July 19, 2021


Snapshot USA: What Maine Tells Us About the Labor Shortage (Roger Lowenstein, Jul 15, 2021, Intrinsic Value)

Many of its former mill workers were never retrained, and simply dropped out of the work force. As manufacturing declined, various indicators of social dysfunction, including depression, suicide, opioids- and alcohol-related deaths, skyrocketed. Rural counties became highly dependent on social services.

Tourists visiting galleries and antique shops may not notice these dropped-out workers in the rocky seaside villages like the one where we have a second home. But they are here.

The problem of the white male worker, the problem of his disaffection, has been the political story of the decade. In Maine, it is the story, because Maine is the whitest state in the nation (less than 2% is African-American).

Maine is also the oldest state, with a median age of 44.7 compared to 38 nationwide. A high school principal in far northern Aroostook County, famed for its potatoes, once joked that their biggest export crop was the top third of the senior class. Yes, Maine leads the nation in lobster production. But what its lobstermen earn in a year, Nevada casinos gross every ten days. It isn't enough. So the young aren't staying.

The mystery is, jobs are going unfilled. Signs offering higher wages and signing bonuses line the eateries along Route 1. As one former food service worker explained, sort of, to the Bangor Daily News, "Restaurants are a grind."

This summer, the state offered a $1,500 bonus to people on unemployment who returned to work. It got few takers. Other programs seek to lure vacationers and others into moving here. The problem remains -- really two problems.

First, Maine has a people shortage. At 43 people per square mile, it's only half as dense as the U.S. overall. Neighboring New Hampshire is three-and-a-half times denser. Even Colorado is denser than Maine. (Judged from the Census tables, Maine can seem hardly a part of New England at all. Its median household income ranks 36th, ahead of a cluster of southern states. It ranks below average in poverty, health insurance coverage, and disability recipients, but ahead in high school graduations and Covid-19 vaccinations.)

Not surprisingly for an older state, deaths outnumber births. Its population is growing (just barely) thanks to a trickle of immigrants. But it's truly a trickle: only 4% of Mainers were born outside the U.S. In the country as a whole, 14% were.

The other significant issue is labor force participation, that is, the percentage of those who are here working or looking for work. In 2000, 69% of Mainers 16 and older were in the labor force. Now, only 62% are, a stunning drop. Maine was hit hard by the pandemic, due to its high proportion of tourism workers. But that's almost besides the point. As John Dorrer, a retired labor economist in Maine, says, the problem is long-term, and structural.

In many ways, the rest of the U.S. is better off. It has higher population growth, more immigrant men (who work at higher rates), more skilled workers. But if you look at the direction of the U.S. labor market, not so much. Even with the number of jobs down by 7 million from the pre-pandemic peak, the number of unfilled jobs is at an all-time high.

Posted by at July 19, 2021 12:00 AM