RALEIGH – Employers across North Carolina continue to scramble to fill thousands of jobs, and demand has reached the point that there’s an opening to match the number of unemployed across the state one-for-one – around 220,000. But that doesn’t mean the unemployed can find a job easily.
“Although there is a shortage of labor in some sectors, we also are seeing a reallocation of labor,” said Dr. Michael Walden, a William Neal Reynolds Distinguished Professor Emeritus at North Carolina State University in an interview with WRAL TechWire. “Those sectors experiencing large shortages are concentrated among lower-paying, high-personal contact jobs, such as those in personal services and leisure/hospitality.”
The one-to-one ratio comes is found in a new analysis from jobs research firm Career Cloud. It’s a national challenge as well as there continues to be a mismatch between employers and candidates.
The Career Cloud study analyzed data from the U.S. Department of Labor Bureau of Labor Statistics, as well as job and recruiting boards, analyzing the current state of the labor market in the United States.
In North Carolina, through Oct, 12, there are 0.97 jobs open for every unemployed person who is a resident of North Carolina, the analysis finds. Not that people aren’t finding work. The state’s unemployment rate is 4.4% which is down from an unemployment rate of 8.8% in July 2020, the study found.
In at least one area – high-tech – the situation isn’t new. But the job market has the potential to get tighter.
“In North Carolina, and the Triangle in particular, high-skilled workers continue to be in strong demand,” said Brooks Raiford, president and CEO of the North Carolina Technology Association. “This has been true for a long time, but fueled further by the many announcements of expansion by companies that wish to tap into the talent pool here.”
In its latest report, the trade group said 39,000 tech jobs are open across the state.
It’s not lack of pay leaving tech jobs unfilled, either, according to Raiford.
For technology workers, wages in North Carolina rank 5th in the nation, Raiford noted, citing the association’s recent “State of Technology Industry Report” and that the state ranks 7th in the nation for total tech industry employment growth.
But it’s not just technology workers that employers are seeking. The Career Cloud analysis found that there are 10.4 million unfilled jobs in the United States.
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“The state and national labor market really is in a state of flux due to the ongoing pandemic,” said John Quinterno, a Duke University professor and the founder and principal of South by North Strategies Ltd., a research consultancy specializing in economic and social policy.
“Over the past 18 months, the labor market has gone from being swiftly shutdown to rapidly reopening,” said Quinterno. “Employers in many industries, such as in food service and accommodation, went from laying off their entire workforces in Spring 2020 to trying to rehire entire workforces in Spring 2021.”
That’s a long period, noted Quinterno, and many people reassessed their jobs and careers, by necessity or by choice.
“There is nothing inherently wrong with that,” said Quinterno. “To the extent that some of the federal support provided earlier in the pandemic, such as the various rounds of recovery payments and the enhanced unemployment insurance benefits helped people build up some financial resources to help make new choices, that also is a positive development.”
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According to a summary of the analysis published by Career Cloud, there are multiple issues that contribute to the current workforce shortage affecting many businesses. While the pandemic is only one of them, according to Northeastern University economics professor Robert Triest, who is quoted in the Career Cloud study, it’s likely that the past year has caused a shift in how Americans view work.
“For the most part, it’s not a shortage of workers that’s the problem, per se. It’s a sign that employers just need to offer better packages of wages and working conditions to attract workers,” Triest said in the summary of the report.
“The ongoing claims of shortages calls into question the claim that enhanced unemployment benefits were making workers reluctant to return to work,” said Quinterno. “That was a problematic argument even at the time, but all of the benefits ended some six weeks ago, yet the claims of shortages exist.”
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Sectors with greatest labor shortages
There are four industries with more than one million open roles, the study found, totaling nearly 7 million positions available across the United States.
Of those four sectors, only one was found to offer a median wage that is higher than the national median of about $56,000, the study found. That sector is professional and business services, where the median wage was found to be $70,229 and there are nearly 1.79 million open jobs, according to the analysis.
In other three sectors, the median wage was found to be less than the national median wage.
Source: U.S. Bureau of Labor Statistics.
In the leisure and hospitality industry, where median wage is $25,658, the study found that there are 1.65 million job openings.
In education and health services, the study found that there are about 1.68 million job openings and the median wage in the sector is $51,533.
In the trade, transportation, and utilities industry, where there are more than 1.88 million job openings, the median wage is $47,452, the study found.
“A significant number of workers furloughed in those jobs reassessed their situation and decided they wanted work in other areas that offered better pay and working conditions,” said Walden.
Some workers were able to “upskill,” noted Walden, and the reallocation of the labor market is occurring nationally, not just in North Carolina. “For those low-paying sectors to attract workers, pay, benefits, and the working environment will need to improve.”
The Career Cloud report provides employers a framework for considering adjusting their approach to the labor market, and encourages employers to modify their approach based on the specifics of their industries and their firms, noted Quinterno. “For instance, food service businesses may need to think hard about wages and benefits, while professional service firms may need to think much more about offering hybrid schedules and flexible working arrangements.”
Employers are facing a shift in the labor market, noted Quinterno, where for the first time in about two generations, workers have some degree of power in the labor market. That’s especially true in industries and sectors that historically have relied on low-income workers, said Quinterno.
“Even if a partial shift in the balance of power is disruptive in the short term, it has many potential long-term benefits,” said Quinterno. “Better job matching between workers and firms is a positive thing, as is efforts on the part of workers to improve their skills and develop new abilities.”
In addition, lighter labor markets may also generate improvements in wages, benefits, and working conditions, said Quinterno, which can have positive multiplier effects in the economy due to workers and their households having more money and more security, yielding higher spending and more engagement in local economies and communities.
“Workers are sending a signal they want more from their jobs,” said Walden.
