Balades en expertise :
Labour Shortage

Actu Anglais septembre 2022

Labour Shortage... décrypté par Jean-François Allafort, co-auteur des Fiches DCG UE12 Anglais des affaires, collection « Expert Sup », Dunod, et présenté par Ian Waddelow.

#LabourShortage #Covid-19 #Brexit #Migrants #MentalHealth #Burnout #Flexibility #JobOpportunities

Labour Shortage

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As markets begin to stabilize and production levels are slowly rebounding to pre-pandemic levels, companies from around the world have yet another challenge to navigate : the ongoing shortage of workers.

In fact, studies show that by 2030 there will be an estimated shortage of 85 million workers worldwide.

Typically, a labour shortage occurs when the demand for employees outstrips the supply. For example, in the United States, there are nearly 11 million job vacancies, but only 6.5 million workers are listed as unemployed in 2022.

The industries hit hardest are leisure and hospitality—including the arts and entertainment, as well as in restaurants, hotels, trade, transportation, utilities, professional services and retail.

It’s an immense challenge. But what are the causes ?

Well, it would be impossible to discuss the current labour shortage without acknowledging the role of Covid-19 in it. As of March 2022, WHO has reported more than 6 million people deceased due to pandemic-related issues, while millions of others are dealing with the long-term effects of the virus.

Early into the pandemic, mental health professionals started to express concerns regarding the impact on workers’ mental health. The current labour shortage is driven by burnout. Today, it looks like these warnings are proving true. The U.K.’s Office of National Statistics reports that one-half of the over 400,000 employees who left the workforce between February 2020 and November 2021 did so due to long-term mental health issues.

Another reason is migrants’ disruption. Migrant workers make up 5% of the global workforce and countries such as the United States, Saudi Arabia, United Arab Emirates, Canada, Germany and the United Kingdom depend heavily on these workers to meet production demands. The pandemic significantly hindered this dependency as countries set stricter immigration policies to control the spread of the virus within their borders. In the UK, the combination of COVID and Brexit caused immigration rates to fall by 90% in 2020.

There is also a shift in workers’ expectations. Today employees are looking for greater flexibility, remote working options, flexible schedules, additional paid time off, and greater autonomy to set their own workloads and schedules.

Furthermore, some workers are willing to change jobs to receive the flexibility they need or they leave the workforce altogether if they can’t find it. A recent study by Monster shows that 95% of workers are open to changing jobs, and 92% are willing to change industries if necessary.

While some workers are leaving the workforce altogether, the majority are simply changing jobs to find better job opportunities. Some are leaving for higher salaries and according to Randstad their
brand research says that 62% of workers around the world rank salaries as the strongest motivator for changing jobs. This phenomenon is often referred to as the Great Resignation.

Another factor impacting today’s labour shortage is the world’s ageing population. For years, employers in many countries have had concerns about replacing record numbers of retiring workers. In the United States alone, 10,000 people per day reach the 65-year-old threshold for retirement and this rate is expected to continue until at least 2029.

There is also the issue of technology skills gap. The main cause of the skills shortage is the integration of advanced technology, AI and automation into the workplace. While this emerging technology definitely helps to streamline business processes and improve workplace efficiencies, it also demand new workers’ skills to programme and to operate it.

So what impact does the labour shortage have ?

It can not only hinder company growth ; it’ll also impact society as a whole. For example, supply chain disruptions have already resulted in product shortages. In some areas, the labour shortage may also have resulted in store and restaurant closures or reduced hours.

Additionally many experts are closely watching rising inflation. While there’s still some debate about whether the labor shortage contributes to inflation, many believe that today’s labour shortage will result in increased wages, higher prices and a slower post-pandemic recovery. If left unchecked, inflation could bring about a serious crisis.

So to recap, while most advanced economies are recovering from the worst effects of the pandemic, labour markets are facing a new and unexpected challenge : a shortage of workers. The complex and worrying problem may well persist for several years to come.