Overcoming Labor Shortages and Skills Gaps

by Diane M. Calabrese | Published March 2026

 

 

In November 2025 there were 7.1 million nonfarm job openings in the United States. That’s according to the U.S. Bureau of Labor Statistics (BLS.gov).

BLS will release December 2025 data on February 3. But as we write in mid-January, the expectation is the number of openings will continue to hover around seven million as it has for several months.

The positive view, that there is a lid for every pot, gets clouded by one reality. Lids may be in the wrong place and difficult to find, just like potential hires.

Even readily accessible lids may be a less-than-good fit if they have not been properly maintained. This is true for employees who have not been given regular opportunities to sharpen their skills.

Naturally, a kitchen in disarray can be made right by sorting and reorganizing pans, lids, and all else and adding where necessary. Are employers reporting labor shortages and skills gaps because of disorganization?

Yes, to some extent. But only part (typically only a small part) of the responsibility can be put on an employer.

In fact, the list of those contributing to labor shortages and skills gaps is so long that almost no one can evade responsibility. Reduced expectations for students in many K-12 settings across the nation gets a significant amount of the blame, but that’s too easy.

Everyone bears responsibility for not encouraging responsibility among the youngest members of communities. “Please,” “Thank you,” “Pardon me,” “May I help you,” “May I take a message,” and even, “Have a good day,” are not the standard fare in many parts of the country.

It takes self-discipline to be a reliable employee and maintain skills, and young people mirror what they see in older role models.

The short of it is this: There’s nothing like ensuring that young people grow up with a full appreciation of their agency and their responsibility to themselves and others. It’s the surest way to encourage them to participate in the workforce and continue learning after they leave high school and college.

Fortunately, it’s never too late to realign priorities. An apprenticeship model is one good way to match those who want to learn with those who can teach them—all in a real-world setting.

Apprenticeship USA (ApprenticeshipUSA.gov), under the umbrella of the U.S. Department of Labor (DOL.gov), exists to consolidate, disseminate, and fund (through grants and tax credits) apprenticeships. Part of that consolidation includes an up-to-date and navigable list to state programs that also help employers defray the costs of apprenticeship programs.

About two-thirds of the states have some sort of cost sharing in place, usually in the form of a tax credit. Every business owner reading these words who has not checked the status in his or her state should do so. A tax credit may be just what’s needed to allow an apprenticeship program to be established or make it easier to sustain an existing program.

The DOL has a multi-layered and growing program in place to invigorate the workforce and the workplace. More about that in the last section.

 

Industry View

There was a time when a blacksmith meant everything to the mobility of a community. Things change.

Right now the nation needs workers who can take roles in shipbuilding. Copywriters, on the other hand, are having their field transformed by AI.

Although we cannot suggest to every student who wants to pursue a career in copywriting to enter the world of shipbuilding, we can remind them of blacksmiths and the importance of thinking things through. Similarly, the idea that everyone should become a coder—advanced for several years now—has already been demonstrated to be a bad one with AI capable of coding itself.

Gus Alexander, CEO of the FNA Group in Pleasant Prairie, WI, tells us some of what his company has done to both keep employees and to counter skills gaps. Let’s start with retention.

“Retain the labor you already have,” says Alexander. He adds that often retention gets overlooked. “We targeted retention levels with ‘stay’ interviews—why they should stay—versus exit interviews,” explains Alexander. “In addition, we provide attendance bonuses that tie to reliability and not overtime.”

Acting on initiatives that are likely to increase the desire of employees to stay is also part of the mix. “We learn and practice skill-based pay progression, which is a clear path to higher retention,” says Alexander.

Improving the workday experience is a key element too, says Alexander. “Ergonomic improvements—because fatigue is a turnover driver—predictable schedules, and  strong frontline supervisors have boosted retention,” he comments

“Stopping attrition is cheaper than hiring,” says Alexander. In that context cross training and skill flexibility are important.

“We build multi-skill operators instead of single-task specialists and create a skills matrix and certify operators for two or three stations,” explains Alexander. “To support this, we use floaters to cover absenteeism and bottlenecks.”

With employees capable of fulfilling more than one role, there are fewer production stoppages necessitated by an employee missing work. At the same time, some non-core work functions—packaging, kitting, and subassemblies—have been outsourced to allow focus on core functions.

Analogous to the stay versus exit interviews is the “labor replacement” versus “labor leverage” shift in company culture, explains Alexander. “What I mean is a shift in mindset from ‘how do we replace people’ to ‘how do we make each person dramatically more productive.’”

There’s been success with shift premiums instead of increased base wages and with referral bonuses, says Alexander. The strategies bypass the wage inflation of raising base pay. They also “keep scarce labor focused on value-added production.”

Adopting technological solutions has helped to reduce stress caused by scarce labor, says Alexander. A MES [manufacturing execution system] reduces manual tracking and reporting. Predictive maintenance reduces emergency repairs. Digital work instructions improve clarity and outcomes. AI tools, such as those used in scheduling, result in optimal shift planning and reduce overtime burnout.

“Our philosophy is labor must be treated as a scarce strategic resource, not a variable expense,” says Alexander. He adds that labor shortages in manufacturing are structural and not temporary.

“Reliance on traditional hiring alone exposes the business to missed production targets,” says Alexander. Such reliance also contributes to “escalating overtime and wage pressure, quality and safety risk, and inability to scale during demand spikes.”

 

ETA

The Employment and Training Administration (ETA.gov) at DOL aims to help businesses find the qualified workers they require. It offers an array of services, all of which focus on matching individuals who want to learn and work with companies that need them.

ETA aligns with the American Job Centers (AJCs), which also fall under the DOL umbrella. AJCs strive to bring what DOL labels “untapped sources of workers” into the labor force.

The types of assistance businesses can get from AJCs include recruitment and screening, training and education, retention and up-skilling, and transitioning. There are a variety of funding mechanisms through AJCs—particulars depend upon state and local emphasis of the AJC.

Significant, though, is that the funding can be used in a variety of ways, including on-the-job training, incumbent worker training, and registered apprenticeship. It is understandable that many employers do not want to add more connections to government entities to their processes, but the workforce information provided by DOL and its sub-entities offers many good ideas that can be tailored to a particular business.

More than identifying some good ideas, however, interaction with AJCs offers an excellent way to learn about the young people who want to learn and find engaging remunerative work. Anyone who walks dogs very early in the morning knows that Amazon and Uber delivery vehicles are already coursing the streets before 6 a.m.

Not every independent delivery driver is a young person. But every independent delivery driver is someone who wants to work, has initiative, and is determined to get the job done.

Owners of businesses who cannot find enough employees might consider making connections that will allow them to find people open to apprenticeships and training. But first the potential workers must know what’s available.

It’s no exaggeration to note that money-earning roles such as influencer and podcaster are much better known to prospective workers than are those that produce goods and essential services (e.g., distribution of power and water).

One of the most significant things that business owners can do to eliminate labor shortages and elevate skills of prospective workers is to make certain people understand what their business does. On the right course are manufacturers who invite a school class to tour their facility now and then, distributors who do the same, and contractors who give demonstrations (even if only in the virtual world).

In general, though, far too few people understand what it takes in terms of raw material, equipment, energy, logistics, and people to keep the infrastructure of a nation intact. Life can be more interesting than a tally of clicks and views. Get that information out there.

And thereby match up all the available lids with the pots in need of one.