Job vacancies have stayed high or have been rising in various parts of the world, despite slower global growth and tighter credit markets. Countries around the world have taken measures to address these unusual worker shortages–but piecemeal solutions overlook the transformation of the global labor market, the fundamental ways it has changed since the pandemic, and the consequences of the demographic transition worldwide.
Global growth has slowed since 2022, as various shocks and conflicts have damaged and continue to threaten the global economy. With tighter credit conditions everywhere and businesses still reeling from inflation, unemployment is projected to rise steadily in the coming years.
Yet the number of job vacancies–unoccupied roles businesses are eager to fill–remains surprisingly high or even close to record highs in various parts of the world. Even in the markets where job vacancies have been trending down in recent months–such as in Australia, Canada, Denmark, Singapore, the U.K., and the U.S.–they remain unusually high and above their pre-pandemic average. Elsewhere, for example in Belgium, Cyprus, Germany, Greece, Latvia, Lithuania, and Spain, they have stayed high or have been rising.
The real number of vacancies could be even higher if we consider that firms may be discouraged from posting new vacancies, having previously failed to find qualified workers. In Germany, although the number of registered vacancies is about 700,000, the government estimates that the real number is closer to 2 million.
The mismatch between the skills that workers have and what employers need presents a significant barrier to filling job vacancies. The reality is stark: While the job market burgeons with opportunities, a mismatch in skills leaves many positions unfilled, even in the face of high or rising unemployment.
A skills shortage
In Ontario, Canada, the manufacturing sector is struggling to fill the roles, with over 18,900 vacant positions and an impending influx of more than 7,000 jobs in the electric vehicle sector looming over the next two years. At the end of 2022, Australia encountered a similar scenario, with job vacancies surpassing the count of unemployed individuals. In Singapore, the post-pandemic labor market is characterized by a mismatch between the jobs available and the skills of the workforce, resulting in 1.6 job vacancies for every unemployed individual. Across Europe, the longstanding struggle to find enough skilled workers in the construction sector has been exacerbated by a surge in demand following the pandemic, signaling a broader, global challenge.
The acute shortage of skilled labor is now seen as a barrier to economic growth. In Germany, economic growth prospects are now at 0.7%–far below its long-term average of 2%–partly due to a worker shortage. Businesses eager to grow and capitalize on new market opportunities find themselves hamstrung by the difficulty of sourcing workers with the right skills. This gap between available jobs and the skills of job seekers not only underscores the inefficiencies in current workforce development strategies but also highlights an urgent need for educational and vocational training programs to pivot. Industry representatives across countries have argued such programs must now evolve swiftly to match the demands of a rapidly changing marketplace, one where the push for low-carbon technologies and the pace of digitalization is accelerating the demand for new, specialized skills.
The scramble for solutions
The rise in job vacancies and worker shortages reflects several underlying trends. After a downturn in 2020, the global economy saw a robust rebound, surging by 6.3% in 2021 and 3.4% in 2022, which, in turn, spurred an uptick in job postings. The second piece of the puzzle could be related to reduced immigration flows due to COVID-19. The pandemic prompted many workers to leave their host countries, while immigration systems grappled with delays in visa processing, creating worker gaps as a result. Third, wage stagnation has been a persistent issue. For instance, in Australia, even as wages have seen some increase, they have failed to match the rising cost of living. Finally, specific national circumstances also play a role, such as the U.K.’s labor market challenges post-Brexit.
In response, governments have started taking steps to recruit more immigrant workers or formalize their status. At the end of last year, Greece approved new legislation granting thousands of undocumented migrants residence rights, provided they secure employment. Top officials in Germany have gone so far as to admit that the country could not close its widening workforce gap without migrant labor. Berlin has implemented several legislative changes aimed at making Germany more appealing to migrant workers, including simplifying the path to citizenship, accelerating visa processing, and recognizing foreign qualifications in the job market. More countries may follow suit.
New work arrangements, such as a four-day workweek, are also being explored. In Germany, since February, dozens of companies have been piloting a four-day workweek. The idea is that a shorter workweek could ultimately make workers more motivated and productive, helping ease labor shortages in the process. Other European countries are running similar trials. Meanwhile, in at least one German city, public companies are hiring students to help alleviate the shortage of workers. Remarkably, some U.S. states have been considering easing child labor laws and allowing more teenagers to be hired by establishments because migration policy is thought to be more controversial.
A global demographic transition
In the meantime, an economic slowdown could temporarily conceal the underlying trend of increasing job vacancies. Take the U.K., where the ongoing economic contraction is simultaneously driving up unemployment rates and diminishing the number of available positions. Similarly, in Denmark, the recession towards the end of 2023 appears to have contributed to a decrease in job openings. As these economies eventually rebound, we are likely to see a resurgence of labor shortages and vacancies.
However, piecemeal measures alone will not solve the issue, as a longer-term demographic transition is unfolding worldwide. Across advanced economies, unfilled vacancies are set to rise due to aging populations. Official estimates suggest Germany’s aging society will be short seven million skilled workers by 2035. Japan’s working-age population peaked in 1998, and the numbers have been on a steady decline ever since. The U.S. stands on the precipice of a job surge, with forecasts promising 11.9 million new roles by 2030, yet the domestic labor force is on track to fall short by 3 million, even as the economy clamors for workers.
Populations worldwide are aging quickly, a trend not spared even among traditional labor-sending and lower-income countries, with Africa being the lone exception. This reality indicates that more open migration policies aimed at these traditional sending countries–a significant policy shift virtually unattainable in the current political landscape–would not suffice. Countries in Central America now have fertility rates below replacement, echoing the concern that many migrant countries of origin and lower-income countries will be “old before they get rich.” While facilitating access for African migrant workers to high-income labor markets will be important, equally vital is the investment in their education and training, ensuring that African workers make full use of opportunities overseas.
A workforce in crisis
In addition to an aging world, the Great Resignation was real, with many workers having left the workforce since the pandemic. In the U.S., an unprecedented 50 million workers stepped down in 2021 and 2022, reflecting a growing dissatisfaction with work following the COVID-19 pandemic. Although initially perceived as predominantly an American trend, the data suggest that this general dissatisfaction has spread to other parts of the world. France witnessed a record 2.7 million voluntary resignations in 2022, with similar trends observed across Europe, though Asia saw a decline in resignations. In Australia, there are growing signs of similar worker discontent. And even in the U.S. where quit rates have recently fallen, certain industries like personal care services continue to report higher-than-average resignation rates.
The labor shortages we observe can partly be traced back to the devastating impact of COVID-19, including the lingering effects of long COVID. In the U.S., the workforce has not only mourned the loss of over a quarter-million working-age individuals to the virus but has also seen a lasting reduction, with a figure more than twice as large across various age groups withdrawing from employment. Particularly affected were migrant communities, which suffered higher COVID-19 mortality rates, further exacerbating the decrease in available migrant labor.
Following the pandemic, a pronounced shift in work preferences has emerged, with a growing demand for reduced hours, enhanced flexibility, and better work-life balance. In the U.S., a substantial number of employees, for whom resignation isn’t a viable choice, have voiced a clear preference for more flexible working conditions, remote opportunities, and improved work-life balance–an enduring legacy of the pandemic’s impact on workplace norms. In Singapore, workers are willing to trade off pay for flexibility. As a result, this trend, particularly among younger workers, higher earners, and women, has led to a reduction in working hours in the U.S., further exacerbating labor shortages.
The surge in vacancies isn’t just an anomaly–it signals a profound transformation sweeping across global labor markets. This shift encompasses not only the demographic transition but also the changes in work preferences post-pandemic.
Existing solutions may offer brief relief, and economic downturns could hide these challenges temporarily, but ultimately, the resolution will require global coordination unlike we have seen before. It’s time for daring, creative approaches to mobilize diverse labor pools: harnessing Africa’s rapidly growing working-age population, tapping into the underutilized potential of older but still productive workers from lower-income countries, and re-engaging the retirees and dissatisfied younger workers of wealthier countries.
Recognizing the interconnectedness of the challenges before us is crucial. We are part of a singular, global labor market. The problems we face are shared, and so must be the solutions we will figure out, together.
Most Americans think they pay too much in federal income taxes, and about 6 in 10 mistakenly believe middle-income households shoulder the highest tax burden.
In fact, only about 18% of adults correctly identified the group facing the highest federal tax burden, which is high-income Americans, according to a January poll from AP-NORC.
With less than one week left to file tax returns for 2023, taxes are on the mind of millions of Americans, with many expecting refunds, and others owing money. Only about 27% of taxpayers believe their federal income taxes are fair, with 60% believing their burden is too high, AP-NORC found.
In fact, the U.S. tax system is designed to be progressive, meaning that lower-income Americans pay a smaller share of their income in federal taxes than high-income workers, noted Alex Muresianu, senior policy analyst at the Tax Foundation, a think tank focused on tax issues.
"Raising another dollar from someone who is higher income is not going to be as much of a burden to them as raising another dollar from someone who is lower income," he said.
At the same time, there's a push from some lawmakers and policy experts to boost tax rates for the rich, with President Joe Biden proposing to reverse a rate cut on the nation's top earners that was part of the 2017 Tax Cuts & Jobs Act. Under Biden's proposal, the top marginal rate would return to 39.6% from its current level of 37%.
In 2021 (the most recent data available), the typical earner paid $14,279 in federal income taxes, with an average tax rate of 14.9%, according to a recent Tax Foundation analysis of IRS data. Federal taxes don't include the payroll tax that covers Social Security and Medicare.
But it's the top 50% of earners who contribute almost all of the nation's federal taxes — nearly 98%. The bottom 50%, who individually make below $46,637 annually, account for about 2.3% of the country's tax receipts.
The top 10%, with incomes of at least $169,800, pay about three-quarters of the nation's tax bill, the analysis found.
Although most Americans believe the middle class bears the heaviest tax burden, it's actually the top 1% who pay the highest federal tax rate, at 25.9%, the Tax Foundation analysis found.
Even so, about 6 in 10 Americans said they were bothered by the feeling that corporations and the rich aren't paying their fair share in taxes, Pew Research found last year. That may explain why about two-thirds of those polled said they support higher taxes on the rich.
Generation Z, or those born between 1997 and 2012, are shaking up workplace norms, including how critical feedback is delivered. Cultures clash when older generations, who may have gone without much explanation or care in their early careers, critique younger workers in ways that unintentionally alienate or discourage them, experts who study the multigenerational workforce say.
Gen Z is only going to become a larger part of the workforce — they’re expected to comprise more than 32 percent by 2032, according to the U.S. Bureau of Labor Statistics. And they’re asking employers to listen.
Gen Z employees reported the greatest decline in feeling cared about at work, having the chance to learn and grow, having progress discussions with their supervisors, and feeling that their opinions matter, according to a recent Gallup survey. And less engaged workers often leave.
“Rather than just saying, ‘Hey, you did this wrong,’ say, ‘I’d like to have a conversation on where your thought process was and where you went wrong,’” said Yatri Patel, 24-year-old software engineer at the Tennessee Valley Authority, the energy agency where she’s working her first full-time job. “Help me understand.”
As the first generation to have grown up with the internet at their fingertips as toddlers, Gen Z is used to having instant access to information, experts said. So when they don’t know how to do or understand something, they go online for more information. They bring those expectations to work, where information about the workplace can be harder to access, said Megan Gerhardt, professor at Miami University and author of “Gentelligence: A Revolutionary Approach to Leading an Intergenerational Workforce.”
“Through Google, Siri, and Alexa, they got answers to anything they wanted to ask,” she said. “In the workplace, they’re moving into situations where free information about why things are done a certain way is elusive or muddled.”
In the same light, Gen Z also expects feedback to be immediate. Even when it comes to watching their favorite TV shows, they’re used to getting content instantaneously, said Jake Aguas, generational expert and Biola University professor of human resources.
“Streaming didn’t exist for other generations” when they were young, he said. “You had to wait to watch a show. It was part of the process.”
Patel knows feedback is key to doing a good job. But if it isn’t delivered properly, the criticism can be detrimental.
So what might that look like? Managers withhold critiques for weeks or months, preventing her from immediately applying them to her work. Or they focus solely on what she did poorly, without explaining why and how to do better. Or they might deny her the chance to explain herself or play a role in finding a solution.
Gen Zers who spoke to The Washington Post said they view work differently from other generations who sacrificed their time, well-being and family lives for jobs that often didn’t value them as people. Instead, they want to be themselves at work, feel that their voice matters, and that their managers are empathetic and will invest in relationships with them. They also value context on why things should be done in certain ways.
“Every single interaction does matter,” said Sarah Warren, 26, who is a Los Angeles-based executive director and co-founder of a mental health nonprofit for healthcare workers. “You’re dealing with human beings. You can help stop burnout through vulnerability and compassion.”
Warren, who previously worked as a nurse, said she once had a manager who constantly pulled her aside to tell her she was doing things wrong. The manager also patronized her at times, comparing her to her daughter and commenting that her scrubs were too tight. She felt miserable.
She instead would’ve preferred the chance to converse about how things could be done differently versus feeling shamed for her mistakes, she said.
Context is key, so short, quick critiques without explanation can be anxiety-inducing, Gen Zers said. That can lead to the young workers filling in the blanks with self-doubt or negative assumptions that managers never intended.
Shad Brown, a security coordinator at 3M, said if he sees unexpected meetings pop up on his calendar or short vague messages from supervisors, he gets nervous.
“Whenever I receive an instant message that says, ‘I need to talk to you,’ I immediately think, ‘Oh no, is this bad?’” he said. “It does cause anxiety and gets the blood pressure going.”
He also said receiving harsh feedback at the end of the day on Friday would be a nightmare because he would probably stew over it all weekend and have trouble sleeping. Tact is key in critiques, Brown said, meaning: Attack the problem. Don’t attack the person.
Young workers also want a voice in helping fix problems versus just being told what to do.
Angel Davis, a 22-year-old social media assistant for the educational tech company Quizlet, said this helps her avoid repeating mistakes. One of the worst things a manager can do is tell her she did something wrong and then fix it without any conversation.
“It would be confusing and demotivate me,” the New York resident said. “If you’re going to redo my work, why did I do it? And if you can’t explain things to me, I’m never going to fully understand.”
When young workers get to know their manager’s personality and perspective and feel like their manager cares about them personally, Gen Zers said, it helps frame any feedback. Regular check-ins, even if they’re not work-related, and asking questions about how they’re feeling aid in building those relationships.
Joel Velez, a 24-year-old digital marketing specialist in the Milwaukee area, said he appreciates when managers take a counselor-type approach and create a culture of openness and empathy. Even a phrase as simple as “feel free to ask questions” helps quell anxiety, Velez said. “It’s a good reminder that this is a learning environment.”
As a manager of Gen Zers, Hannah Tooker has learned to tailor feedback to her young workers’ individual personalities and learning styles. The Phoenix-based senior vice president of marketing agency LaneTerralever, said that, unlike managing other generations, she has to balance emotional and business needs — and her young workers have not been afraid to ask for changes.
“I have to understand how they communicate and what they want to talk about,” said Tooker, a millennial. “They keep me on my toes.”
Young workers say older generations are wrong to label them as lazy or soft. Instead, they just want to bring humanity back to the workplace. Gerhardt, the generational workforce expert says, all managers should ask: What is your goal in providing feedback? And is your approach working?
Workplaces don’t have to change. But young workers will choose the environments where they feel most comfortable, experts say.
“There’s a little ‘us versus them,’ and, ‘If I couldn’t have this, then I’m not going to do it for anyone else,’” Gerhardt said. “But we need to get back to the idea that we want the next generation to do better than we did.”
For months, a pivotal question in American politics has revolved around the impact of positive economic news on the Presidential race. Despite robust growth in employment, GDP, and a decreasing inflation rate, President Biden’s approval rating for handling the economy has hardly changed.
Key Economic Indicators
1. Exceptional Job Growth: The economy added 303,000 jobs in March, with the unemployment rate remaining at a historic low of 3.8% for the twenty-sixth consecutive month.
2. Record Employment: The economy has added 2.9 million jobs over the past year and 15.2 million since Biden's inauguration. Currently, there are 5.8 million more employed Americans than before the COVID-19 crisis began.
3. Decreasing Inflation: The inflation rate has dropped from 9.1% in June 2022 to 3.2%, and hourly wages rose by 4.1% in the twelve months leading up to the report, indicating contained inflation.
Three Theories for Unchanged Approval Ratings
1. Prices Theory: Despite lower inflation rates, the overall cost of living remains high. For instance, while some prices have not increased significantly, items like secondhand vehicles are notably pricier than pre-pandemic prices.
2. Lags Theory: Public perception might take time to align with the changing economic environment, despite improvements in consumer sentiment and optimism.
3. Vibes Theory: Subjective economic feelings might not be in sync with the factual economic climate, creating a disconnection referred to as a "Vibecession."
Evidence and Poll Findings
1. Poll Contradictions: Polls from battleground states reflect negative economic perceptions, even though economic data suggests otherwise. The majority believes the economy has worsened, contrary to economic statistics.
2. Partisan Influence: Hyper-partisanship and information bubbles play a role in shaping economic perceptions, but negative sentiments aren't limited to any specific political leaning.
Media Influence and Economic Narratives
1. Impact of Media: Economic news coverage has been increasingly negative since 2018, potentially influencing public perceptions.
2. Recent Shift in News Sentiment: However, the news coverage reflected positive economic developments in late 2023, suggesting that consumer sentiment may have picked up in response.
3. Lagging Economic Story: Despite recent improvements and changing news sentiment, President Biden’s economic poll ratings have not substantially shifted, potentially due to persistent lags in perception changes.
The disconnect between economic realities and public perceptions presents a complex picture. Despite the positive economic indicators, public sentiment regarding the economy and President Biden's approval ratings is not commensurate with the economic data. This gap warrants further examination and highlights the multifaceted nature of economic perceptions in the political landscape.