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Current labor shortage has precedent, says historian

Published: Oct. 28, 2021 at 6:10 PM CDT
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RAPID CITY, S.D. (KOTA) - The national labor shortage brought on by the COVID-19 pandemic is still affecting many businesses in our area. But this isn’t the first time such a shortage has impacted the U.S. labor market.

You may have seen signs at several businesses in the area looking for employees during a historic labor shortage in the wake of the COVID-19 pandemic. But, just how unprecedented is this labor shortage?

Economist and historian Eric Abrahamson of Vantage Point Historical Services said that there was also a labor shortage in the wake of the 1918 flu pandemic.

He said that while there are different circumstances separating the two shortages, they have one thing in common, a shifting economy.

“When the economy is in transition and suddenly you have a group of people who have been trained in doing a certain kind of work, but now the economy wants people who are doing this kind of work,” Abrahamson said. “So, you’ve got a skills gap, and that can feel like a labor shortage, even though that means there are some workers who are out of a job.”

Abrahamson points out that the last pandemic brought about better wages for workers, which caused a booming economy in the 1920s.

He also says new technologies today are allowing for the globalization of labor.

“What the means now is that employers are competing around the world for what may look like a local job,” Abrahamson said. “So, someone who’s hiring here in Rapid City must consider that someone down the street may be getting a job that’s in Michigan or California even though they’re not moving. So, they’re looking at what that wage is that they can get paid by someone in California, compared to a wage in Rapid City.”

Abrahamson notes that the increased use of technology during the pandemic will continue to encourage exponential growth in that industry.

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