The Future of Work – Why Are Supply and Demand for Skilled Trades So Out of Sync?

In a recent series of articles about the future of work, I explored various challenges and changes knowledge workers will be facing in the coming years. The three posts were mostly focused on white-collar work, drawing from my own experience, but I also want to share some reflections on the confounding misalignment between supply and demand for skilled blue-collar jobs.

There’s no lack of examples, starting with the two largest construction projects in London, the new Crossrail (Elizabeth line) and Tottenham Hotspur stadium, which not only have fallen significantly behind schedule but have also continuously struggled to confirm a finish date. Developers in the city need to pay a huge premium for electricians and other skilled laborers coming from all over the UK, but there still aren’t enough of them. Similar issues are reported in the US where, for example, there is also a massive shortage of capable welders. 

Meanwhile, a shortage of nurses is affecting the NHS’s quality of care. Where I live in North London, the NHS is currently trying to recruit more than 2,500 nurses while managing to hire only 40 or so a quarter. A similar shortage exists among social workers. Outside of construction and healthcare, there is a major shortage of cooks and other skilled hospitality workers.

This phenomenon is particularly troubling when you look at the high poverty rates in the US and UK. While they’ve declined in a booming US economy (dropping from 15% in 2014 to about 12% in 2017), there are still 39.7 million people living under the poverty line. Close to 10 million adults (about 6% of the workforce) are “working poor”, earning very little income, and the rate of working poor is higher among women (~8%) and among blacks and Hispanics (~12%).

A recent report in the UK suggests poverty rates are much higher, with 22% of the population defined as poor, including a staggering 13.4% of working-age people in employment. These numbers have been steadily increasing for a decade, despite lower unemployment.

To summarize this puzzle: in both the US and UK, unemployment is rapidly declining while poverty remains high, and a major job shortage exists in many professions that pay well over minimum wage. I would carefully speculate that tighter immigration policies in both countries will make this problem worse, even if officially there is a willingness to support visa grants to import workers in many skilled trades. 

Negative stereotypes deter younger people from pursuing certain trades, even well-paid ones

While reskilling and upskilling existing workers is important, there is also a need to rebrand skilled blue-collar work to make it more attractive to young people preparing to enter the workforce.

With only 9% of high school students pursuing jobs in the skilled trades, not only are good jobs being left unfilled but the future of affordable energy and indoor plumbing may be at risk. That’s according to Mike Rowe, who hosted the Discovery Channel show Dirty Jobs, where he profiled hundreds of difficult, gritty and occasionally dangerous jobs. He summarized his learnings in a very popular 2008 TED Talk, which he expanded on in his book Profoundly Disconnected.

Rowe challenges the notion that people should follow their passion. Instead, he believes they should figure out what they can do that will be an effective way to earn a good living, which might mean becoming a fisherman or a pig farmer or a plumber. But stereotypes propagated by pop culture and the media are deterring them.  It would be much easier to convince young people to consider training to become plumbers if the image of the profession weren’t so closely associated with the term “plumber’s crack”, for example.

To go back to nursing, the current shortage derives in part from another damaging stereotype – specifically, that the profession isn’t manly enough. Even as healthcare has grown to 18% of the US economy, the female to male ratio among nurses and home health aides is close to 10-to-1.

It’s not just that men feel emasculated by the idea of being a nurse; their spouses, female family members, and patients also tend to view it as women’s work. Some professions stigmatize gender in an even more pronounced way. Male educators, for example, account for just 2.3% of all pre-K and kindergarten teachers in the US.  

Broadly speaking, men’s refusal to consider so-called “pink-collar” jobs is damaging their employment prospects, which is reflected in data released by the US Bureau of Labor Statistics.

The overall employment-to-population ratio is about 60.6%, which is 2% higher than in the early 2010s and consistent with economic improvements in the past five years. (It hovered between 62% and 65% from 1990 until 2009, when it dropped sharply.) However, among men only, there is a sharply different trend line. Though 66.5% of men of all ages are now employed, the rate had been above 70% since 1950 (when it was above 80%). It plunged below 65% in 2010 and still remains much lower than historical standards. 

Long-term outlook

At a time when our political discourse is loudly focused on the loss of jobs through offshoring and automation, the shortage of skilled workers to perform specific, critical jobs is a quieter crisis. Indeed, the misalignment between supply and demand for skilled trades has been largely unaddressed, or addressed at an incredibly fragmented and uncoordinated level, with limited effort by educators and policy makers.

Hopefully, this will change. There’s much that can be done at the policy level to close the gap between supply and demand, like investing in retraining programs for displaced workers who have the right aptitude for skilled trades that are still thriving. At the educational level, it makes sense for more vocational training to be available in high schools.

Stereotypes that are deeply embedded in the culture are harder to change. A generational shift in thinking about gender norms may be required to greatly increase the number of men interested in nursing and early childhood education, for example, through a public awareness campaign to rebrand those professions. It would be a great challenge for an ambitious ad agency to take on.

Ultimately, the societal stakes of closing this gap are high, both in terms of reducing poverty rates and ensuring that critical services we depend on, like healthcare, function at their intended capacity. We need to muster the will to do it.