'Unprecedented Challenges': Labor Shortage to Impact World
Associated Press/The Wall Street Journal
"Serious labor shortages in the world's advanced economies will create unprecedented challenges for business leaders and policymakers over the next fifteen years and beyond." That startling announcement opened The Conference Board's recent report Growing Labor Shortages on the Horizon in Mature Economies.
The global research association surveyed 32 national economies, 266 industries and 464 occupations in the U.S. and 40 occupations in Europe. Of those studied, the research showed labor shortage risks in a majority of the occupations and nations in the next 15 years and beyond. The report focuses in on the growing number of Baby Boomers retiring, which should continue until around 2030, and the younger workforce's reluctance to take on these positions in America. At the moment the evidence is minimal, but occupations experiencing early stages of labor shortage aren't enacting 'early-warning systems' such as raising wages to counter the threat, said senior fellow at the Brookings Institution Gary Burtless to The Wall Street Journal.
Speed of employment growth and net number of new job-market entrants determined risk levels. In America, the report suggests that the labor shortage will 'cluster' around three key industries: Health-related, skilled labor and STEM (science, technology, engineering and mathematics) occupations. While the three sectors will be the focal point of concerns in America, other occupations like librarians and water transportation workers could be impacted as well.
America's outlook looks troubling. However, on a global scale the U.S. is only in moderate danger. The numbers show that Germany stands to be at the highest risk while surrounding central European nations face similar fates. In Asia, South Korea's high level of productivity places them at a lower risk. Yet Japan -- a nation already facing a narrow job market, the estimated loss of 1/3 of their population by 2060 and a growing elderly population -- faces an outcome similar to the Germans. In comparison, American labor shortage problems should resemble Canada, France and the United Kingdom.
The downside of a labor shortage usually means corporate growth will slow. With slow growth comes power for the jobseeker, as they are sure to be able to demand a higher wage for their much-desired skills. Only time will tell how true that will become.