Report: How Employers Combat Labor Shortages

Report: Online Job Ads Reveal How Companies Are Rethinking How They Recruit—and Reward—Workers Amid Deepening Labor Shortages

Remote work. Signing bonuses. Lowered education requirements. On-the-job training. According to a new report from The Conference Board and Emsi Burning Glass, employers are turning to an array of new tactics to compete for applicants in a historically tight US labor market.

How Employers Combat Labor Shortages: Insights from Online Job Ads Datadraws on real-time analysis of openings posted on nearly 40,000 separate sources, including job portals, corporate websites, and anywhere else on the web where jobs are advertised. This unique dataset—which has tracked over 320 million unique job posts since 2007—reveals the new lengths employers are going to attract scarce talent.

“When US unemployment reached 14.8% in April 2020, few could have predicted the widespread difficulties in hiring less than 18 months later,” said Gad Levanon, PhD, Vice President, Labor Markets at The Conference Board. “Yet the demographic factors that drove labor shortages before the pandemic have returned with a vengeance—especially in blue-collar and lower-paid work. Coupled with reopening pains and reordered expectations around wages and the workplace, employers are facing a historic mismatch between their demand for labor and the available supply.”  

“Our data has tracked the clear shift in bargaining power from employers to workers over the past year,” said Bledi Taska, PhD, Chief Economist at Emsi Burning Glass. “To compete in this environment, companies are taking proactive steps that have become increasingly visible in their job ads—from signaling the enhanced pay and benefits on offer to casting a wider net for prospective hires, whether in terms of credentials, experience, or geography.”

Among the report’s key insights:

More companies are offering bonuses to new hires and including salary transparency in their job ads

• The share of job postings mentioning a starting or sign-on bonus more than doubled between the start of the pandemic (March 2020) and October 2021. The rise of these bonuses has been most pronounced for manual, on-site jobs that do not require a college degree, as well as industries experiencing the greatest shortfalls in available labor—including education and healthcare.
• Likewise, employers are increasingly likely to include salary information in online job ads. This shift began during the tightening pre-pandemic labor market of 2019, but truly took off in 2021 as the economy began reopening and firms scrambled to compete for workers to meet surging demand. Overall, more than 1 in 8 online job ads now include salary data, with blue-collar jobs again leading the trend.

Employers are “downcredentialling”—lowering education requirements (and offering on-the-job training) to reach more candidates

• The share of postings that require a BA for traditionally non-college jobs (i.e., sales, office support, blue-collar, and manual services)has declined from around 18% before the pandemic to 15% or lower in 2021. This downcredentialling trend is a reversal from the historic pattern, when employers would typically tighten education requirements during periods of higher unemployment.
• Such “upcredentialing” didn’t occur during the pandemic—to the contrary, employers have had to combat labor shortages by expanding their view of the ideal hire, and downgrading formerly “must-have” qualifications to “nice-to-have.” This both reflects—and fuels—a surge in the share of young workers entering the workforce without any post-secondary education since the pandemic began.

To help fill the education gap, more job postings now advertise on-the-job training—a trend that started in 2019 and accelerated in 2021. 

The heightened competition for labor is forcing employers to rethink how to attract and retain workers—while acute shortages remain, and over the long term

• The rise of remote work can help firms meet talent shortages—and become more competitive moving forward. One reason pandemic labor shortages have been less stark in white-collar jobs is the availability of remote work. Increasingly, this has extended to recruiting as well, with West Coast tech companies leading the way in advertising remote opportunities to reach potential hires in lower-cost labor markets.
• Companies are learning that higher wages will only take you so far: In the wake of COVID-19, workers are seeking jobs that value their capabilities and offer work arrangements that meet their lifestyles. While boosting pay checks and offering bonuses can give employers an edge in today’s heated market, firms will need to continue adapting to ensure they remain an attractive employer for years to come.
• Companies should take this opportunity to rethink their definition of the ideal new hire. Increasingly, job postings reveal employers are willing to sacrifice the “perfect fit”—including top-notch experience and educational credentials—to find the right hire. Core competencies like adaptability, problem-solving, and communication may become more valued over specific and technical skills that can be learned on the job.

About The Conference Board

The Conference Board is the member-driven think tank that delivers Trusted Insights for What’s Ahead^®. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. www.conference-board.org.

About Emsi Burning Glass

Emsi Burning Glass is the world’s leading authority on job skills, workforce talent, and labor market dynamics, providing expertise that empowers businesses, education providers, and governments to find the skills and talent they need and enables workers to unlock new career opportunities.

Headquartered in Boston, Massachusetts, and Moscow, Idaho, Emsi Burning Glass is active in more than 30 countries and has offices in the United Kingdom, Italy, New Zealand, and India. The company is backed by global private equity leader KKR. www.burning-glass.com