Dive Brief:
- Aging populations, declining fertility rates and decreased immigration are creating global labor shortages — and traditional workforce strategies “are designed for a world that no longer exists,” according to Fault Lines, a report released Feb. 18 from labor market intelligence company Lightcast.
- Employers are creating artificial barriers to employment even as the world is running out of workers, Lightcast said. For example, 66% of job postings globally require a university degree, while only 31% of workers have one, per the report.
- Artificial intelligence has also introduced new volatility into skill requirements, and the sectors facing the most severe labor shortages, hospitality and healthcare, are where AI adoption is lowest, with AI adoption rates of 0.4% and 0.7%, respectively, per the report.
Dive Insight:
Advanced economies in Europe, North America and Oceania currently rely the most on foreign-born workers, but over the next 20 years, immigration into those regions will fall more than 20%, per the report. In addition, “feeder” countries are retaining their own domestic workforce, while developed economies impose new restrictions.
“Regions without high educational attainment are requesting degrees anyway, while more educated societies face a surplus of workers with degrees,” per the report. “Both situations limit opportunities for workers and also constrict talent pipelines.”
In addition, AI’s diverse impact requires specific adoption strategies, the report found, noting that certain jobs, such as executive assistants, editors and interpreters or translators, have jobs where more than 70% of their skills are exposed to AI.
However, only 11% of degrees held by AI engineers are AI-related, the report said, adding that it’s a signal that “degree-based hiring is failing to identify top technical talent.”
“The biggest headlines today, from immigration policy and wars to tariffs and reshoring, are about the exact same issues that drive talent decisions,” Cole Napper, vice president of research and innovation at Lightcast, said in a statement. “Even if you’re prepared to handle one of these fault lines, you aren’t prepared for the others. Organizations need to realize how these problems are interconnected and the disruption is accelerating.”
The report suggested “that labor scarcity is not cyclical, but structural.” Lightcast said in a 2024 report that U.S. employers would soon face “the largest labor shortage the country has ever seen.”
Notably, a December report from JPMorganChase found that workforce shortages have increased in sectors critical to U.S. interests, such as manufacturing, cybersecurity and artificial intelligence, with three-quarters of companies experiencing challenges when it comes to finding qualified talent.
