Understanding Georgia’s Labor Shortage Crisis

It’s no secret. Our nation is facing a labor shortage crisis unlike anything we have ever seen. COVID-19 has shifted the way we approach our jobs and how we prioritize our lives. Just this week, Commissioner Mark Butler with the Georgia Department of Labor shared that despite a 300% increase in those who gained employment in July over June of this year, businesses are still struggling to find workers due to numerous factors including a shift in priorities and mindset. In essence, COVID-19 has recalibrated society as we know it. Workers are scarce in nearly every industry, from service and hospitality to manufacturing, construction, agriculture and even office jobs. But to understand the long-term impacts of today’s crisis, we must examine the causes of this growing talent shortage.

First, the immediate short-term labor crisis was spurred by federal and state unemployment benefits that often paid workers more than they could make during a typical 40-hour work week. Additional benefits like healthcare and child tax credits buffered that unemployment check and delivered the essential income needed for many to survive the crush of the pandemic recession. Requiring beneficiaries to seek employment and helping improve their skill sets has underlined Georgia’s efforts and we’re seeing some improvements.

Second, changes to H-1B, H-2A and H-2B visas over the last 4 years have greatly reduced the number of technology and agriculture workers that normally fill high demand or seasonal jobs. It doesn’t help that our farmers have been especially hard hit with the increased production costs due to the pandemic. Federal changes to legal immigration could ease this shortage.

Third, what many labor experts are calling the “Great Resignation” predicts that 25% of most workforces will resign in the coming 6 to 12 months. Talent churn happens annually but with so few resignations in 2020, there’s a year and half of turnover back-up within the system. The good news is that innovative employers can mitigate this outcome by listening to their team members and adapting their business models to harness the power of tomorrow’s opportunities.

Fourth, we are seeing a downturn in the experience gained by high school and college-age workers filling jobs in retail, fast food, and restaurant industries. The demands of testing, extracurricular activities to qualify for scholarships, dual enrollment and a thousand other factors make it rare to see teenagers serving you. To add, 60% of Georgia’s jobs of the future need post-secondary certification or degrees, and many of today’s generation used the halt of COVID to update their certifications, finish their degrees and seek higher skill jobs. And now, they aren’t returning to entry level jobs they once filled.

Another looming concern, COVID has also expedited retirement planning by Baby Boomers in the Peach State. We had expected over one-million retirees by 2025, which was slated to cause severe labor shortages. But many sped up their retirement timelines and we’re likely to see more retirements as COVID continues. In response, many innovative firms are developing a new category of shared-jobs and creating more part-time positions to attract senior workers back from retirement.

Long term, A.I. and robotics are predicted to eliminate half of today’s jobs. However, those jobs will be replaced with over 6 million high-skill STEAM jobs that require varying educational certificates and degrees. This rapid shift in skills’ demand was accelerated by COVID and will come to full fruition by the end of this decade.

Today’s crisis is producing a long-term economic challenge. But the Georgia Chamber and our local chamber partners have a history of developing proactive and forward-thinking policies to support the building of next-gen talent. As we look at the coming 5 to 8 years, we believe quickly and appropriately addressing this issue will define Georgia’s economic prosperity for a decade, perhaps even longer. Through the Chamber’s Smart Decisions program and Global Talent Initiative, we are educating businesses on the ways in which we can harness untapped, unpopular, and often dismissed pools of talent; populations that can raise the tide across the socio-economic landscape of our state and country, if properly integrated.

As business community members, we must all revisit our benefit programs, consider what our employees need and want to be more productive in our places of work, invest in professional development, focus on equality and inclusion within our own cultures, and identify what technology can do to shape our workforce for tomorrow. We are in this together, and for the long haul. So, let’s expand our thought processes, innovate strategies for the future, and work together to reimagine a new Georgia economy.

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Authored by Chris Clark, President & CEO, Georgia Chamber

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