Increasing Labor Market Challenges

 GORDON REPORT

Increasing Labor Market Challenges

 

Employment volatility and chaos continues across all business sectors. This trend will continue into the foreseeable future due to uncertainty about how tariffs and other shifts in government policies will influence the economy.

 

Employers have pulled back some hiring and laid off some workers. However, the lack of sufficient educated/skilled labor persists. A National Federation of Independent Business survey (7/23/25) found that 33 percent of businesses reported job openings they could not fill. Twenty-nine percent had openings for skilled labor.

 

The Bureau of Labor Statistics (BLS) JOLTS June release reported that about 500K manufacturing jobs, 1.1M professional and business service jobs and over 1.6M health-care positions were vacant.

 

The most recent BLS employment report (8/1/25) signaled employment troubles due to downward revisions in the May and June employment numbers. The President responded by firing the BLS Commissioner. He claimed, without any proof, that the numbers are being politically manipulated. The BLS has experienced difficulties in gathering data due in some part to deportations and tariff shifts, but this action suggests that shooting the messenger will solve them.

 

This move and the potential politicalization of future BLS reports will further erode trust in U.S. government statistics. Without impartial, dependable data on wages, inflation, and other aspects of the U.S. economy, policymakers, investors, and businesses both domestic and foreign will find decision-making more difficult. How can businesses hire or invest if because of uncertain tariffs and economic data, they don’t know what the costs of goods or services will be, or from which sources they will be able to buy at competitive prices?

 

On another important job-related front, a recent Korn Ferry survey (7/29/25) on AI reported that about 80 percent of U.S. companies said that this technology is a top priority in their current business strategy.

 

Rather than just focusing on using AI for labor cutbacks, firms also need to concentrate on upskilling their workers to create strong human-AI partnerships that will better spur innovation and growth. Every business must carefully consider what skills, roles and functions AI can replace and which ones it should not.

 

AI can synthesize large amounts of data, but the quality and relevance of the data is crucial. People, therefore, need to grow their abilities to analyze and evaluate both information sources and AI output. Contrary to what AI promoters claim, human possession of these skills will never become irrelevant and will play a vital role in the growth and prosperity of businesses and organizations and the overall health of the U.S. economy.

 

Edward E. Gordon is the founder and president of Imperial Consulting Corporation in Chicago. His firm’s clients have included companies of all sizes from small businesses to Fortune 500 corporations, U.S. government agencies, state governments, and professional/trade associations. He taught in higher education for 20 years and is the author of numerous books and articles. More information on his background can be found at  www.historypresentations.com . As a professional speaker, he is available to provide customized presentations on contemporary workforce issues.

Tallahassee, FL We are seeing a decline in employment in the region. Our unemployment rate is increasing, and we are handling some local closures and layoffs. Traffic to the career centers is on the rise. This is at a time when we are flat-funded and constrained on how to spend our funding by the state and federal governments.  Should the economy shift to a recession in the coming months, the workforce system across the country will be overwhelmed and underfunded to meet the increasing demand.

Jim McShane