I can’t be the only person wondering where all the workers went.
Immediately following the pandemic, it made sense that the economy would take time to stabilize and settle again. But it’s almost 2024, and everywhere I look there are shortages in virtually every industry.
Here are just a few:
Indiana has a lawyer shortage that is hurting some Hoosiers.
Parents can attest to a shortage of bus drivers, with routes combined and often canceled.
And Indiana’s teacher shortage continues.
Nurses, doctors and virtually all other medical professionals are at a premium.
School counselors are sorely in need.
Child care is virtually impossible to find, especially in rural areas. And it is set to worsen.
There is an overall labor shortage in Indiana and the United States.
So, how is it possible to have so many shortages with an ever-growing population?
I am not an economist, so I reached out to the experts to try to break it down. Both Matt Will at the University of Indianapolis and Michael Hicks at Ball State University cautioned, though, that there isn’t one answer.
Partisans want to latch onto one reason that fits their narrative. But it’s a more complicated picture than that.
Will said the direct answer is a smaller share of people are participating in the workforce. Before the pandemic, 63.4% of people in the U.S. were participating. That is now down to 62.7%, which equates to about 2.4 million people who are no longer working.
So why aren’t they working? Will said one factor is child care. A lack of access, whether that’s not finding any open seats or not being able to afford them, has kept some parents at home — preventing them from working.
Another issue is that many people have simply decided to accept a lower standard of living. Perhaps during COVID-19, they lost their job and spent more time at home with their children and families. They realized they could live on less, and are now choosing a lower standard of living with a higher quality of life, Will said.
Hicks focused more on wages driving workforce availability and said Indiana’s average weekly wages for all employees is substantially lower than the national average by about a quarter. And that isn’t made up in the cost-of-living differential.
He said in the private sector businesses have had to increase wages to meet or exceed inflation. This is causing a recent national rebound, as evidenced by a decline in help wanted ads.
But Indiana’s wages have remained low: “Most businesses are not psychologically prepared for the wages they need to pay,” Hicks said.
Similarly, in the public sector, wages are the primary reason for a shortage. He said teachers are making less than they were in 2000 in inflation-adjusted terms. This is despite lawmakers putting more and more money into the system.
“Plenty of people want to teach but it pays so poorly it’s one of the least viable occupations today,” Hicks said.
So, with the 2024 legislature coming in January, is there anything that state officials can do?
Hicks said they could reduce some impediments in the area of child care by subsidizing it but that’s not a long-term solution.
Will argues that anything they would do would make it worse.
“Government spending doesn’t help. I think they should be hands off. That is my philosophic belief,” he said.
Honestly, after doing research and interviews I feel like I understand more what is happening and why. But it doesn’t make it any easier for Hoosiers who are waiting three months for doctor appointments, who are unable to afford day care or who consistently experience poor retail service.
And it doesn’t help the workers who are showing up in dealing with the immense pressure and long hours.
Maybe one day we will see this as a growing pain, but right now it’s just painful.
Niki Kelly has covered the Indiana Statehouse since 1999 – including five governors. She has been honored by the Society of Professional Journalists and Hoosier State Press Association for stories on the Religious Freedom Restoration Act, criminal justice issues and more. She also is a regular on Indiana Week in Review, a weekly public television rundown of news. She shifts her career to helm a staff of three and ensure Hoosiers know what’s really happening on the state level.
