Pandemic didn’t help, but Wisconsin’s worker shortage has been building for years.
The heated political argument centers on whether to blame enhanced unemployment benefits for Wisconsin’s worker shortage (the conservative view) or if it’s instead social and health barriers keeping potential employees home (the liberal position).
Both are far too simplistic, though not entirely wrong.
When enhanced benefits paid as well or better than many jobs it clearly amounted to a disincentive to work. Note, however, the enhanced payments ended in early September. Yet the help wanted signs have not been coming down because a wave of new job applicants never appeared.
Likewise, the pandemic made it more difficult for some, including parents with small children -- or even school-age children when classes were canceled -- to make proper arrangements that allowed them to work. Also, the cost of childcare easily can exceed the earnings from some jobs. Still, nearly all schools are now open but the marketplace is not swarming with job-seekers.
Why is that?
For a quarter century or more the people who study such things have been sounding an alarm in Wisconsin. The state has not been producing enough new workers to meet growing demands. Meanwhile, the baby boom generation has been retiring in massive numbers, a trend which accelerated during the pandemic. Birth rates have fallen. And, as former Gov. Tommy Thompson used to say, Wisconsin’s leading export is its talented young people, who leave the state in large numbers, usually headed for the nation’s hippest major urban centers or warmer places to live.
The impact on the economy is obvious. Businesses struggle to find enough workers and some are forced to reduce service hours. Some labor intensive businesses may find it’s impossible to operate. When top young talent leaves the state it becomes more difficult to find qualified applicants for higher-skill jobs. Supply chain disruptions are not solely due to ships anchored offshore. Production is limited, and so is shipping. It’s tough to fuel a robust economy without the people to make it happen.
Here’s a number to remember, from a Pew Research Center study reported by the Appleton Post Crescent. Between 1946 and 1964 there were 76 million baby-boomer births. Between 1981 and 1996, the prime millennials’ period to replace boomers, 62 million births were recorded.
Wisconsin has been impacted more than many other states. None of this is a surprise or a mystery. Head counters have known it was coming for decades.
For workers, anyway, there’s good news. The law of supply and demand applies to labor, same as any other market. Not much is heard these days about the political argument for and against resetting the minimum wage at $15 an hour. Why? Because desperate employers have been increasing starting wages in an attempt to get stronger responses for help wanted.
The shortage also is reviving unions, which are pressing harder -- such as 10,000 workers striking John Deere -- and feeling empowered with a seller’s market for labor.
Wisconsin -- or any other state -- can’t wave a magic wand and suddenly create a larger labor pool when well-known demographic trends finally have reached a critical point. And few things are as counter-productive as partisan politicians trying to point fingers and score points when they are all fully aware the problem is systemic and long-standing.
Instead, what’s needed is consensus, strategy and willingness to take action. Here are some possibilities:
Institutions of higher education should partner closely with the private sector in an effort to steer the best and brightest toward Wisconsin jobs.
State policy-makers could help finance college or forgive student loans for talented young people who agree to stay and make a career in Wisconsin.
Employers will have to offer not just competitive, but exceptional, compensation and benefit opportunities.
Employers also would be wise to strive harder to keep both older workers and parents on the job by increasing flexibility and conditions, including working from home with convenient hours.
The state could help by looking at tax breaks for employers building systems to keep workers they might otherwise lose.
Policy-makers could consider programs to entice immigrants to Wisconsin, particularly skilled immigrants, rather than joining a national chorus to demonize them.
This one may seem far out, and it is, but the real solution is turning around demographic trends to increase Wisconsin worker numbers in the future. Yes, we mean couples having more babies. Policy-makers can design tax incentives for parents with kids, and they can help meet needs by incentivizing childcare opportunities to promote work.
Look, this is not the short-term partisan talking points nonsense the political set wants everyone to think it is. Wisconsin’s worker shortage was expected, and it will be a continuing problem. The public and private sectors both have a stake in arguing less and doing more to forge lasting solutions.