workers.)

But while those wage increases may not go far enough to attract or retain workers, economists say they are contributing to inflation. Restaurants, airlines, health care companies and transportation providers are all charging more, in part, they say, due to rising labor costs.

Aveanna Healthcare, which provides home health care and palliative care services, is working with the Medicaid programs it works with to increase reimbursement rates to offset higher salaries for nurses.

“Inflation has pushed our workforce to seek employment that can and will pay higher wages,” Tony Strange, the company’s chief executive, said during an earnings call last month. “We need to increase caregiver salaries by an average of 15% to 25% in certain markets we serve. We will systematically go state by state and contract by contract and adjust reimbursement rates. »

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New inflation data released this week showed prices remaining stubbornly high, largely due to rising costs for services including healthcare and transport. Unlike the prices of televisions and furniture, which largely depend on the cost of materials and shipping, economists say services inflation tends to be closely tied to worker wages.

“It’s clear that the tight labor market drives wage growth, which leads to price growth,” said Jason Furman, an economics professor at Harvard University. “Services inflation tends to be much more persistent and much more difficult to bring down. Gasoline prices are very volatile. Property prices are somewhat volatile. But in services, if prices are high one month, they are likely to stay high the next month.

It’s unclear if — or when — many of the people who left the workforce during the pandemic will return. This is especially true for workers 55 and older, who stopped working at higher rates. The labor market still lacks more than 500,000 workers in this age group.

“There has been a very significant and persistent decline in labor force participation among workers over the age of 55,” said Edelberg of the Brookings Institution. “The pandemic has been a time of introspection and reassessment, and it has driven many people out of the workforce.”

Joseph White, who lives in Nashville, lost his job at the Guitar Center six months into the pandemic. But he says he had had enough: the store was constantly understaffed and the customers were intractable. In one case, a buyer pointed a gun at him for trying to enforce the company’s mask mandate.

“I’m tired, broken down, exhausted and old,” the 62-year-old said. “I worked to death for so long that finally, I said, there’s no way I’m coming back.”

He started dipping into Social Security payments to make ends meet and helps his wife run her little shop, Black Dog Beads. But White says he has no plans to re-enter the workforce.

“Our quality of life is much better even though we have less income,” he said. “I got tired of being a commodity.”

Lauren Kaori Gurley and Jeff Stein contributed to this report.

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