90% of Surveyed Businesses Have Open Positions
It seems that good help really is hard to find — and getting even harder. As MarketWatch reports, a recent survey of American companies found that 90% were currently hiring. That figure and others point to one of the largest skilled labor shortages the country has seen in decades.
The study comes from the National Association of Business Economists (NABE), which surveyed businesses in banking, retail, utilities, and other industries. For the fifth straight quarter, the percentage of firms reporting shortages of skilled labor rose, reaching its highest level since 2008. These findings also match recent studies by Paychex that have observed a major slowing trend when it comes to hiring. Moreover, both surveys have found business owners raising wages to attract talent.
In a statement about the report, NABE Business Conditions Survey Chair Sara Rutledge said, “April survey results suggest widespread wage growth and increasing shortages of skilled labor. The first quarter of 2018 registered the highest Net Rising Index for wages and salaries since NABE began tracking the data in April 1982, and the largest share of respondents reporting shortages of skilled labor in nearly ten years.” According to the NABE report, one-third of businesses have recently upped their wages while another third say they’re training current employees for promotions in order to help fill positions. About 25% of businesses say they’ve taken to investing in automation to fill their needs and save labor instead.
Elsewhere the study also looked at recent policy changes and how they might or might not impact hiring. When it comes to the slashing of the corporate tax rate, only 11% of businesses said they planned to hire more workers because of the cut. Nearly 70% of respondents said that announced tariffs on aluminum, steel, and some imports from China would not affect their hiring plans one way or the other. Moreover they added that the tariffs would not impact their investments or even the prices they charged.
Incidentally, with tariffs aside, the NABE survey found that the biggest issue facing businesses is the rising cost of materials and supplies. In fact these costs hit a seven-year high according to the study. Because of this, profit margins slowed in the first quarter of the year while sales continued to increase.
Overall the NABE’s latest report highlights what we’ve seen to be a growing trend: shortage of skilled labor. As a result, we’re likely to see wages continue to rise as well. However, as the study shows, there’s also the chance that the current shortage could lead to more automation replacing actual workers — something that will likely have a long-term impact on the economy going forward. So while businesses of all sizes still have plenty of reasons to be optimistic, perhaps workers in some industries should be concerned about what the side effects of this shortage could be.