In March of this year, the U.S. saw a record high of 8.1 million job openings. Many businesses are now struggling to find workers as they reopen and return to their normal operations. The U.S. Chamber of Commerce has openly called out to Washington to make way for more foreign workers to enter the country.
Worker Shortage in the U.S.
The Chief Policy Officer at the Chamber of Commerce, Neil Bradley, told CNN Business, “worker shortage cannot be solved in the long run without ramping up immigration.” “We’ve never seen a situation this broad-based across the country where businesses are having to turn down work because they simply can’t find the workers to do it,” Bradley said. “This crisis is not going to go away.”
Many of the companies rely on H-1B and H-2B visas for an inflow of laborers. However, the H-1B uses a lottery system to pick the candidates who are considered for the visa. Both visa categories are heavily subscribed, which shows the dependency of the companies on foreign workers. The irony is that the companies’ workforces depend on the winning of the lottery.
“For several decades, immigration has been a key component of meeting the needs of a growing economy. However, immigration levels, particularly employment-based immigration, have been largely flat,” Bradley said.
The Chamber of Commerce has knocked at the doors of Congress and the White House requesting them to double the cap on employment-based visas. A request was also made to double the H-1B temporary worker visa and the H-2B visas for seasonal workers and to indulge in another step to ramp up immigration.
Predictions of the Labor Market
Economists have predicted that the U.S. invariably will have to rely on foreign workers due to our aging population. This aspect has not been considered in formulating immigration policies. On the contrary, many leaders have aimed only at slashing the number of immigrants entering on work visas to ensure that Americans are employed first.
“Immigration was completely upended by the pandemic,” said Bradley. “Go to any resort town in America. Where you would normally have individuals on temporary J-1 visas, they are nonexistent.” “The survivability of your business comes down to how lucky you are in the lottery,” Bradley said.
Chief economist Mark Zandi at Moody’s Analytics told CNN Business that the reopening of childcare and daycare centers along with the expiring of unemployment benefits in the coming September will likely resolve the worker shortage issue.
“But labor supply will be a long-run issue, just like before the pandemic,” Zandi said. “There are reasons to believe it will be a bigger problem post-pandemic because immigration is a shadow of what it was.”
Actions Taken by the Government
On May 25, 2021, noticing the deficit of laborers in the market, the Department of Homeland Security and the Department of Labor, increased the visa cap by another 22,000 visas to non-agricultural workers.
The Chamber of Commerce remains optimistic that the shortage of workers will pressure lawmakers to increase legal immigration. Everyone will feel the impact of the shortage of workers when farms, warehouses, amusement parks, and landscaping companies do not have enough workers to operate.
“Pressure is only going to continue to build to address this workforce shortage,” Bradley said. “There is a reasonable chance Congress can act, probably in a piecemeal fashion, to begin to address these issues.”
Efforts to Solve the Worker Shortage
Many states are noticing that due to the states being closed, many are unwilling to return to work. One way the states are encouraging people to do so is by making sure childcare is available, and also by helping parents with childcare costs. On May 13, Arizona announced plans to reopen using its funds allocated under the $1.9 trillion American Rescue Plan to provide for three months of childcare costs to those who are making less than $52,000 a year, who return to work after collecting unemployment benefits.
“We have to find a way to bring [women] back to work,” Minneapolis Federal Reserve President Neel Kashkari told CNN‘s Poppy Harlow on Tuesday.