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The Seasonal Labor Shortage is a Harbinger of an Evolving Hourly Jobs Market

Nearly 60% of the American workforce is paid hourly and have been on the front lines of the pandemic. Now they are using their collective power to disrupt the way businesses think about staffing.

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U.S. seasonal job postings reached a record of almost one million as major retailers scramble to stock shelves and brace for the demands of an American public that is increasingly willing to conduct their holiday shopping in-store. Some of our nation’s largest retailers are looking for short term fixes by offering bonuses and increased hourly rates. While these measures may work for the holidays, come 2022, if retailers (and all industries that rely on hourly staff) do not reevaluate their approach to hiring and retaining these workers, then the job shortage will continue. 

82.3 million Americans, or 58% of the entire country’s wage and salary workforce are paid at hourly rates. They serve as mall Santas or delivery drivers during Christmas, and beyond that they serve us food, clean our airports, wash our dishes, and pack and ship our e-commerce purchases. They have kept us safe and supplied during the pandemic, and now they are using their collective power to disrupt the way businesses think about staffing.

Related: Quality Leadership in the 'Great Resignation' Era

Challenges for businesses that rely on skilled hourly workers 

The hourly work sector has undoubtedly seen an increase in both job growth and opportunities as the U.S. comes out of the pandemic. Higher vaccination rates, increase in hourly pay and a reduction in COVID-level unemployment benefits are just a few of the common reasons cited for this growth. Yet, despite the opportunities and seemingly available labor force, many of these jobs go unfilled. The Bureau of Labor recently found that there are 3.5 million fewer people in the workforce today than there were in February 2020. 

The hospitality industry, for example, was ravaged by COVID-19. Events were canceled, travel curtailed and restaurants were shuttered. This put 2.7 million Americans out of work as of August 2020. And yet, with the unemployment rate in this industry dropping from 21% to 9.1% in just 12 months, there remains a massive shortage of people filling these jobs, while another 6% of hospitality staff voluntarily leave the industry every month.

Related: 3 Ways to Flip the 'Great Resignation' Into the 'Great Retention'

On the other end of the spectrum, light industrial jobs, such as warehousing and meal delivery services have grown exponentially during the pandemic. Jobs in warehousing and transportation grew 229% from 278,000 to 639,000 in 2020. And yet, the industry is still forecasting a labor shortfall of more than 2 million jobs by 2030.

The future of skilled hourly work 

The fluid nature of today’s workforce requires training as many shift from one job sector to another. According to the National Skills Coalition, 52% of jobs in the U.S. require skills training beyond high school (but less than a four-year degree.) However, only 43% of American workers have access to the adequate training necessary to fill these in-demand positions.

If we are to continue with a swift and strong economic recovery, employers, labor organizations, the government and staffing firms will all need to step in to fill this skills gap with effective and accessible training programs.

Flexibility is paramount

The pandemic has proven that not all work needs to be done on-premise. Hourly workers have witnessed their counterparts in traditional office jobs succeed in remote and hybrid environments and are looking to achieve the same levels of flexibility. 

Historically, these options have not been possible for hourly professionals, since the majority of their work doesn’t occur behind a computer screen and requires them to be on-site. But today’s hourly workforce is clear and vocal about their needs, and flexibility is at the top of their list. They see the ability to work from home as akin to having the option to schedule work around the rest of their lives. A “traditional” work week is no longer suitable for all employees, and that’s a significant change in mindset that employers must accommodate to successfully staff their workforce in a post-COVID-19 environment.

Fortunately, nearly nine out of 10 employers agree that hourly workers deserve flexibility in their work schedules. More importantly, they also agree that it is possible to achieve flexibility and remain productive and successful when workers need to be physically present to perform their job. Moving forward, it’s paramount for employers to provide flexible work solutions that appeal to their workforce, enabling them to attract and maintain good people. 

Technology-based staffing platforms and digital job marketplaces can help to facilitate unmatched levels of flexibility and work-life balance for the hourly workforce, empowering workers to build schedules that fit their lifestyle, while connecting businesses with experienced and reliable staff. Flexible staffing solutions make it possible for hourly workers to fill roles best suited to their skill set, during the shifts that work best for them.

Related: The Importance of Having a Remote Work Option

The challenges faced by employers across industries––from hospitality, food and beverage, and retail––don’t end by offering their workforce more flexible schedules. To ensure “the future of work” in the U.S. remains bright, employers and lawmakers need to recognize that skilled hourly workers represent the majority of the workforce and are the backbone of our economic recovery. Accommodating the "forgotten 58%" with a flexible schedule and proper training is key to post-pandemic prosperity for our workers, employers, and the economic security of our nation.

Sumir Meghani

Written By

Entrepreneur Leadership Network Contributor

Sumir Meghani is the CEO and co-founder of Instawork. His expertise on the evolving labor market has been leveraged by leading publications including the Wall Street Journal, CNBC, Fortune, Washington Post and more.