By Michael Randle

Southern Business & Development has written many times about the issue of a lack of labor and job creation in the U.S., and specifically in the South. SB&D was one of the first media outlets in the nation to sound the alarm that the labor shed in the South was dissipating at rates no one — not even the experts — could predict. We explained that demographics were front and center and responsible for the tight labor market. In short, too many people are aging out of the workforce and too few are being born. It’s that simple. It’s not politics. You could make it political, but really, it is just math.

Sign of the times

The hospitality industry is facing a severe labor shortage. Fast food outlets and others are forced to compete with unemployment benefits to recruit workers. In response, McDonald’s is offering a $500 bonus to new staff, Wendy’s gives them $100 and Chipotle increased pay to $15 an hour. One McDonald’s in Arlington, Va., is offering a $500 sign-on bonus. Wendy’s is offering $100 signing and referral bonuses to some new hires, in addition to same-day pay.

As we have written numerous times, the U.S. and Southern employers are finding themselves in a “skills gap,” yet more than that, they are finding themselves in a “body gap.” There are simply not enough workers to fill available jobs, which are at a record high of almost 10 million today in the U.S.

Walmart is raising the pay for more than 565,000 store employees. The world’s largest retailer announced that U.S. store workers in its front-end, food and consumable, and general merchandise work groups will receive at least a $1-an-hour raise effective September 25th.

In June, a report by the National Federation of Independent Businesses showed that 46 percent of small business owners reported having job openings they could not fill. That figure is more than double the typical average of 22 percent. Seven million fewer people were employed than before the pandemic.

Now, many of those workers are finding jobs. Almost one million unemployed were then hired in July of this year. That is an enormous total for one month.

Then again, that figure dropped to 235,000 in August.

Yet, at the height of the pandemic in the spring of 2020, the nation lost about 23 million jobs almost overnight, mostly in the services sector. Even in the depression of the 1930s, the nation had never before seen jobs lost that quickly. So, as the nation begins to recover, simple math would suggest that there would be months like July with large job creation.

A confusing labor force dichotomy exists in this recovery. For example, the unemployment rate is currently about 5.5 percent. The unemployment rate prior to COVID was hovering around 3.5 percent, which essentially is full employment. So, there is plenty of available labor out there, at least on paper. Or is there?

Some Chick-fil-A stores in Alabama reported this summer that they were closing their dining rooms due to lack of staff. The restaurants that closed their dining rooms also cited “exhaustion caused by a staffing crisis,” according to AL.com. Alabama’s unemployment rate of 3.2 percent in July was well below the nation’s unemployment rate of 5.5 percent.

There are numerous reasons why labor is tight even when there are so many unemployed. The most striking demographic is the fact that every single day last year about 10,000 people on average retired in the U.S., and only 2,230 people turned working age (16) per day. That is a net loss of nearly 8,000 people a day in the workforce, or three million a year. Year after year, that, of course, is not even close to being sustainable.

Retirements are currently probably the biggest single factor explaining labor shortages. During the early part of the pandemic, close to half of the 3.5 million drop in the total workforce can be attributed to retirements. COVID appears to have driven a surge in retirements according to the Dallas Fed.

The Fed said in August that retirees account for an additional 0.6 percent of the drop in the workforce since the beginning of the pandemic, or two million workers that were not counted as retired in just the last 18 months. According to the Dallas Fed, the total size of the civilian labor force prior to the virus was 164.5 million. As of May 2021, the total had dropped to 160.9 million.

But there are other reasons why some companies cannot find labor, even though technically speaking we are not in a labor shortage. Sure, there are over 9 million jobs available, but there is almost an equal amount of those that are unemployed right now. So, where is the labor shortage?

The federal government counts an unemployed American as anyone age 16 to 64 who is actively looking for work. As for those who are “outside the workforce,” President Trump kept pointing out in 2018 that there were “95 million people ‘outside the workforce’ ” when asked about a tight labor market that could slow the economy.

Of course, those “outside the workforce” include students — high school and college — the disabled, the drug addicted, retirees under age 65 and, of course, family caretakers. Ah, the family caretakers!

In addition to millions aging out of the workforce and retiring, there were almost 9 million women who were unemployed at the height of the pandemic. Census data show that 7.5 million Americans are not working primarily because they need to care for homebound children because so many schools and daycare centers were closed due to COVID.

Obviously, if there were more childcare options, our economy could chop into that massive 9 million available job total at a much faster rate. President Biden’s American Families Plan is focused on tax credits to offset childcare expenses, which could bring people who are caring for children back into the workforce.

It should be noted that the vast majority of those 7.5 million people caring for family are women, and those numbers are not calculated in the overall unemployment rate because they are not actively looking for work. That obviously artificially lowers the unemployment rate. If you factored in those family caretakers, the unemployment rate would be close to 7.5 percent.

Since February 2020, more than 2.3 million women have left the labor force and the worker participation rate for women as of this summer was at 57 percent. That is the lowest worker participation rate for women since 1988. By comparison, 1.8 million men have left the labor force since February 2020, many of which are also caring for family members at home.

The current demography is not on our side.

Job creation is not back to normal mode yet. Nearly a million jobs were created in June, but at some point, that number will settle into what has been the average of 180,000 to 200,000 a month over the last decade. If August’s total of 235,000 jobs created is any indication, that will be fairly soon. And once full employment is achieved, job creation will certainly slow.

Let’s repeat this demographic: On average, about 10,000 American are aging out of the workforce (retiring), and 2,230 are entering the workforce each day. That’s currently about 70,000 a month entering the workforce and over 300,000 leaving it.

For decades, the U.S. could count on about 200,000 people on average entering the workforce per month, or turning age 16. In just a few years, that will drop to 50,000 people entering the workforce per month, meaning the creation of 200,000 jobs on average per month will eventually not be needed.

Who has the labor?

Which places are seeing significant in-migration, birthrates and younger workforces in the South? Only Texas (35 years), Oklahoma (37 years) and Louisiana (37 years) are in the top 10 of the lowest median ages in the South. Utah, at 31 years, is the lowest median age of working age folks in the nation mainly because it also has the highest pregnancy rate in the country.                      

SB&D has devised a formula to identify who has the labor in the region. Growing population is the No. 1 factor, but there are others, including the number of college towns, median age and birthrates.

Here are the counties and markets in the South we believe will provide your company with the best labor shed available. In this issue, we are highlighting Alabama, Arkansas, Florida, Georgia and Kentucky. We will cover the remaining Southern states in future issues.

Alabama

Alabama’s unemployment rate is two points below the national rate, which is an outstanding achievement. But there are some standouts in the state when looking for an active labor shed.

Baldwin County
There is labor available in this South Alabama beach county because of its in-migration. The 2020 U.S. Census data ranks Baldwin County as the seventh fastest-growing metropolitan area in the country and the fastest-growing county in Alabama. The new numbers show a 27.2 percent population increase from 2010, with nearly 232,000 residents calling Baldwin County home.

Shelby County
Shelby County’s estimated population is 221,940 with a growth rate of 0.96 percent in the past year, according to the most recent United States census data. Shelby County is the sixth largest county in Alabama.

Auburn
Population in this major college town has grown by almost 25 percent in 10 years. Because of Auburn University and its population growth, there is labor availability in Auburn.

Tuscaloosa County
Like Auburn, Tuscaloosa benefits from the University of Alabama; however, since Nick Saban came to coach the Tide, there has been a massive increase in enrollment of out-of-state students from as far away as California and international markets such as Saudi Arabia. Few of those folks will settle in Tuscaloosa after they graduate.

Hoover
This is the Birmingham MSA’s fastest growing city. The suburb is a major housing and retail center.

Huntsville/Madison County
Huntsville’s military assets at the Redstone Arsenal and other sites attract all kinds of potential labor every year. The Huntsville metro has added more than 64,000 people since 2010 — the largest increase of any metro in Alabama — and a growth rate of 15.3 percent, which ranked third over that time.

Limestone County
Limestone County is adjacent to Huntsville and is drawing a significant in-migration. The Mazda Toyota assembly plant is about to open in Limestone.

Cullman
This North Alabama city and county is an outstanding place to live. It has an outstanding economy as well.

Montgomery
Montgomery businesses are feeling good about the months ahead. In fact, they’re feeling better than any time since before the recession, according to a new study. A quarterly survey of business leaders by the University of Alabama’s Center for Business and Economic Research found that Montgomery executives are now the most confident in the state. Their optimism level of 70.6 was the highest recorded in the history of the survey, which started in 2007. Pretty astounding. The Montgomery MSA, which has lost population for years, is turning that around.

Arkansas

The median age in Arkansas is just over 38 years. The fastest growing part of the state is in the northwest, where Fayetteville and the University of Arkansas is located.

Fayetteville
Fayetteville is now officially the second largest city in Arkansas. The city’s population grew from 73,580 in 2010 to 93,949 in 2020, according to the latest U.S. census figures. The state university is located in Fayetteville.

Bentonville
Bentonville is currently growing at a rate of 6.48 percent annually and its population has increased by 77.11 percent since the most recent census, which recorded a population of 35,301 in 2010. Bentonville reached its highest population of 62,521 in 2021. Bentonville is also the world headquarters for Walmart.

Little Rock

Central Arkansas, including Little Rock, is currently leading the state in population growth with a growth rate estimated at 2 percent. The area is expected to grow slowly but steadily in the years to come with more young people looking for homes in the urban core of Little Rock. The area’s fastest growing business sector is retail, and the city is developing an entrepreneurial culture that is expected to bring in more young college graduates.

Conway
Conway, a Little Rock suburb, is currently growing at a rate of 0.89 percent annually and its population has increased by 16.88 percent since the most recent census, which recorded a population of 58,908 in 2010. Conway reached its highest population of 68,850 in 2021.

Jonesboro
Jonesboro, home to Arkansas State University, is currently growing at a rate of 1.46 percent annually and its population has increased by 20 percent since the most recent census, which recorded a population of 67,263 in 2010. Jonesboro reached its highest population of 80,714 in 2021.

Florida

Florida’s population grew by 2.7 million — or 14.6 percent — between 2010 and 2020, according to U.S. Census data. This is double the rate of overall U.S. population growth. The state for decades has been an in-migration monster with many from the Northeast relocating each year.

Walton County
There is more to Walton County than beautiful beaches. In 2018, census data showed that Walton County was the sixth fastest growing county in the entire United States. Walton County’s estimated population is 80,749 with a growth rate of 4.31 percent in the past year according to the most recent U.S. Census data.

South Florida
Miami-Dade, Broward County and Palm Beach County are by far the state’s most populous counties, with 6.6 million residents. That’s an increase of 8.2 percent since the 2010 census.

Tallahassee
Home to Florida State University, Tallahassee is currently the 12th fastest growing metropolitan area in Florida with a growth rate of 12.4 percent, which is higher than Miami and Tampa.

Gainesville
The University of Florida, located in Gainesville, is a huge driver of the area’s workforce. As of January 1, 2021, the population of the Gainesville metropolitan area is estimated at 290,600, an average annual increase of 2,450, or 0.9 percent, since 2010.

Orlando
Orlando’s median age is 37.7 years, which is, believe it or not, one of the youngest workforces in Florida. Florida’s overall median age is the sixth oldest in the country at 42.5 years. Much of Central Florida’s available labor originates internationally and migrates to the Central Florida region. Like other markets where deaths are out-pacing births, Orlando is a magnet for foreign-born workers. Just last year, the Orlando MSA’s population cracked 2.5 million, catapulting it into Southern Business & Development’s “mega-market” division. (Charlotte also recently joined that group which includes Dallas-Fort Worth, Houston, Northern Virginia and Atlanta along with other MSAs of 2.5 million or more, like Tampa Bay.)

Tampa Bay
Like Orlando, Tampa Bay’s communities of Tampa, St. Petersburg, Clearwater, Sarasota and Lakeland are in-migration magnets for people from all over the world. Tampa Bay is a no-brainer when it comes to available labor.

Lee County
Lee County, home to Cape Coral and Fort Myers, had a population of 54,000 in 1960. Lee County’s population today is almost 803,000. You will find plenty of labor there.

Jacksonville
In recent years, more than half of new residents in the Jacksonville MSA were from international locations. Domestic in-migration data in the U.S. Census Report as detailed by Florida Politics shows that St. Johns County had the third highest rate of county growth in Florida at 4 percent. By percentage growth, St. Johns and Nassau were the third and fourth overall fastest growing counties at 4.2 percent and 3.6 percent.

Sumter County
We had to put this small county in Central Florida on this list even though much of the growth is from retirees. Sumter County’s estimated population is 139,822 with a growth rate of 2.72 percent in the past year according to the most recent United States census data. Sumter County is the 35th largest county in Florida. The 2010 population was 94,278 and has seen a growth of 48.31 percent since then.

Flagler County
Located just south of Jacksonville, Flagler County is growing fast and has also become an in-migration magnet. A coastal community with pristine beaches and proximity to the Intracoastal Waterway, Flagler County has available land for new construction and business-ready sites for any size company relocation or expansion.

St. Lucie County
Labor availability in St. Lucie County flows from three distinct sources — reversal of a decades-long out-commute of workers to other counties, significant population growth, and a focused effort by both St. Lucie Public Schools and Indian River State College (IRSC) to provide career and technical training aligned with the employment opportunities growing out of 5 million-plus square feet of available industrial development. According to a March 2021 study by the Florida Department of Economic Opportunity, there were 110,775 workers living in St. Lucie County. Of these, 69,011 workers (62.3 percent) were employed outside the county. The Economic Development Council of St. Lucie County and its partners began a multimedia campaign this year to let these commuters know about the good-paying job opportunities at home. New census data shows St. Lucie County growing by 18.5 percent over the last decade, from nearly 278,000 to 329,000 residents, exceeding the state’s population growth of 14.2 percent. Port St. Lucie is now the third most populous city in South Florida and the state’s seventh most populous city.

Collier County
This is another growing county and economy that provides companies a variety of labor options. Anchored by Naples in Southwest Florida, Collier County’s estimated population is 398,304 with a growth rate of 1.71 percent in the past year, according to the most recent United States Census data. Collier County is the 17th largest county in Florida. The 2010 population was 322,581 and has seen a growth of 23.47 percent since that time.

Indian River County
Indian River County’s estimated population is 165,395 with a growth rate of 1.68 percent in the past year according to the most recent United States Census data. Indian River County is the 33rd largest county in Florida. The 2010 population was 138,270 and has seen a growth of 19.62 percent since that time.

Charlotte County
Once a sleepy part of Southwest Florida, Charlotte County is really growing and is one of the least expensive places to live in the entire state. Charlotte County’s estimated population is 197,032 with a growth rate of 2.10 percent in the past year, according to the most recent United States Census data. Charlotte County is the 29th largest county in Florida. The 2010 population was 159,875 and has seen a growth of 23.24 percent since that time.

Georgia

Georgia remains one of the fastest growing states in the U.S. Its 10-year growth rate of 14.4 percent is more than 1.5 times that of the U.S. population growth rate. The state will add more people in the years to come. . .population projections forecast a 17.7 percent increase in Georgia’s population by 2030.

Fulton County
This Atlanta county has an estimated population of 1,091,550 with a growth rate of 1.28 percent in the past year, according to the most recent United States Census data. Fulton County is the second largest county in Georgia. The 2010 population was 925,632 and has seen a growth of 17.92 percent since that time.

Gwinnett County
This county’s population has nearly tripled since 1990. Located northeast of Atlanta, Gwinnett County’s estimated population is 954,076 with a growth rate of 0.94 percent in the past year, according to the most recent United States Census data. Gwinnett County is the third largest county in Georgia. The 2010 population was 808,007 and has seen a growth of 18.08 percent since that time. The county is a major draw for international migrants.

Cobb County
A major suburb of Atlanta, Cobb County’s estimated population is 768,283 with a growth rate of 0.53 percent in the past year according to the most recent United States Census data. Cobb County is the fourth largest county in Georgia. The 2010 population was 689,495 and has seen a growth of 11.43 percent since that time.

DeKalb County
At the center of Atlanta, DeKalb County added 10,600 people in the past year, its largest single-year growth since 2000-2001, or nearly two decades. The surge brings the county’s total population to 744,530, according to estimates released today by the Atlanta Regional Commission.

Columbia County
Columbia County, located west of Augusta, is one of the fastest growing in Georgia. Columbia County’s estimated population is 161,988 with a growth rate of 1.65 percent in the past year, according to the most recent United States Census data. Columbia County is the 16th largest county in Georgia. The 2010 population was 124,955 and has seen a growth of 29.64 percent since that time.

Augusta
Augusta is a city located in Columbia County and Richmond County, Ga. Augusta is currently growing at a rate of 0.43 percent annually and its population has increased by 1.93 percent since the most recent census, which recorded a population of 195,844 in 2010. Augusta reached its highest population of 199,614 in 2021.

Henry County
This county south of Atlanta has grown due to lots of economic development projects, especially as distribution has overtaken automotive in the South in the last few years. Henry County has for decades been the distribution center of the Atlanta MSA.

Jackson County
In-migration into this county from Atlanta has been strong recently as some of Georgia’s largest economic development projects in recent years have landed in Jackson County. The county’s estimated population is 78,281 with a growth rate of 3.51 percent in the past year, according to the most recent United States Census data. Jackson County is the 34th largest county in Georgia. The 2010 population was 60,696 and has seen a growth of 28.97 percent since that time, which is really strong.

Fayette County
Fayette County’s estimated population is 116,901 with a growth rate of 1.07 percent in the past year, according to the most recent United States Census data. Fayette County is the 23rd largest county in Georgia. The 2010 population was 106,938 and has seen a growth of 9.32 percent since that time.

Cartersville-Bartow County
Bartow County’s estimated population is 110,458 with a growth rate of 1.25 percent in the past year according to the most recent United States Census data. Bartow County is the 25th largest county in Georgia. The 2010 population was 100,050 and has seen a growth of 10.40 percent since that time.

Kentucky

New data is in from the U.S. Census Bureau, and it shows some changes for Kentucky. The state’s population averaged nearly 4 percent growth. Also, more people moved to urban areas and left rural areas.

Louisville
Louisville has created a hip place for young people and the University of Louisville contributes to that vibe. The current metro area population of Louisville in 2021 is 1,098,000, a 0.83 percent increase from 2020. The metro area population of Louisville in 2019 was 1,081,000, a 0.75 percent increase from 2018.

Shelby County
Shelby County, located between Louisville and Frankfort, estimated population at 50,954 with a growth rate of 1.93 percent in the past year, according to the most recent United States Census data. That is well above the nation’s growth rate of 0.35 percent.

Fayette County
Home to Lexington and the University of Kentucky, the growth rate isn’t very impressive, but it does have a large student population.

Warren County
Here is another growing college town. Warren County’s estimated population is 137,188 with a growth rate of 1.59 percent in the past year, according to the most recent United States Census data. It is the sixth largest county in Kentucky. The 2010 population was 114,341 and has seen a growth of 19.98 percent since that time.

Scott County
Located near Lexington, Scott County’s estimated population is 59,076 with a growth rate of 1.78 percent in the past year, according to the most recent United States Census data. Scott County is the 18th largest county in Kentucky. The 2010 population was 47,274 and has seen a growth of 24.97 percent since that time.

Richmond
Home to Eastern Kentucky University, Richmond is currently growing at a rate of 0.93 percent annually and its population has increased by 17.46 percent since the most recent census, which recorded a population of 31,364 in 2010. Richmond reached its highest population of 36,839 in 2021.

Hopkinsville-South Western Kentucky
Hopkinsville’s labor is enhanced by nearby Fort Campbell. Soldiers and their families are reportedly happy at Fort Campbell, which makes them more likely to succeed at the mission at hand. Sixty-five percent of soldiers stationed at Fort Campbell want to remain there and over 70 percent of retiring soldiers remain in the region.

Owensboro-Davises County
Along with retaining homegrown talent, Owensboro-Daviess County also works hard to attract new talent. The community is the fourth most populous city in the state of Kentucky with an overall cost-of-living index that is 7.4 percent lower than the national average. Every local school system has a 93 percent graduation rate or higher, housing cost is 30 percent lower than the national average, and the community prides itself on being a great place to live, work and play. All these attributes are attractive to new families and young professionals and will continue to help Owensboro-Daviess County’s labor force to grow.  

Eastern Kentucky
Virtually all of Eastern Kentucky’s counties have available labor because of the contracting coal industry.