The Washington Post published an article on declining birth rates and skill mismatch between the current workforce and labor market demand (i.e., what skills organizations are seeking). These factors are contributing to what is being described as historic labor shortages in fields like nursing and construction.
The article focuses on who isn’t entering these fields, but ignores the price signal that becomes clear when one looks at wages over time. The laws of labor economics are fairly simple. When there is a labor shortage, wages increase. When there is a labor surplus, wages decrease.
Despite these labor shortages persisting for decades, organizations and businesses have not compensated workers in these fields early enough to attract new grads or to encourage existing workers to reskill into them, and now the gap is the tell.
Framing labor shortages as a people problem instead of examining the upstream causes means we stay stuck in a cycle of perpetually underpaid high-demand labor and shortages that have serious implications for the backbone of our society.