The pandemic caused a major disruption in the US workforce. The Bureau of Labor Statistics reported August 2022 unemployment at 3.7%, roughly 6 million unemployed workers. Employers are struggling to fill 11 million open positions. At the same time, there are 2.5 million fewer people in the workforce post-pandemic.

Why? There is no simple answer, but economists and researchers point to several factors:

• Early retirements. Roughly 2.4 million workers retired during the first 18 months of the pandemic – in excess of expected retirements. Some have been lured back into the job market as compensation rises.
• Sharp drop in immigration. Issuance of visas for legal permanent residence and temporary residence between 2019 and 2020 dropped 48% and 54%, respectively. Immigrants in hospitality and food service faced high unemployment rates during the lockdowns.
• Worker burnout. Many quit jobs in business with acute labor shortages. Retail, healthcare, restaurant and education workers have become overworked as positions go unfilled. Another contributing factor is these positions often have long hours and inflexible schedules.

Employers with office workers fared better if they were willing to offer flexible work environments. Consulting firm McKinsey and Company recently published a survey titled The American Opportunity Survey based on data obtained from 25,000 Americans in the spring of 2022. Fifty-eight percent of survey respondents reported being able to work from home one day a week, while 35% reported having the option to work from home five days per week.  Eighty-seven percent of the employees took advantage of the opportunity to work remotely when offered.

We recently hosted John Norris of Oakworth Capital Bank for a webinar on the economy. To hear John’s Comments on unemployment and the lack of job candidates: Listen Now (approx. 6 minutes)

For Additional information, click here to see the report from the U.S. Chamber of Commerce.