The pandemic changed America's workforce, including the way we think about work. The labor force is no longer working just for a paycheck. Employees are demanding a work-life balance, better pay, and safety in the workplace. Given that the average worker is seriously burnt out, these requests make sense, right? Plus, many Americans have been waiting to uncover the perfect opportunity while collecting unprecedented unemployment benefits.
And now, the money tree has officially expired.
According to the Department of Labor, 11.9 million Americans are still collecting unemployment benefits. This is substantially lower than the same period last year during the height of the pandemic, where 30.4 million Americans received benefits. Pandemic Unemployment Assistance (PUA) benefits ended September 4, 2021. That week, initial unemployment claims reached an all-time low since the pandemic began in March 2020; however, 44 states reported 96,198 initial claims for PUA – a last-ditch effort at a piece of the pie.
As of the first week of September 2021, the Bureau of Labor Statistics reported the top three industries where laid-off workers are continuing to receive unemployment benefits, which included wholesale and retail trade, education and health services, and leisure and hospitality. Despite the large number job openings and millions of unemployed Americans, there is still a labor shortage, particularly in the leisure and hospitality industry.
As the economy began recovering in 2021, there was an expectation that workers would return to their old jobs; thus, restoring the pre-pandemic equilibrium of employment and wages. However, more than 3 million Americans left the labor force entirely during the pandemic, including prime-age workers (25-54), women, and baby boomers nearing retirement. Among prime-age workers, the labor force declined from 82.9% in February 2020 to 81.7% in June 2021. Female labor force participation dropped more than 60%, and baby boomers retired at a faster rate than pre-pandemic levels.
Employers may need to offer higher wages to nab returning employees.
One of the contributing factors to the labor shortage was the $300 in weekly supplemental unemployment benefits. According to research, the average employee in the Leisure and Hospitality industry received 17% more in unemployment benefits than their regular weekly salary. A Bank of America Global Research report showed that employees who earned less than $32,000 annually made more on unemployment. In California, the lowest wage earners potentially made $750 a week on unemployment. This discrepancy was not the case for higher-wage earners.
In an economy with a quick demand for workers, companies that are willing to pay more will fill positions faster. And for some of the lowest-paying job sectors, companies will need to offer sign-on bonuses and increased wages. Workers are being more selective about where they work. They want better pay, flexible working arrangements, and more fulfilling work.
Laid off employees upskilled and reskilled during the pandemic.
Post-pandemic employees are searching for something better than their last job— it’s human nature to do so, isn’t it? Retraining was highest among people who lost the most income while laid off during the pandemic. The same report showed that 7 in 10 people were open to completely different roles than they previously held, and that employees were more apt to upskill over reskill to advance their careers. A survey of over 2,000 adults in the UK showed that 24 percent learned a new skill to boost their value and employability post-pandemic.
I predict that employees will use their new skills to start higher up the ladder than where they left off during the pandemic.
Safety concerns still loom for many who are returning to work.
Many workers have lingering concerns about contracting COVID. While employers can legally ask to see proof of vaccination or require employees to self-attest, vaccinations are currently not a legal requirement to return to work, with few exceptions. If you have any legal questions or concerns about your rights regarding COVID and work, consider consulting a personal injury lawyer for advice.
States may mandate vaccination requirements for school-age children and proper immunization of healthcare workers and residents of healthcare facilities. Employers can also legally require vaccines to re-enter the physical workplace, but they must find alternative arrangements for employees unable to get vaccinated for medical and/or religious reasons. Even with the release of the Equal Opportunity Employment Commission's applicable vaccination laws, legalities of COVID vaccination requirements will ultimately be settled in court.
The pandemic acted as a big reset button in terms of values and what really matters to employees. And with more leverage than ever before, they are putting health and safety first and demanding more for their time. The workforce has changed, and employers will need to catch up to be successful moving forward.
