unemployment – Workforce

April 27, 2023February 16, 2024

Labor Shortage Statistics & Trends (2023)

Summary

If all the unemployed people in the United States of America were to find a job right now, there would still be over 4 million jobs left to fill. — More
Labor force participation is 1% lower than pre-pandemic levels or about 2.9 million fewer workers. — More
Lower-paid industries — like wholesale and retail — have been most affected by the labor shortage crisis. — More
You can use a workforce management solution to make your organization more agile in times of worker shortages. It can be used for things like labor forecasting, scheduling, employee engagement, and cross-training. — More

Last year, an impressive 3.8 million new jobs were added to the American market as businesses started to recover from the effects of the COVID-19 pandemic. Despite this, labor force participation remains below pre-pandemic levels. There are nearly 3.4 million fewer American workers now than in February 2020 in an epoch that has been dubbed The Great Resignation.

According to the latest information from the U.S. Bureau of Labor Statistics (BLS), the total number of nonfarm payroll employment increased last month by 263,000. The unemployment rate also decreased to 3.5% as 5.8 million workers were registered as being out of the labor market in September.

When companies better understand the current statistics surrounding the labor market, they can adapt to stay afloat during the labor shortage. With workforce management tools like smarter scheduling and labor forecasting, companies can find smarter ways of working around short-staffing situations.

Here’s what the latest stats tell us about the labor shortage crisis

There’s a higher number of job openings than there are people in the job market

Even if all unemployed people in the United States were to find a job today, there would still be over 4 million jobs to fill. The U.S. Chamber of Commerce highlighted that there are currently 10 million unfilled jobs but only 5.8 million people unemployed.

By comparison, in February 2020, there were also 5.8 million unemployed workers and 6.9 million job openings.

Labor force participation is lower than pre-pandemic levels

Currently, labor participation in the United States is at 62.3%, which is 1% lower than it was in February 2020. Labor force participation refers to anyone who is currently working or actively looking for work. The 1% decrease in participation rate amounts to 2.9 million fewer workers contributing to the US economy.

According to research by the U.S. Chamber of Commerce, there are different reasons for this drop in participation:

More women are staying home to take care of dependents.
There’s a lack of “good jobs.”
There are remaining safety concerns linked with COVID-19.
Salaries are considered to be too low.
People are focusing on acquiring new skills or education before re-entering the job market.
People have more money saved since the pandemic and can afford to stay out of work a bit longer.
The pandemic drove a lot of people into early retirement – over 3 million older workers as of October 2021.
More people have started their own businesses. In 2021, a record high 5.4 million new businesses were opened.

The labor shortage has affected different industries differently

Lower-paid industries have historically been most affected by the labor shortage crisis. The most affected industries are wholesale and retail trade, durable goods and manufacturing, and leisure and hospitality.

According to the September 2022 BLS employment situation:

The leisure and hospitality sector added 83,000 jobs. Employment rose in food services and drinking places by 60,000. The sector is still experiencing a labor supply below pre-pandemic levels by 1.1 million or 6.7%.
The healthcare industry welcomed 60,000 new workers last month, finally returning to its pre-pandemic level last seen in February 2020.
Professional and business services are experiencing an upward trend in hiring rates. The sector currently has an average job growth of 72,000 per month this year.
Other industries experiencing upward trends include manufacturing (22,000), construction (19,000), and wholesale trade (11,000).

How to stay ahead during a labor shortage

There are many ways to utilize workforce and scheduling software to make your operations run smoothly during a labor shortage.

1. Utilize labor forecasting

Labor forecasting helps you estimate consumer demand, allowing you to schedule shifts to match it. With demand-based scheduling, you avoid under or overstaffing. Your employees are also less likely to burn out and, ultimately, quit.

Luckily there is an easy way for businesses to schedule like this.

Labor forecasting software allows you to look at historical sales, foot traffic, weather, and economic trends to better determine the amount of labor you’ll need to schedule to meet upcoming demand. This leads to smarter scheduling, such as utilizing your most experienced employees during busier periods for increased efficiency.

2. Stay ahead of your scheduling

Scheduling your shifts in advance allows you to be more agile and adaptable. It gives your employees enough time to review and make any changes needed without causing any major, last-minute disruptions. In turn, they have a better work-life balance and can fully focus on the job when they’re on the clock.

Employee scheduling software centralizes scheduling and provides standardized methods for shift swaps and replacements, increasing administrative efficiency and staff agility. It also helps you manage time off requests in a way that ensures you have enough employees to cover demand.

Workforce.com’s scheduling software also incorporates breaks into work schedules. This way, you make sure your staff is taking the breaks they need to remain engaged and productive. Breaks are also automatically included to remain legally compliant with federal and state laws.

Webinar: How to Schedule While Understaffed

3. Keep your employees engaged

Happy and engaged employees are less likely to leave. Use communication and feedback tools to boost engagement, retention rates, and healthy production levels.

Communication tools allow for quicker and more transparent updates and make it easier to share important company announcements. This way, employees feel valued, and it helps to bridge the gap between them and management.

Feedback is an essential part of making your employees feel more appreciated. You can use shift feedback tools to cover various aspects of shift performance. Shift feedback tools work both ways – employees receive valuable feedback from management, but they are also able to provide feedback on things like staffing-level issues.

Webinar: How to Retain Hourly Employees

4. Cross-train your staff

Cross-training ensures that your employees can deal better with short-staffing challenges. Your staff can handle a wider range of tasks and are therefore more adaptable. By encouraging your staff to mentor and train each other, you also create more cohesion across the company.

To start, create a list of all your team members and the skills they currently have. From there, build a cross-training program that incentivizes staff members to learn from each other and progress as individuals.

Employees who are cross-trained can fill in for each other during times of short-staffing and emergencies.

See how Workforce.com can help you adapt to labor shortages

Workforce.com can better equip your organization to deal with the ongoing country-wide labor shortages. Features like labor forecasting, smart employee scheduling, and shift feedback tools will not only help you handle short-staffing situations but will also improve your operations long term.

To learn more about how Workforce.com can help you stay ahead during labor shortages, schedule a call or start a free trial today.

May 5, 2020June 29, 2023

One state is encouraging employers to report AWOL employees to unemployment agency

technology; workplace communications; internal communications

Last week I asked how employers could encourage employees to return to work when unemployment benefits pay them more than their jobs.

One suggestion I offered was to hit employees with the stick of unemployment-benefit termination.

Employees who refuse return-to-work offers might be disqualified from collecting further unemployment benefits (unless their refusal is because of coronavirus), and you can advise employees that refuse a recall that you will be asking the state to terminate their benefits.

Late last week, the state of Ohio provided a clear reminder to employers of the validity of this threat.

According to cleveland.com, “The Ohio Department of Job and Family Services has set up a webpage – and sent emails to employers Friday night – telling them to report workers who don’t return so they can get reevaluated and potentially lose unemployment benefits.” That email says in part:

Ohio law prohibits individuals from receiving unemployment benefits if they refuse to accept offers of suitable work, or quit work, without good cause. …

If you have employees who refuse to return to work or quit work, it’s important that you let the Ohio Department of Job and Family Services (ODJFS) know so we can make accurate eligibility determinations.

Employers are then encouraged to visit https://secure.jfs.ohio.gov/covid-19-fraud/ to report their AWOL employees.

As for employees who refuse to return to work over safety concerns? ODJFS says that if a reasonable person would not feel safe returning to work to that employer, an AWOL employee still might qualify for benefits.

Non-essential businesses have begun to reopen in Ohio. Employers, you need to be 100 percent transparent about the steps you are taking and measures you are implementing to help keep your employees as safe as possible from contracting COVID-19 at work. Otherwise, you risk a mass exodus, and employees might opt for unemployment over the jobs you offer them.

April 27, 2020June 29, 2023

Bringing your employees back to work when unemployment pays them more than you do

At 2 p.m. on Monday, April 27, Ohio Gov. Mike DeWine will announce his plan for restarting Ohio’s economy (currently expected to begin May 2).

One huge issue is how businesses can motivate their employees to return to work if unemployment is paying them more than you will.

Including the CARES Act’s $600 unemployment bonus that expires July 31, an employee earning maximum unemployment benefits from the state of Ohio earns $1,247 per week, the equivalent of an hourly rate of $31.17 or a yearly salary of nearly $65,000. My guess is that most of your employees do not earn this much. It’s one of the worst unintended consequences of the CARES Act — employees are making more money unemployed than they did employed.

Thus, how do you incent your employees to come off unemployment and return to work, either because you are reopening or you need to end their furlough? You can either use the stick or the carrot.

The stick? Employees who refuse return-to-work offers might be disqualified from collecting further unemployment benefits (unless their refusal is because of coronavirus), and you can advise employees that if they refuse a recall that you will be asking the state to terminate their benefits. You can also advise that with unemployment at record-high numbers, there are plenty of people waiting to fill their jobs, and there is no guarantee a job will be waiting for them when the CARES Act’s $600 expires at the end of July.

The carrot? Employees might need a financial incentive to come off unemployment and return to work. Temporary hazard pay? A return-to-work incentive bonus? A longer-term retention and/or attendance bonus for employees who report by a certain date and remain employed through Dec. 31 (or some other target date)? The possibilities are endless, but the reality is that certain employees will need some amount of financial incentive to come back to work.

Which tool you use will depend on which you think will best motivate your employees and your financial ability to pay for the carrot. You may have to do something, however, as this reality is that some (many?) of your employees might be too short-sighted to realize that a job in the long-term is better than few extra dollars in the short-term.

I’ll be discussing this and other issues related to restarting your business in the world of coronavirus, Tuesday, April 28, at 11 a.m. on Zoom. Pre-registration is required, and space is limited: https://us02web.zoom.us/meeting/register/tJYvdumpqjgiGdCQ3TtYZpmSsIpugmdQhTCs

April 6, 2020April 6, 2020

Coronavirus Update: We CARES about unemployment

The past two weeks have seen a record 10 million new unemployment claims. This number does not even include many of the millions more who have had their hours or wages cut as businesses continue to struggle with the realities of operating in a world turned upside down by coronavirus. Sadly, we should expect this situation to get a lot worse before it starts to get better.

Thankfully for each worker unemployed or underemployed as a result of coronavirus, the CARES Act provides significant financial relief. It contains the following seven unemployment expansion and enhancement provisions.

1. Pandemic Unemployment Compensation (FPUC) — This program provides funding for an additional $600 per week in unemployment benefits through July 31, 2020, for any individual who becomes unemployed, partially unemployed, or unable or unavailable to work or telework because of any of the following coronavirus related reasons:

- The individual has been diagnosed with coronavirus or is experiencing symptoms of coronavirus and seeking a medical diagnosis.
- A member of the individual’s household has been diagnosed with coronavirus.

- The individual is providing care for a family member or a member of the individual’s household who has been diagnosed with coronavirus.

- A child or other person in the household for which the individual has primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of the coronavirus public health emergency and such school or facility care is required for the individual to work.

- the individual is unable to reach the place of employment because of a quarantine imposed as a direct result of the coronavirus public health emergency.

- The individual is unable to reach the place of employment because the individual has been advised by a health care provider to self-quarantine due to concerns related to coronavirus.

- The individual was scheduled to commence employment and does not have a job or is unable to reach the job as a direct result of the coronavirus public health emergency.

- The individual has become the breadwinner or major support for a household because the head of the household has died as a direct result of coronavirus.

- The individual has to quit his or her job as a direct result of coronavirus (which one could interpret as covering employees who quit out of fear of contracting coronavirus).

- The individual’s place of employment is closed as a direct result of the coronavirus public health emergency.

Additionally, this program contains a non-reduction rule, which prohibits states from changing how they compute regular unemployment benefits to reduce the average weekly benefit amounts or the number of weeks of benefits payable to impacted employees.

In Ohio, this means that a minimum wage employee with no dependents would see his weekly unemployment benefit increase from $171 to $771 (an annualized salary of $40,092), and an employee with three dependents maxed out on unemployment would see his weekly benefit increase from $647 to $1,247 (an annualized salary of $64,884).

Because of this substantial increase, I am worried that many employees will decide that they are better off (either financially or for health-related reasons) quitting their jobs and collecting unemployment, leaving essential employers with huge labor gaps to fill to maintain basis minimum operations. For this reason, essential employers should be communicating with their employees on a daily basis about all of the steps they are doing to ensure, as best as possible their employees’ health and safety.

2. Pandemic Unemployment Assistance (PUA) — This program provides unemployment compensation through December 31, 2020, for individuals who are self-employed, seeking part-time employment, or who otherwise would not qualify for regular unemployment benefits because of one of the above-listed coronavirus related reasons.

3. Emergency unemployment relief for governmental entities and non-profit organizations — This program provides federal reimbursement of state unemployment payments made to governmental entities and non-profit organizations through December 31, 2020, regardless of whether the unemployment claim is related to coronavirus.

4. Temporary full federal funding of the first week of compensable regular unemployment for states with no waiting week — Through December 31, 2020, states that waive any waiting periods and provide unemployment benefits to applicants during their first week of unemployment will receive 100 percent federal funding for benefits paid during that initial week.

5. Emergency state staffing flexibility — States as provided flexibility through December 31, 2020, to modify their unemployment compensation laws and policies with respect to work-search requirements, waiting weeks, good cause standards, and employer experience rating. Ohio, for example, has eliminated its work-search requirement and waiting periods, and is not counting coronavirus related unemployment claims against an employer’s experience rating.

6. Pandemic Emergency Unemployment Compensation (PEUC) — This program provides up to 13 weeks of additional unemployment benefits through December 31, 2020, for individuals who have exhausted all rights to regular unemployment compensation under state or federal law or have no rights to regular unemployment compensation under any other state or federal law. The law requires individuals seeking PEUC benefits to be able to work, available for work, and actively seeking work. States, however, are required to offer flexibility in meeting the “actively seeking work” requirement for individuals unable to search for work because of coronavirus, including illness, quarantine, or movement restrictions.

7. Temporary financing, agreements, and grants for Short-Time Compensation (STC) — This program provides pro-rated unemployment benefits for up to 26 weeks through December 31, 2020, to employees who have had their hours reduced in lieu of layoff.

January 27, 2009March 25, 2020

Stimulus Bill Includes Unemployment Insurance Update

The country’s 74-year-old unemployment insurance system could be getting a face-lift soon.

As part of the economic recovery package making its way through Congress, the federal government would boost jobless benefits this year by $25 per week as well as spend billions to encourage states to modernize their unemployment insurance programs.

Economic stimulus legislation approved last week by the House Ways and Means Committee would give states incentives to make it easier for part-time workers to qualify for unemployment benefits and provide benefits to people leaving work for a “compelling family reason.” That bill was slated to be folded into the broader American Recovery and Reinvestment Act for consideration by the full House this week.

The sweeping $825 billion legislation reflects priorities outlined by President Barack Obama, who hopes to sign a recovery plan into law within a month.

Changes to unemployment insurance woven into the package can’t come too soon for observers who say the nation’s safety net is showing its age. At a time when legions of Americans are losing their jobs and the economy is teetering, critics say the jobless benefits program is fraught with problems, including inadequate funding, skimpy benefit payments and fusty eligibility requirements that haven’t evolved with the workplace.

An update to the system is a win-win for workers and employers, says Rep. Jim McDermott, D-Washington, who has been a leading advocate for unemployment insurance reforms.

“We can’t adequately help the unemployed and our economy just by pumping resources into an unemployment program that is not designed for today’s crisis,” McDermott said in a statement this month. “When we enable more unemployed workers to qualify for the unemployment insurance program, we put cash into the pockets of struggling families who will spend this money in their communities, supporting local jobs and businesses.”

Others are wary of efforts to overhaul the unemployment insurance program, which took shape in 1935 as part of the New Deal. Calls for higher funding levels and bigger benefit checks eventually could mean tax increases on businesses. And not everyone likes the modernization legislation, partly because provisions in it blur the line between jobless benefits and social welfare policy.

The original purposes of unemployment insurance are diluted by giving someone unemployment benefits when they leave work to care for a family member, says Larry Temple, executive director of the Texas Workforce Commission. “This isn’t a social services program,” says Temple, whose organization runs unemployment insurance in Texas. “It’s not a welfare program.”

The debate over unemployment policy has taken on greater urgency because of the recession. Some 1.9 million U.S. payroll jobs were lost during the last four months of 2008, and the unemployment rate rose to 7.2 percent in December. The amount of time people remain out of work also is growing, from an average of 16.5 weeks in December 2007 to 19.7 weeks in December 2008.

Droves of Americans are applying for unemployment insurance benefits, which are available to workers who are unemployed through no fault of their own and meet eligibility requirements set by states. For the week ending December 27, continued claims—that is, the number of people requesting a weekly benefit check after having established eligibility—topped 4.6 million, the most since 1982. For the week ending January 10, the preliminary figure for continued claims was slightly lower but still more than 4.6 million.

Among other things, the American Recovery and Reinvestment Act includes $27 billion to continue the current extended unemployment benefits program—which provides up to 33 weeks of extended benefits—through 2009.

In addition, the legislation approved by the Ways and Means Committee would give $7 billion in incentive payments to states that have, or would adopt, certain features in their unemployment insurance programs. Chief among the reforms specified in the act is use of an “alternative base period.” This is designed to get states to consider a person’s earnings in the most recent completed quarter when determining eligibility—which can help lower-wage workers qualify for benefits.

For a state to obtain additional incentive funding under the measure, its unemployment law would need at least two provisions from a list of other reforms. The possibilities include allowing people seeking part-time work to qualify for benefits and not disqualifying individuals from jobless benefits if they’ve left work for a “compelling family reason,” including cases involving domestic violence and the illness or disability of a member of the individual’s immediate family.

—Ed Frauenheim