7 Reasons Why U.S. Businesses Are Experiencing Staff Shortages

Anna Aguilar
June 7, 2022

To this day, companies large and small across the U.S. are struggling with staffing their businesses and retaining new hires. It is no secret that in the last two years since the beginning of the pandemic in the United States, U.S. businesses have been experiencing an ongoing national staffing shortage. Of course, there are unlimited individual scenarios that are causing the mass U.S. staff shortages, but many of these reasons overlap and can be pinpointed back to the effects COVID-19 had on the country–and the world. Here are 7 reasons why your business might be having trouble attracting the right talent.

People want to be fairly compensated.

It’s as simple as that. After years of declining wages– topped off with a global pandemic that caused U.S. staff shortages left and right– employers were forced to start paying more. As the world became an “employee’s market,” companies began competing with each other to outpay the competition. Paying more meant hopefully attracting and keeping quality hires. A team of happy, well-paid workers will perform better and prove more loyal than a team who is underpaid and knows the business next door might be willing to offer higher compensation.

People want more job flexibility.

Another main reason for the U.S. staff shortages is the fact that flexibility at work is a common–and expected–benefit now. As the pandemic hit and everyone was forced to begin working virtually, employees learned first-hand the benefits of flexibility in the workplace. Work out in the middle of the day? Sure. Clock in at 9:30 and clock out at 5:30? Go for it. Take conference calls in your pajamas? Absolutely. Once the world began to open up again, the lack of flexibility for in-person jobs became unattractive, and people began to quit or not even apply to less-flexible opportunities.

Now more than ever, people care about actually liking their jobs.

For generations, enjoying your job was not something people expected or even cared about. You would go to work, get the job done, come home, and complain about your day–only to do it all over again for 50 years until society said you could retire. Ever since the pandemic hit, the younger generations in the U.S. workforce took a deep look within and decided to put their foot down. A life-changing event like a global pandemic caused workers to look within and realize that life is too short to do something they aren’t passionate about.

Workers with children require childcare.

Another huge reason for U.S. staff shortages is that once the pandemic hit, parents needed to begin working from home and taking care of their children at the same time. Childcare was not an option during the national lockdowns, so most families had to make the best of what they had. Thousands of parents had to choose to either let their work quality suffer, their children struggle due to lack of care, or quit their jobs altogether. Naturally, these circumstances led to a lot of 2-weeks notices.

Millions of Baby Boomers retired early.

People everywhere are calling this particular cause of the U.S. staff shortages “The Great Retirement.” The Baby Boomer generation had millions retire early in the midst of the pandemic. As of October 2021, an additional 3.3 million people, or roughly 7% more than predicted, had retired since right before the pandemic hit. Continuing to work from home in the mayhem of it all was stressful and seemingly pointless to a large percentage of retirees who were just a few years away from retirement anyway. Leaving the workforce early was the most logical thing to do for these workers, yet the effect it had collectively on U.S. staff shortages was massive.

The US lost lots of immigrant workers.

As you know, COVID-19 had a huge effect on traveling both intra- and inter-nationally. For a country like the United States that usually has a constant stream of people immigrating to it, restrictions like these can significantly contribute to U.S. staffing shortages. After two years of travel and immigration restrictions, the U.S. staffing world lost over two million working-age immigrants.

There’s a disconnect between available jobs and worker needs.

Today, there seems to be an available job around every corner or on every website you check. If this is the case, why is there still such a huge U.S. staffing shortage? The final reason is simple: the people looking for jobs are not interested in the ones available. This problem is widely known by economists as “mismatches.” Job expectations, pay, and location are all lacking in the eyes of applicants, and knowing how to reach the right people can be frustrating for employers.

Getting More With Less

It is clear that the pandemic caused a snowball effect that led to the staffing crisis the country is currently facing. However, we encourage you to view the U.S. staffing shortage as an opportunity to improve upon your current staffing approach. There are many ways to find the right hires for you, but automating these back-office tasks in your hiring efforts is key–as it frees up necessary time for higher level tasks and strategic functions. With Bilflo , you can automate the simpler tasks and manage hundreds of contractors and direct hires from one simple platform so you can focus on hiring and paying your talent well. Save time and labor while doing more for your business. Schedule a demo with us today.