The Wall Street Journal today had an excellent article by Lauren Webber and Chip Cutter about the growing difficulty businesses are having filling open positions. The article covers things employers are doing such as reducing or eliminating background checks, not requiring a college degree and giving people with positive drug tests a second chance.
Employers and economists are divided over whether the changes are temporary. “When you have a labor market like this, it’s not uncommon for employers to start relaxing hiring requirements,” said Jason Tyszko, vice president of the U.S. Chamber of Commerce Foundation’s Center for Education and Workforce.
Wall Street Journal
Unfortunately, the article misses one core point of our economic view: demographics. In our second port of call, we took a look at the Bureau of Labor Statistics age distribution for current jobs out in the market place. We performed some basic analysis and concluded that there will be growing deficiencies in some areas as the US population ages and the largest population cohort, boomers (born between 1946-1964) retire. The boomer cohort will all reach age 65+ in the year 2030 which is just a short 8 years 2 months away at the time of this writing.
So where will there be potential job deficiencies?
Major deficiencies of workers
- Farmers, ranchers, and other agricultural managers
- Buyers and purchasing agents, farm products
- Clergy
- Judges, magistrates, and other judicial workers
- Library technicians
- Floral designers
- Musicians and singers
- Podiatrists
- Crossing guards and flaggers
- School bus monitors
- Hosts and hostesses, restaurant, lounge and coffee shop
- Other entertainment attendants and related workers
- Postal service workers (all kinds)
- Legal secretaries and administrative assistants
- Construction and building inspectors
- Tailors, dressmakers and sewers
- Drivers (bus, transit, school, truck)
- Motor vehicle operators
Minor deficiencies of workers
- Property appraisers and assessors
- Tax prepares
- Mathematicians
- Conservation scientists and foresters
- Astronomers and physicists
- Survey researchers
- Sociologists
- Court reporters and simultaneous captioners
- Models, demonstrators, and product promoters
- Gambling cage workers
- Brokerage clerks
- Credit authorizes, checkers and clerks
- Virtually all construction trades
Last year, Pew Research, found that because of Covid there were 3.2 million more people in retirement than occurred in the previous year pre-Covid. We suspect boomers that were on the edge of retirement or had passed the age of retirement but were still working likely reconsidered if they wanted to be potentially exposed to covid and the ravaging effects of the virus or opt to retire and stay home. Clearly, many more boomers decided to retire and the net impact of millions of people leaving the workforce began the creation of the labor “gap” we see today.
Further, according to Pew Research, the boomers cohort that retired in larger numbers were those will lower education levels than college educated.
The share of Boomers who have retired differs by educational attainment. Among those with no education beyond high school, the share is up 2 percentage points since February. There has been no change among those with some college education, and for those with a four-year college degree, the share is up 1 point.
Pew Research
There is no question about the present impact boomers are having to the job market and this problem will only get worse even in a post-covid world. We will keep you updated and plan our investment portfolios accordingly.