Q1: How is the labor situation looking since last June?

A: The jobs recovery has been robust though it has slowed down in pace compared to where we were six months ago. Taking a step back and looking at the whole picture of all the reduction in economic activity and as measured by the total number of payroll jobs nationally about 18.5 million net jobs lost have been regained. About 83% of the net jobs that were lost early on when the pandemic first hit the US have been recovered. From May of 2020 data to November 2021, an additional 3.7 million jobs have been gained but there remains a substantial employment gap of about 4 million fewer jobs today compared to where we were just before the pandemic. Unemployment has come down from almost 15% at the peak in April 2020 to 4.2%.

Q2: LeadingAge members have the same positions as they did before the pandemic, where did all the workers go?

A: Job recovery is being held back because labor force participation remains low. There are two sides of the labor market. Labor demand (employers who have jobs that they’re hoping to fill) and labor supply (people who are in the workforce who are connected to a job or might be looking for a job opportunity). The pandemic has had a dramatic effect on both demand and supply. Early in the pandemic a range of different challenges (i.e., the fear of personal safety, school closures and reduction in the availability of childcare) led to a shortage of labor supply.

Vaccines became widely available in the US in the spring of 2021 and people started to return to different types of economic activities. Employers sought to quickly increase their staffing levels in response to meet this anticipated demand of people returning to the different types of economic activities, but the labor supply did not rebound at the same rate.

Q3: How can employers’ stand out in the current workforce market?

A: Employers can compete on different dimensions and pay is certainly one of them. An important skill is being responsive to the needs of job seekers in the labor market. It helps you stand out in the crowd. A suggestion for employers is to re-evaluate job postings and try to consider job postings from the perspective of a job seeker who has many options in the prevailing labor market.

Q4: Is the enhanced unemployment benefit a reason for low labor supply?

A: That is not the primary factor holding back further labor market recovery. Several studies that looked at the effect of the enhanced unemployment concluded that it had a relatively small effect in recovery of the labor market.

Demographic shift is an important element of understanding what’s happening in the labor market. A recent analysis from the Federal Reserve estimated that over half of the decrease in labor force participation was due to retirement. Labor force participation among age 55 or older is down 5% compared to just before the pandemic. We have a large baby boomer cohort that’s either reached retirement or nearing retirement age in the near future relative to the smaller number of younger folks aging into the workforce to replace them.

Q5: What’s the effect of the pandemic on younger women working in aging services?

A: The pandemic is still affecting our education and childcare system, which is leading to an increased care burden for many working aged parents. Labor force participation is down the most among women between the ages of 35 to 44 and 25 to 34. For working women between the ages of 35 to 44 labor force participation remains lower by 2.25% compared to just before the pandemic.

Q6: How has COVID changed the way we work in this country?

A: The pandemic has caused us to re-examine the assumptions we had about getting work done, one example that we’re continuing to see is the prevalence of remote work. Many employers didn’t offer or may be didn’t even consider that before the pandemic and now have reconsidered. Employers are more responsive to the needs of their workforce as a result.

The pandemic has helped us realize the importance and the dependence of our economy on the strong foundations of education and childcare. The pandemic disrupted the school system and led to changes in the provision of childcare that created a challenging environment for working aged parents, that put a strain on the workforce. Employers are being mindful of the demands faced by their workers and offering a bit more flexibility to try get the job done.