Amplified by the pandemic, the future of work is unfolding before our eyes. What once was a trendy topic and mode of survival–to now table stakes and a long-term strategy–the gig economy has rapidly evolved in just a few short years.
Looking back, retailers will remember 2020 as the year they went into lockdown and learned how to quickly manage the risk of working alongside the coronavirus. 2021 ushered in the Great Resignation–where 4.5 million people voluntarily left their jobs and sent the labor market screaming for talent. As worker priorities continued to shift, 2022 was a game of tug of war between employers and workers–with flexibility up for grabs and gig work at the forefront. Rounding out 2023, we saw a mixed bag of labor reports and headlines that will continue to test the fortitude of retailers and workers alike again in 2024.
As we turn the page and step into a new year, labor challenges remain. A recent survey by MHI showed that recruiting and keeping qualified workers was cited as the leading challenge for the 2,000 supply chain executives who responded. A majority, 57%, state that hiring and retaining qualified workers is their greatest challenge, along with 56% struggling with ongoing specific talent shortages.
The Current Landscape: Labor Challenges Persist
According to the latest U.S. Chamber of Commerce labor analysis, a range of industries sensitive to supply-chain vulnerabilities face labor shortages, led by durable goods manufacturing, wholesale and retail trade. “Even if every unemployed person with experience in the durable goods manufacturing industry were employed, the industry would fill only around 75% of the vacant jobs,” the report states.
The most recent jobs report from the Bureau of Labor Statistics indicates that thousands of individuals are joining the workforce, which is good. However, labor force participation still does not match what it was before the pandemic for a variety of reasons.
In the latest State of the U.S. Workforce Report, data shows that if the labor force participation rate were at the February 2020 level, we would have an additional 2.2 million people in the workforce. This shortage is impacting all industries in nearly every state. Even if every unemployed worker were to fill an open job within their respective industry, there would still be millions of unfilled job positions. And then the reality is that the labor force participation rates are unlikely to recover fully. In fact, experts estimate that the overall labor force participation rate will drop to 60.4% in 2030. Nearly three full percentage points less than the February 2020 rate. Something worth pondering.
In just a few short years, flexibility has taken a front-row seat in today’s workforce with no signs of slowing down. Gartner’s 2024 Workforce Trends highlighted the importance of collapsing career stereotypes in the face of these workforce changes. The report noted, “Atypical career paths are going mainstream with rising retirement ages, midcareer breaks, shifts across industries, and embracing contingent work and other nontraditional employment models such as gig. In light of this, the old assumptions that underpin many organizations’ talent management strategies will prove a growing barrier to acquisition and retention.”
Looking Ahead: Embracing Flexibility in the Evolving Workforce
So, what can organizations do to get ahead of what’s to come? Gartner’s Emily Rae Rose underscored the importance of leveraging diverse talent pools. “With ongoing talent shortages and the need to control costs and measure technology's productivity returns, organizations must successfully tap into evolving labor pools in order to achieve strategic workforce and technology goals,” she said.
Looking ahead, two things are certain. One: The future of the U.S. workforce will continue to change at a fast pace. Two: It is impossible to predict what’s around every corner. Eric Termuende, leading speaker, and author of The Future of Work may have said it best. “Instead of asking ‘what does the future of work look like?’– organizations should be asking ‘how can we build a better team now that will help us get to what the future of work looks like.” No doubt, some food for thought.
Hyer, a member of the RIC Startup Network and the RILA led Coalition for Workforce Innovation, is our guest blog for the month.
Hyer is an easy-to-use app that connects retailers and brands to on-demand labor in the tap of an app. Similar to Uber, but for labor, Hyer connects you to 400,000 background-checked, insured gig workers (Hyer Taskers) in real-time, with no commitment or advanced scheduling needed.
Join Hyer at RILA's LINK 2024: The Retail Supply Chain Conference
TUESDAY, February 27th - 11:00 AM - 11:45 AM
Meijer + Hyer ｜The Power of Flexibility: Building an On-Demand Workforce of the Future
TUESDAY, February 27th - 12:30 PM - 12:40 PM
Startup Pitch & Interview with Dave Dempsey | CEO | Hyer