Help wanted: Workers finally benefit as labor shortage expands
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Increasingly, the United States is running short of workers. The shortages are most visible in pockets of the country and in certain industries. But those pockets keep getting bigger. The robust US economy created 235,000 new jobs last month, the US Labor Department announced Friday, above what many economists had expected.
All this is great news for workers, because the shortage is forcing increasingly desperate employers to boost pay and benefits to attract and hold onto recruits in several fast-growing industries. Average wages are starting to grow at rates not seen since 2000, the last time the US confronted a severe worker shortage. The challenge is economic growth: Not having enough workers is already curtailing production in some areas. And if wages and salaries go up faster than corporate profits, companies will see their bottom lines suffer and, potentially, their stock prices fall.
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The shortages are worse in some professions and geographies than others. For example, the nation confronts a nursing and primary care physician shortage everywhere, but in rural areas it is more acute. In Yakima, Wash., a doctor will see between 1,500 and 2,500 patients, many of whom are low-income. The loss of physicians there has reportedly left patients with up to three- and four-month waits to see a doctor.
Low-paid workers are being lured to higher-paying industries, such as manufacturing, which added 28,000 workers last month after a slowdown. Workers who moved from professional services to factory work saw wages jump 6.9 percent, while those moving from trade into manufacturing saw a 6.2 percent jump, according to ADP’s Workforce Vitality Report.
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By contrast, workers already in the US would more likely benefit from a decrease in immigrants because companies would have to bid up wages and salaries to retain the workers they have. Already, over the past three years, average wages have grown of 4.2 percent even after adjusting for inflation. That may not sound like much, but that means the average American worker is making gains not seen since the late 1990s, when the labor market was even tighter. In 1999, for example, real average wages climbed 7 percent over three years – the strongest three-year spurt in nearly four decades.
Expect the wage growth to continue to accelerate, says Mr. Levanon, especially if the economy again starts creating 200,000 or more jobs every month. Recessions will come and go, which may halt the trend temporarily, he adds. But “in the next 15 years, there will be almost no growth in the labor market” as baby boomers retire, which means workers will be even scarcer.
http://www.csmonitor.com/Business/2017/0310/Help-wanted-Workers-finally-benefit-as-labor-shortage-expands
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