District of Columbia Hit Hardest by National Labor Shortage

District of Columbia Hit Hardest by National Labor Shortage

Hawaii, California and New York seeing the least impact, according to new findings
Georgetown Washington, D.C.

Although the United States is currently facing a nationwide labor shortage — with a record 10.9 million job openings — the reality of that differs slightly between states as the numbers measuring unemployment, job openings and other economic indicators vary by location.

Career resource hub CareerCloud used some of these figures in a new study to measure the impact of the labor shortage crisis in each state.

Its findings reveal that the District of Columbia has been hit the hardest, along with Nebraska and New Hampshire. In comparison, Hawaii was least impacted by the labor shortage, followed by New York and California.

Survey finds states hit hardest and least by national labor crisis

According to a new release from the U.S. Bureau of Labor Statistics (BLS), the unemployment rate in the U.S. hit 5.4% in July 2021 — indicating that about 9 million people are currently unemployed. However, that number doesn't reflect the rate in every state, as Nevada had the highest (7.7%) and Nebraska the lowest (2.3%).

By combining the most recent data from the BLS with the numbers from job boards Indeed, ZipRecruiter and CareerBuilder, CareerCloud found that Hawaii had 0.41 open jobs per person — the fewest of all states — followed by:

  • New York (0.45)
  • California (0.45)
  • Nevada (0.50)
  • Connecticut (0.51)

The District of Columbia ranked at the bottom of the list for work shortages, at 2.37 open jobs per person, with the following states also experiencing the greatest labor shortages in the U.S.:

  • Nebraska (1.80)
  • New Hampshire (1.60)
  • Vermont (1.59)
  • Utah (1.45)

Labor shortage affected by low wages and unsatisfactory work environments

Despite having over 10 million job openings and 9 million people in need of jobs, the fact remains that the county is still experiencing a labor crisis. The CareerCloud study points out that this is due, in part, to the kinds of opportunities that are available right now.

For instance, three of the four industries with the most job openings available report median annual wages that are much lower than the $56,000 national median:

  • Trade, transportation and utilities (median annual wage of $47,452) reported 1,884,000 job openings
  • Education and health services (median annual wage of $51,533) reported 1,683,000 job openings
  • Leisure and hospitality (median annual wage of $25,658) reported 1,650,000 job openings

These jobs are also likely to carry greater risk of coronavirus exposure than others, due to the high-contact nature of these industries. On the other hand, three of the four industries with the fewest job openings available boast the highest median pay (with professional and business services offering salaries just above the overall national median of $56,000):

  • Mining and logging (median annual wage of $82,715) reported 27,000 job openings
  • Information (median annual wage of $85,828) reported 171,000 job openings
  • Financial activities (median annual wage of $78,853) reported 349,000 job openings

Of course, this isn't the only reason why so many people are hesitant to return to work. The COVID-19 pandemic has transformed the way people think about their work and their lives, and many simply refuse to go back to work environments they deem unsatisfactory. A recent survey from GoodHire showed that nearly a third of American workers would "absolutely not" apply for a full-time, onsite job opportunity.

"For the most part, it’s not a shortage of workers that’s the problem, per se. It’s a sign that employers just need to offer better packages of wages and working conditions to attract workers," says Robert Triest, economics professor at Northeastern University.

A different survey from Salary.com found that companies are starting to take notice: Over 6 in 10 businesses plan to increase base wages for their hourly and salaried employees in the next six months.

Methodology: CareerCloud used the most recent data from the BLS to calculate the average of job openings by state in March 2021, as well as those reported by job boards Indeed, ZipRecruiter and CareerBuilder in August 2021.

These averages were then compared to the number of unemployed people in each state in July 2021, the most recent month with BLS data on the subject, to get the final rankings of job openings per unemployed person.