Labor Shortages

University of Wisconsin - River Falls

Sept. 27, 1996

Labor Shortages Need Long-Term Solutions

By Ellie Walradth
UW-RF News Bureau

Wisconsin's worsening rural labor shortage won't be solved by quick-fix solutions, according to the author of an intensive state-wide study on the problem.

About 40 rural community leaders from western Wisconsin communities attended a presentation on labor shortages and their solutions offered in a day-long workshop at UW-River Falls on Sept. 27.

Professor Gary Green of the UW-Madison rural sociology department focused on employer, worker and community responses to tight labor markets and low wage labor in western Wisconsin in conjunction. The presentation was tied to an on-going series of workshops to address rural economic development issues sponsored by UW-RF Continuing Education Extension.

Western Wisconsin counties included in the survey are Barron, Burnett, Douglas, Pierce, and St. Croix. Green collected data from employers and workers through face-to-face and telephone interviews from more than 700 employers, with at least 50 from each Wisconsin county.

Green gathered his data on labor supply from phone interviews of a random sample of 300-500 households in each county, with over 6,000 surveys.

The household surveys focused on labor force characteristics, obstacles to job search and training, work history, and individual/family characteristics.

"We can focus on the short-term and try to fix this, but I think we need to begin addressing long-term solutions," Green said.

Green says that communities and firms need to view labor shortages as a collective problem. They need to find collective solutions to improve child care, reduce job turnover rates and improve worker productivity.

"We have to get beyond looking at the narrow view and understand how child care, housing, and transportation all fit into the problem," Green said.

Unaffordable child care, housing and transportation costs are factors Green says contribute to labor supply problems in many communities.

Green said that he is somewhat of an advocate of employer assisted housing programs that have already been established by employers in many communities.

Green noted that labor shortages are affecting about 60 percent of employers in Wisconsin.

Because the manufacturing sector in the Upper Midwest is growing and fewer 16-34 year olds are entering the workforce, there are severe labor shortages, Green said.

The shortages are of unskilled and semi-skilled workers because they can commute to larger cities for higher wages.

Green said that labor shortages are the worst in three main metropolitan or developing areas of Wisconsin: western Wisconsin, Madison and Milwaukee, and the Fox River Valley region.

Green said that employers are using short-term solutions to respond to labor shortages by hiring temporary employment agencies and part-time and seasonal workers.

He urged communities to look past these solutions.

Green suggests employers consider community- or worker-owned firms that have several advantages when compared to other firms, including higher profit rates and greater productivity growth rates.

This strategy for local ownership directly links the interests of the firms with the workers and the community, Green said.

Another strategy Green suggests is to promote manufacturing networks as a means of addressing the collective problem of individual employers.

If employers could jointly invest in worker training, they would have less risk of losing their investment, Green said.

Also, Green suggests employers provide incentives to employees for relocation.

By providing funds that subsidize affordable housing, child care and transportation, communities would provide incentives for workers and employers to stay in the community and invest there, Green said.

Green said that it takes 20 years to produce a worker, and at that rate, the labor shortage problem could continue for a decade.



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