In 2021, following what has been dubbed the “Great Resignation,” many businesses found themselves in the troubling position of having positions to fill but not enough qualified applicants to fill them.
Among other things, 2021 highlighted a shortage in skilled workers. Likewise, new data shows that this may continue to be an issue in the future as fewer and fewer young adults enroll in post-secondary education with every passing year.
In this issue of The Pulse, we look at this phenomenon and how it might impact businesses in the future.
2021 saw a concerning drop in post-secondary students.
Data released in January found that there are currently one million fewer students enrolled in American colleges and universities in comparison to pre-pandemic numbers. In the fall semester of 2021 alone, institutions saw 500,000 fewer undergraduate students.
According to the National Student Clearinghouse research center:
- Enrollment has fallen 6.6% in total since fall semester of 2019.
- This represents the largest two-year decline in over 50 years.
- Community colleges have seen a 13% decline from pre-pandemic enrollment.
- Roughly half the shrinkage comes from four-year programs.
Is this representing a cultural shift?
While the consequences of the pandemic have accelerated this trend, enrollment has been declining steadily over the past decade.
These young adults aren’t just doing nothing. In fact, unemployment is down, and many businesses are struggling to find workers. Instead, many who might have streamlined to college before the pandemic, are now out working, as the wages for unskilled or low-skilled positions continue to increase. And of course, everything else is on the rise too; rent, gas, groceries. The choice between work and school might not be much of a choice at all.
What does this mean for businesses?
While this might have long-terms impact on some of the individuals who are choosing to postpone or forgo post-secondary education, it will also certainly hurt the economy.
Tony Carnevale, director of Georgetown University’s Center on Education and the Workforce, explained the impact to NPR.
“The direct loss to the economy is the workers themselves. If they were trained and ready, they would get higher-wage jobs and they would add more to GDP, making us all richer and increasing taxes, reducing welfare costs, crime costs, on and on. When you hire the crane operator, the crane operator goes and buys groceries. So the grocery clerk has a job.”
Now more than ever, many jobs require some level of post-secondary training. Meaning, workers with anything after grade twelve are increasingly needed.
A drop in post-secondary enrollment means that the future could find even more jobs sitting empty, and a continued skills gap in the labor market. This will leave many businesses struggling to run, leading to issues like decreased tax revenue, inflated prices, production delays, and supply chain issues.
What can be done?
The problem here is not the students – or lack of students – themselves. It’s not even the educational institutions who are to blame. While universities and colleges across the continent are ramping up enrollment incentives and advertising campaigns, it’s going to take a lot more than good marketing to fix this issue.
Pandemic closures and increased cost of living are doing more to deter students than colleges can advertise around.
In the coming years, businesses across North America may see struggles to recruit and maintain qualified staff, as post-secondary enrollment is at a 500,000 decrease in undergraduate students.
While there isn’t much that can be done, on an individual level, to remedy the larger problem, businesses can focus on management strategies and workplace culture to maintain the talent they already have.