Is there a labor shortage?

Abstract

A panel discusses ongoing and prospective developments in the US labor market. Michael Horrigan points out that job losses in the COVID recession were heavily concentrated among women, minorities, and less-educated workers. In turn, these groups have shown less progress regaining jobs, and many have left the labor force. Horrigan shows that the industry connection between vacancies and wage increases is not at all tight, suggesting that traditional explanations that labor shortages are a matter of wages not clearing the market needs to be modified. Misty Heggeness notes that much of the weakness in women's recent labor force participation has been by working mothers, but that their behavior has not been radically different than in the past. Policies that address the concerns of working mothers could lessen the possibility of swings like those recently seen. Kate Bahn expands to discuss more specific such policies, including paid leave, paid sick leave, more predictable work schedules, greater income support, as well as a revival of unions, as means to not only alleviate hardship, but also to increase labor market efficiency. Michael Strain contends that federal policy greatly enhanced consumer demand, but the income support programs, along with other problems, have restricted supply, leading to some of the distortions observed in the labor market. While he supports some of the policies proposed by other panelists, he is leery about the effects of specific government programs that have been offered.

Keywords: Female employment; Labor market; Participation; Wages.

Fig. 1

Non-farm employment index

Fig. 2

64% of job losses from Feb to April 2020 were in low wage* establishments

Fig. 3

Females with less than a BA and minority males had a disproportionate share of the employment declines early in the pandemic recession

Fig. 4

Females with less than a BA have had an especially difficult time regaining employment since April 2020

Fig. 5

Percentage of unemployed out of work 27 weeks or longer

Fig. 6

Among those with less than a BA, minorities make up a disproportionate share of long-term unemployment

Fig. 7

Persons out of the labor force who currently want a job, in thousands

Fig. 8

Females with less than a BA make up a disproportionate share of those who are out of the labor force

Fig. 9

Number of individuals who are out of the labor force who report currently wanting a job now but cite a variety of barriers to looking for work, in thousands

Fig. 10

Number of individuals who are out of the labor force and currently want a job now but cited childcare, family responsibilities or transportation issues as barriers to looking for work, in thousands

Fig. 11

August 2021 composition of Fig. 10 Group

Fig. 12

Private job openings and hires (thousands)

Fig. 13

Job openings have exceeded hires since late 2020 in professional and business services

Fig. 14

Job openings have caught up to hires recently in construction

Fig. 15

Employment status of custodial mothers

Fig. 16

What proportion of pandemic labor force exits is due to childcare?

Fig. 17

Pandemic exits due to childcare