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In a surprising change of events since the recession, employees are finding that the workforce is more of a buffet. Employees can be picky in what they grab, take a bite, and if they don’t like it, abandon it without any notice. Why are business leaders facing this bad news and what is driving this tight market?
A Good Economy Means Lots of Jobs
Economic growth has made for many more open positions. In short, there are more open positions per month then there are people needing work and because of the booming economy, there would be even more open positions if there was a labor force to support them.
There are about twice as many people quitting today as there were in the recession. If you look at the reports, you will see that there are about 6 million open positions and only 3 million people leaving or quitting. Add to that the amount of baby boomers that are retiring and you have about twice as many open positions than there are qualified people to fill them.
Slow Population Growth Means Less Workforce
After World War II, there was a boom in population growth. We call this generation the baby boomers and that population is now entering retirement age. The problem is that with so many leaving the labor force, there is no one to fill their shoes.
The population of the United States has seen a decline with less immigration and a lower birth rate since the early 1970’s. By 2025, the population of working age people will be about 1/6 of what is was in 2000. With so many people retiring now and in the years to come, the labor market is only going to get worse.
Low Labor Force Participation Rate
A final factor contributing to today’s tight market is the amount of working age people who are not in the workforce. There are millions out there that are choosing to not work. Whether it is because they are living on mom and dad’s couch or they have found success working under the table, statistically speaking they are not available to help fill the labor needs.
What This Means for Business Owners
For at least the next ten years, we will continue to see this trend. The one way businesses can help alleviate their employee needs is to work on retaining the employees they currently have. Businesses need to work on keeping their workforce happy, loyal, and not easily enticed by another company.
The other thing businesses can work on is their recruiting efforts; to make their name one that sticks with potential employees. Your recruiter is the face of your company to the potential labor force. In an economy with literally millions of jobs, you want your company to stick in the minds of the relatively smaller labor force.
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