Labor Outlook: 2025
January 6, 2025
While we currently have a strong U.S. jobs market, we don’t have enough people to fill those jobs, and 2025 will see ongoing labor challenges.
The labor shortage varies by region, with greater shortages of skilled workers in:
- New England (i.e., Maine, Vermont, New Hampshire, and Massachusetts);
- The northern Rocky Mountain and Great Plains states (i.e., Utah, Wyoming, Montana, North and South Dakota, and Nebraska); and
- Parts of the South (i.e., Arkansas, Mississippi, Alabama, and South Carolina, up to Virginia, Maryland, and D.C.).
Much of the labor problem that we currently face started with the COVID-19 pandemic and what’s known as the Great Resignation, when millions of American workers at least temporarily quit their jobs, subsequently taking early retirement, aging out, or seeking more rewarding work (on many levels) then they had had before. Many employees got a taste of the benefits of remote working during the pandemic and became unwilling to take employment that required them to commute again. Many transitioned to part-time work and are sticking with it. And a great many former employees have started their own businesses. Millions of people now support themselves through digital commerce and social media.
Also, with the pandemic came stimulus checks, and much better unemployment benefits for a time that, for some, provided more money than they had been taking home from their jobs. This led to increases in personal savings and thus the ability to be pickier about employment.
The more recent rise in inflation has now necessitated the return to work for many. So, in this climate of greater employee expectations, what can we do to attract the best people to our organizations? What are today’s job seekers looking for? Some of the things that job seekers now often see as basic requirements are:
- Adequate compensation (i.e., competitive wages and benefits)
- Flexibility (i.e., remote or hybrid working options, hours flexibility, a shorter work week)
- A reasonable work/life balance and a concern with personal well-being (i.e., adequate vacation time)
- Career development opportunities
- A respectful, friendly, and inclusive workplace culture
In today’s environment, building a happy, skilled, loyal workforce takes a thoughtful, deliberate approach, and an awareness of changing ideas of what it means to live a good life, one that includes meaningful occupation, healthy relationships, and balance.