U.S. businesses face a hiring crunch, report says

An April 2021 report by The Conference Board, based on an online survey, shows that businesses across the U.S. are having immense difficulty in finding qualified hires. The crunch is especially pronounced for organizations that employ mostly industry and manual service workers.

Some 230 HR executives from U.S. businesses, many of them employed at large corporations, weighed in on the pandemic’s effect on the workforce and workplace in the survey. The latest survey is a follow-up to similar ones conducted by The Conference Board in April and September 2020.

 

Findings

Attracting qualified workers is a growing challenge: The report finds 80% of businesses with a majority blue-collar workforce are experiencing difficulty in finding qualified candidates, with 25% describing the experience as “very difficult.” Pre-pandemic, only 4% of respondents reported difficulty hiring. Additionally, 60% of companies hiring white-collar employees cited recruiting as a pressing problem.

Retaining staff has become more arduous: Retention is also a predicament for a growing share of businesses. In the survey, 49% of organizations employing non-desk workers and 28% of employers of professional and office workers reported challenges with retaining employees.

Accelerating wage growth: The hiring crunch bodes well for workers. With companies vying to attract and retain talent, some employers are eyeing wage hikes and offering more employment incentives.

Remote work to stay the course: Nearly 40% of the HR leaders who responded to the survey expect a significant number of their employees — 40% or more — to continue working remotely even after the pandemic is contained. This figure has more than doubled since the April 2020 survey, when only 19% percent of respondents anticipated remote work to remain.

Productivity-well-being tradeoff: Almost 60% of companies reported increased levels of productivity over the past year. However, higher productivity may have come at the expense of employees’ well-being. More than 70% of survey respondents reported a surge in employee burnout and a jump in the number of employees seeking mental health support.

The hybrid model to gain steam: More than 70% of surveyed organizations plan to reopen by October. Correspondingly, over 40% of respondents anticipate their organization to sponsor a hybrid workforce to tackle what some analysts predict will be a mass employee turnover and exacerbated hiring crunch.

What’s ahead

Amid the reopening economy, as more businesses aim to boost output to meet pent-up demand, companies across the U.S. economy are likely to encounter significant disruptions in the wake of COVID-19. The survey highlights these key business challenges in coming months:

• Recruiting qualified employees; retaining existing ones.

• Adjusting to meet the needs of primarily remote workers.

• Addressing deteriorating staff well-being.

• Managing a safe return to the office.