Detroit Regional Chamber > Media Coverage > COVID-19 Upended Michigan’s Labor Market: Here’s Where the Workers Went

COVID-19 Upended Michigan’s Labor Market: Here’s Where the Workers Went

October 25, 2021
Detroit Free Press
Oct. 25, 2021
Adrienne Roberts 

Throughout the pandemic, Amanda Scully has been taking classes while working at Build-A-Bear Workshop at the Somerset Collection in Troy. The store closed when COVID-19 hit, but she received unemployment benefits and then went back to work when the store reopened in July of last year.

When Scully, 24, was called back, she worked a similar number of hours compared with before the pandemic, but the job was noticeably different.

“A lot of people are angry with us because we don’t have certain things in the store because of supply chain” issues, she said.

One day, she opened a newsletter from Oakland County that advertised a free certified logistics technician training program. The eight-week program, a partnership between Oakland County Michigan Works!, Oakland Community College and PepsiCo, promised jobs coming out of the program starting at $15-$21 per hour, with opportunities for advancement.

Scully jumped at the opportunity.

“I wanted more stability and some jobs are more in demand than others,” she said. Her current job also doesn’t offer benefits, and that’s something she’d like in her next job.

Finding something better

When she graduates from the program and starts working in a new industry, Scully will join more than a third of Michigan residents ages 18 to 29 who were employed prior to the pandemic and changed jobs over the last year and a half, a recent poll by the Detroit Regional Chamber found.

The poll, conduced by Glengariff Group Inc., illustrates just one of the many ways Michigan’s labor market has changed during the pandemic.

“The pandemic has caused people to rethink the choices that they’re making,” said Susan Corbin, director of the Michigan Department of Labor and Economic Opportunity.

“A lot of older Americans are choosing to maybe retire earlier,” she said. “And because of the labor shortage, people, particularly who were in low wage jobs previously, have a lot more options.”

The same Detroit Regional Chamber poll found there was a 5.9% drop in the labor force participation rate — a measure of people working or actively looking for work — for Michigan residents ages 50-64 throughout the course of the pandemic, and a 5.4% drop for those 65 and older. That’s the sharpest decline compared with other ages.

Overall, Michigan’s labor force participation rate is 59.3%, according to September data from the Bureau of Labor Statistics, which ranks Michigan at 41st out of 50 in the nation. Before the pandemic, in February 2020, the state’s labor force participation rate was 61.6%.

4 trends behind the lack of workers

Jennifer Llewellyn, the director of Oakland County Michigan Works!, said even after working in workforce development for 23 years, she has never seen a labor market like this.

“It’s a perfect storm,” Llewellyn said. She attributes it to four trends:

1. Women leaving the workforce. Primarily due to K-12 schools going online last year and continuing child care issues, 200,000 women have left the workforce in Michigan, she said, citing a report from the Michigan Bureau of Labor Market Information. “Quite frankly, we just we can’t afford to lose that many women in the workforce,” Llewellyn said.

2. Lack of engagement on the part of employers. Women are just one of several groups that need to be reengaged, she said. Veterans, people with disabilities, retirees and individuals doing contract work or working in the gig economy are just a few in this group. “Are employers posting jobs in a way that says these are all the benefits and opportunities that we have available?” she asked. “Are they outlining career pathways and opportunities for advancement even when they’re recruiting new employees?”

3. Fear of getting sick. COVID-19 also is a reason Michigan residents may be out of the labor force, especially if they have preexisting health conditions or are caring for a child that can’t be vaccinated or a parent at home. Llewellyn said this could especially affect people at retirement age, who may have realized with the threat of themore easily transmissible delta variant that it’s not worth risking their own or their family’s health to continue working.

4. Working conditions. Finally, Llewellyn is seeing that workers want better jobs and more flexibility. “They want to work in a better environment, they’re looking for higher wages, they’re looking for more work flexibility, the opportunity to work from home or work in a hybrid model,” she said.

Changing personal priorities

That idea of looking for better work is affecting both younger adults, like Scully, and executives and older workers.

Peter Bridges, senior managing director at the Townsend Search Group in Birmingham, an executive search firm, said the pandemic has been an opportunity for people to self-reflect.

“Executives are no exception,” Bridges said. He said in 2020, the firm saw a “surprising” number of people choose to retire.

“We also saw people take roles that maybe were a bit more modest relative to their prior career trajectory,” Bridges said.

Gina McKague, owner and founder of McKague Financial in Livonia, is also seeing clients who are choosing to retire for personal reasons, such as not wanting to be stuck on Zoom calls all day working remotely, and have enough money to retire.

One of her clients, a 65-year-old woman in metro Detroit who said she wanted to remain anonymous because she didn’t want to disparage her former employer, retired from being a nurse manager in August after she was left with few resources in the pandemic.

“I liked my job but it became harder to do because I didn’t have nurses,” she said, citing examples of nurses quitting, nursing schools not graduating as many students compared with prior years and struggling to compete with staffing agencies who hire travel nurses and can pay as much as $100 per hour.

“I thought, ‘You know, you have worked for 43 years and it is time to hand over the baton,’ ” she said.

She said she probably would have worked for longer if conditions were different, but she said her house and other debts are paid off, and she and her husband have saved for retirement.

Corbin said that’s a missed opportunity to keep a qualifiedperson who isn’tquite ready for retirement yet, but who may be ready for a transition, in the labor force.

Forced to leave the job

But McKague said in many cases in the pandemic, she has had clients say they were forced into retirement because their role was eliminated, the company was going out of business, they feared getting COVID-19 at work, or they were unwilling to get a company-mandated vaccine.

“They are having a hard time getting another job because (employers) don’t want to put money into training them and don’t want to pay wages that they were earning,” McKague said.

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