Bentonville-based think tank Heartland striker recently released a report showing that decades of decline in domestic manufacturing, shifting demographics and labor force participation preceded and exacerbated the “great quit” experienced throughout the COVID-19 pandemic.
The report, “The Labor Crisis and the Future of Heartland,” was co-authored by Joel Kotkin, Principal Investigator at Heartland Forward.
According to the research, the US labor force participation rate fell to 61% from 64.7% in 2010 and its peak of 67.1% in 2000. The number of workers available for each job fell to 1.4, from four in 2012. The situation is unlikely to improve anytime soon as some predict that the labor force will decline, and by 2060 the overall population will also decline.
“The workers have a leverage effect not seen since [World War II], and they choose their jobs not only for their income, but also for what their wages can actually pay in terms of housing, living expenses, good schools and ease of transportation,” Kotkin said. “In many ways, these new conditions play to core strengths, such as a tradition of skilled labor and lower costs, that make blue-collar and middle-management positions more rewarding than in places very expensive.”
The report shows how business, education and political leaders can work together to reshape the workforce. Here are some of the ways identified in the report:
- Invest in training: Workforce training programs are key to preparing communities for investments from semiconductor, automotive, and electric vehicle component makers looking to build factories.
- Create pathways for students: Mid-skill jobs, or those that require more than a high school diploma but less than a bachelor’s degree, are among the most in demand.
- Leverage immigrant labor: Immigrants, including recently arrived refugees from Afghanistan, have moved to low-cost, labor-scarce cities such as St. Louis instead of more expensive states like California.
“Unlike business services companies or white-collar technology companies, manufacturing and healthcare companies need workers with specialized skills who cannot do their jobs remotely and who also need a in-person training,” said Ross DeVol, President and CEO of Heartland Forward. “This is an area that offers great opportunities. Many central states like Nebraska, Minnesota, and Ohio are already doing a commendable job investing in job training programs and pipelines for crucial industries. This report offers reasoned analysis and practical advice for those looking to make a name for themselves in the new job market.
For a PDF of the 48-page report, Click here.