The Shrinking infrastructure Workforce Challenge

In looking at the struggle for California to compete for the big federal Infrastructure pot of money, there are other areas of concern. Perhaps the most compelling is that even if California can get its act together, it may not be able to muster up the workforce needed to build the improvements.  In The incredible shrinking infrastructure workforce — and what to do about it, by Joseph W. Kane, (Brookings, Link), we learn the U.S. infrastructure workforce is rapidly losing talent.

Kane describes how the billions of dollars the Feds unleashed for infrastructure projects “has the enormous potential to support up to 15 million new jobs over the next decade, according to the most ambitious estimates. Many state and local entities eligible to receive this funding—think transportation departments, water utilities, and more—are scrambling to secure new pots of money and get workers ready for all the projects to come.”

But the problem with all those news jobs, is that we are hemorrhaging current infrastructure workers and having a hard time finding new workers.  Kane says, “The U.S. infrastructure workforce is rapidly losing talent. As recent Brookings research shows, nearly 17 million infrastructure workers are projected to permanently leave their jobs over the next decade due to a wave of retirements, job transfers, and other labor market shifts. Infrastructure workers are not just construction workers—they are plumbers, electricians, civil engineering technicians, or dozens of other occupations, primarily involved in the skilled trades. And they are responsible for operating and maintaining our roads, rails, pipes, power plants, and other facilities over many decades. Filling these shoes is not simply about patching a pothole or building a bridge—it represents a generational challenge affecting many industries nationally.”

“Yet filling these new infrastructure jobs also represents a generational opportunity,” says Kane. “Infrastructure jobs pay 30% more to lower-income workers and those just starting their careers relative to all jobs nationally, while also posing lower formal educational barriers to entry. But too many workers—especially younger workers, women, and people of color—continue to be sidelined from these careers. The infrastructure workforce is aging, male, and white; only 11% are 24 years old or younger, 18.5% are women, and under a third are people of color. Many prospective job seekers not only lack awareness these positions exist, but they also lack flexible and accessible pathways to fill them, including struggles to gain needed on-the-job training and limited supportive services (e.g., child care, transportation).”

Kane points out, “Difficulties in hiring, training, and retaining a younger, more diverse workforce limit economic opportunity, slow down projects, and pose the very real possibility of mission failure for infrastructure employers, including the owners and operators of these systems. These difficulties are also likely to get worse given the country’s declining—and diversifying—labor force participation. The BLS estimates that the U.S. labor force participation rate—the percentage of the population that is working or actively looking for work—has gone up since the pandemic, to 62.6% last month. However, this rate is still lower than the pre-pandemic level (63.3%), and further declines are projected over the next decade (down to 60.1%)—continuing a longer-term trend as more baby boomers exit the labor force.”

There are big demographic changes in workforce participation, too.  Kane says, “Amid these broader declines, an even more significant change may soon impact the infrastructure workforce: The overall labor force will grow from 161 million workers to 169 million (an additional 4.8%) over the next decade, largely driven by women and people of color—the groups traditionally overlooked and marginalized across the infrastructure sector. From 2021 to 2031, the number of women in the U.S. labor force will increase by 6.1%, while the number of men will only increase 3.5%. At the same time, the number of Black and Latino or Hispanic workers will increase 8.2% and 23.6%, respectively, while the number of white workers will only increase 1.6%. The BLS does not separately report other racial groups—including Asian American and Native American workers—but groups in the “all other” category will grow the fastest (24.1%).

Action is required to produce the needed workforce.  Kane says, “Bridging the infrastructure sector’s talent gaps in the short term needs to coincide with building a stronger long-term talent pipeline, which crucially depends on reaching and supporting more diverse workers. That means conducting more extensive community outreach to reach new and different workers, including additional demonstration projects. That means collaborating with workforce development boards, educational institutions, community-based organizations, and other partners to define hiring and training priorities, expand work-based learning options, and provide more supportive services. That means changing how infrastructure projects are done, including new local hiring standards, procurement strategies, and contracting practices to reach women- and minority-owned businesses.”

In conclusion, Kane says, “The key is for infrastructure and workforce leaders to both recognize the urgency of this challenge and the need to start experimenting with a different approach. Time is fleeting, and the federal money is already flowing.”

NBLC Helped Get Highway 37 Tolling Approved Which Will Fund Improvements

North Bay Leadership Council helped lead the way to raise funding to improve Highway 37, a key commuter route for employees working in Marin and Sonoma Counties coming from the East Bay.  The project is being led by the Metropolitan Transportation Commission to reduce traffic by widening and elevating the roadway in stages, as well as providing environmental improvements to the wetlands along the highway.  Cynthia Murray, CEO, NBLC, testified at a hearing on tolling, that “We feel that as it becomes a bridge it should be treated like other bridges and we really want to make sure that we have a functioning highway before it goes under water, and these improvements are critical in making sure that the road can be raised and widened to meet the needs of the North Bay,” she told the commission.

The California Transportation Commission approved the Bay Area Infrastructure Financing Authority’s request to apply a toll on State Route 37. Part of their approval was because of the support by NBLC.

According to Susan Wood, North Bay Business Journal, (Link), “The unanimous vote, made during Wednesday’s meeting, does not specify the toll amount. The approval came with two amendments: that the Transportation Commission is required to consider toll discounts based on regional, rather than federal income levels. The second amendment requires the commission to update its guidelines for toll hearings.”

Wood said, “Prone to heavy traffic congestion and flooding, Highway 37 is scheduled to receive short- and long-term improvements whose costs will be passed along to motorists. The tolls are seen as a matching incentive to attract state and federal funds.”

“Overall, the project would be a benefit for those working or living in Marin and Sonoma. Two lanes in each direction rather than the single lane section would reduce travel time and allow transit options from Solano County to Marin,” Transportation Authority of Marin Executive Director Anne Richman has said.

“State and regional transportation officials are proposing the toll to help offset a $430 million price tag on the road widening of the road that overall runs 21 miles between Marin and Solano counties from U.S. Highway 101 to Interstate 80,” said Wood. “The road widening is expected to start in 2025 and finish two years later. The project to raise Highway 37 because of flooding caused by torrential rains and tidal surges will cost approximately $6 billion and take 10 to 20 years to complete, according to transportation officials. The highway was originally designed as a toll road when it was built nearly 100 years ago.”

Enough of the Climate Doomerism!

Another challenge is the feeling some people have that all is lost.  We’ve past the point of no return and we are doomed.  That kind of thinking makes people less likely to make change and to avoid taking the steps that will help address climate change.  In We May Not Stop The Climate Crisis. That Doesn’t Mean We Shouldn’t Try, by Brian Kateman (Link) the author says we have more reason for hope now and we need to dispel the doomsayers. Kateman says, “If your personal anxiety about the climate has softened a bit in recent times, you’re not alone. After decades of increasingly alarming reporting on climate change and the environment, fatalistic headlines are beginning to give way to ones that express a different kind of feeling, one that many of us haven’t felt in a long time: hope.”

“The recent shift in the media narrative has been shaped by two ongoing conversations,” says Kateman. “First, scientists and reporters are trying to fine-tune a message that most accurately represents the evidence. Second, some reporters are wondering about the impact of their message on public attitudes towards change. Luckily, it seems to me that the most realistic interpretation of the evidence and the optimal message to motivate change are one and the same: We can make a difference, but there’s a significant chance that we won’t.”

He says, “To observe the shifting media narrative, take last month’s report released by the Intergovernmental Panel on Climate Change for example: Some outlets reported on it in the usual, panic-stricken way; The Guardian, for example, titled its article, ‘Scientists deliver ‘final warning’ on climate crisis: act now or it’s too late.’ But Time Magazine took a more positive tone: ‘The New U.N. Climate Report Has Arrived. Resist the Urge to Despair.’ The author describes his own newfound hope. “’Like many scientists,’ he writes, ‘was disheartened for decades, but today’s report makes me feel more inspired than ever.’”

“Indeed, there’s been a rising tide of ‘climate optimism’ as journalists attempt to walk back some of the most alarmist warnings from recent decades” says Kateman. “In an opinion piece for CNN, Fermilab scientist Don Lincoln relays the success story of how ‘humanity and all life on Earth dodged a bullet’ by phasing out chlorofluorocarbons and other ozone-depleting substances with the UN’s Montreal Protocol passed in 1987.”

“As a result of the Montreal Protocol, Lincoln reports, the ozone layer is now ‘on track to recover in the coming decades.’ This, he says, offers hope that society may be able to intervene in some of the other causes of climate change. More recently, Reuters published an op-ed by strategists Johan Falk and Owen Gaffney of the Exponential Roadmap Initiative. They describe the latest report from the International Panel on Climate Change (IPCC) — the same one The Guardian called a ‘final warning’ — as ‘remarkably positive’ because it indicates that it’s still technically possible for global society to stabilize the rise in climate at 1.5oC, despite the caveat that governments are ‘way, way off target’ in their efforts to meet this goal. Writing for Vox’s ‘Against Doomerism’ project, Hannah Ritchie carefully advocates for a certain kind of climate optimism, one that leads to action rather than complacency,” says Kateman.

“’Climate optimism’ is a notable shift, and it may be a sensible response to the wave of climate ‘doomerism’ we’ve been experiencing in recent years,” says Kateman. “As environmental journalist Elizabeth Kolbert pointed out in an extensive feature for New York Magazine late last year, ‘a diet of bad news leads to paralysis, which yields yet more bad news.’ She’s not wrong; many self-identified climate doomers lament that activism feels futile in the face of certain catastrophe. If we truly don’t believe there’s anything we can do, either as individuals or collectively, we’re unlikely to try.”

Kateman warns, “Of course, optimism carries its own set of risks. By this point it’s clear that denying global warming altogether, or even downplaying its severity, has only allowed the problem to grow. Meanwhile, we’ve seen climate denying politicians elected to the highest offices as planet-threatening human activities continue to expand. An overly positive outlook, just like an overly negative one, could halt our progress.”

“In addition to reducing our much-needed sense of urgency, an over-optimistic view could lead us to make some pretty dangerous gambles, all because we gravely misunderstood the odds. In addition to avoiding both over-optimistic complacency and over-pessimistic defeatism, we need to be realistic. Accurately understanding the most likely future of our planet is essential for both institutional and individual decision-making. Should we, as Elon Musk believes, have lots of children to avoid a purported ‘underpopulation crisis?’ It seems to me that this hinges on whether there will be a planet for them and others to comfortably live on in fifty years.”

Kateman points out, “Unwarranted, unqualified optimism feels like a form of toxic positivity. Scary feelings are met with empty assurances, rather than addressing the problem directly. In my work, I often speak to food and environmental advocates who feel like they’re surrounded by cheerleaders while the world literally burns around them. They’re told to keep a positive outlook, sometimes by the very same governments that are actively making choices that endanger the planet. This unrelenting feel-goodism denies reality and undermines the importance and urgency of their work. Unrealistic positivity about the state of the climate, as some have pointed out, is essentially a form of gaslighting.”

“The fight against climate change isn’t an all-or-nothing battle. There are at least some ways we can make meaningful changes that positively affect the lives of humans and other animals,” says Kateman. “Some progress is always better than none, and if we can delay or reduce coming disasters, we absolutely should. We can’t give up, but we don’t need to kid ourselves into believing we’ve already won. Few activists have ever proclaimed that their respective causes—racism, sexism, and so on—would ever completely resolve. But even problems that initially seem overwhelming and insurmountable may be able to be managed until better solutions emerge.”

Kateman ends with this observation. “An estimated 3,664,292 babies were born in the U.S. in 2021 alone. We owe it to them to do everything in our power to keep the planet comfortably habitable for the duration of their natural lives, at the very least. Humans and many other species may eventually go extinct as a result of industrial activity. But that’s no excuse not to do everything we can to make life a little more livable for future generations. No matter what happens, we will be glad that we tried.”

One of the most congested Bay Area highways is set to see huge changes — and a toll

In an article titled, “One of the most congested Bay Area highways is set to see huge changes — and a toll,” written by Jessica Flores. She says, “Drivers on Highway 37, the narrow and chronically congested commuter route through fragile North Bay wetlands, could see grinding rush-hour trips between I-80 in Solano County and Highway 101 in Marin County cut at least in half by a project that will widen a key stretch within just a few years.

But the plan includes adding a toll along the expanded part of the 21-mile-long highway to help cover the $430 million price tag — a detail that prompted anger and concern this week from residents who say those who will bear the brunt are those who can least afford it.

The project would expand the 7-mile, two-lane stretch of Highway 37 between Mare Island in Solano County and Sears Point in Sonoma County to four lanes, with one toll lane and one toll-free carpool lane planned in each direction.

The project is in the final design and permitting phase, with construction expected to begin in 2025, officials said. The California Department of Transportation and the Bay Area Metropolitan Transportation Commission are applying to the California Transportation Commission to operate electronic toll stations at each end of the 7-mile stretch.

At a public meeting Monday in Vallejo hosted by the CTC, agency officials said the toll will help pay not only for construction, but for improvements that will address sea level rise and congestion concerns.

Highway 37 is among the most vulnerable major roadways in the Bay Area, with Caltrans predicting portions of it could be “completely inundated” by 2050. Storms in recent years have periodically flooded the highway, forcing weeks-long closures.

But many residents at the meeting, which was also streamed over Zoom, said the toll would be an additional financial burden for people who travel from Vallejo to Marin and Sonoma counties, where there are higher-paying jobs. The median household income in Vallejo is $78,243, according to census data, compared with $108,000 in Novato at the western terminus of the highway.

According to transportation officials, of the 40,000-plus trips made daily on Highway 37, 40% are by low-income individuals and 28% are by people of color.

“This will create hardship on the people who commute” on top of high gas prices, gas taxes and other expenses, a speaker said during the meeting. “It’s the responsibility of government — federal, local, state — to provide for our roads (and) not put it on the backs of the commuters who are already paying a lot.”

Officials say the project will benefit all commuters by reducing congestion and travel times, increasing access to jobs and boosting the economy in the Mare Island area.

According to the CTC, the project would cut commute times dramatically: The eastbound evening commute would shrink from 100 minutes to 26 minutes, and westbound morning commute times from 60 to 30 minutes.

New bus transit options would be offered from Vallejo to San Rafael, and low-income households would be offered toll discounts, planners say. They add that trail connections and improvements along the highway would benefit the public.

The toll program, expected to generate $100 million to help cover the project’s cost, is being managed by the Bay Area Infrastructure Financing Authority, an arm of the MTC.

“Tolling does help finance the infrastructure investments that we’re making today,” said Andrew Fremier, executive director of MTC, during the meeting. “It will be used … to match with state and federal grants that we need to complete this particular important project.”

A specific toll rate has not been revealed yet, but Fremier said it would be consistent with toll bridges in the Bay Area, most of which cost $7 to cross.

Officials said toll collection would not begin until the new lanes and a bus service between Vallejo and Marin County are added and the low-income toll discount program is in place.

Public comments from the meeting Monday will be included in staff recommendations that the CTC will consider in May when it meets to discuss and vote on the toll application, said Paul Golaszewski, the agency’s deputy director of legislation and finance.

Drafting of the Highway 37 project got under way in 2020, and the environmental impact process has been completed, with Caltrans signing off on the impact report in February, according to John Goodwin, assistant communication director for the MTC and Bay Area Toll Authority.  After design and permitting are completed, construction is expected to start in 2025 and wrap up in in 2027, documents show.

The project will also replace the existing bridge over Tolay Creek near Sears Point with a much longer bridge that helps restore the San Pablo Baylands by increasing water flow into and out of the creek channel, according to agency documents. Work will also be done to stop deterioration of the area known as Strip Marsh East near Mare Island.

Caltrans is looking at a much larger project as the longer-term answer to traffic congestion, rising waters and bayland restoration: an elevated four-lane causeway along the existing path of Highway 37.

Such a project, which could take two decades or more and cost at least $6 billion, would also include a bicycle and pedestrian path and make provisions to eventually add SMART commuter rail services, Goodwin told The Chronicle.

“Tolling almost certainly would be part of any kind of funding package for this long-term transformation and almost certainly would include tolling the entire route from Novato to the I-80 interchange in Vallejo,” Goodwin said.

At the meeting Monday, a few people expressed support for the toll plan in the current project.

“As it becomes a bridge, it should be treated like other bridges, and we really want to make sure that we have a functioning highway before it goes underwater,” said Cynthia Murray, CEO of North Bay Leadership Council, a group that represents employers.”

https://www.sfchronicle.com/bayarea/article/highway-37-plan-widening-toll-17915311.php

America — The Build-Nothing Country?

America’s has a growing inability to build almost anything according to Noah Smith in The Build-Nothing Country (Link).  Smith says, “what’s frustrating me is America’s seeming inability to build the things it needs to build in order to prosper and flourish in the 21st century. From housing to transit to solar power to transmission lines to semiconductor fabs, the U.S. has little trouble marshalling the financial and physical capital to create what it needs, but ends up stymied by entrenched local interests who exploit a thicket of veto points to preserve the built environment of the 1970s.”

Smith says, “Stasis has become America’s spoils system, and it can’t go on.” He cites the abuses of the California Environmental Quality Act in California that is being used to thwart new housing construction as example of the desire to limit development. Smith says, “Meanwhile, across the USA, housing is just not getting built. The recent runup in prices motivated a lot of developers to pull out their checkbooks, but they barely managed to raise housing starts to their pre-2008 levels, and now things are heading back to stasis as prices cool off.”

And Smith shares that this kind of short thinking is spreading throughout the U.S. to impede all kinds of development including green energy, transit, advanced manufacturing and more.  He makes the point that “Last August the nation celebrated the passage of the Inflation Reduction Act, which allocated $400 billion to building green energy in the U.S. But as with housing and transit, allocating money doesn’t necessarily mean anything actually gets built.”

“Even in semiconductors, the ultra-high-tech industry where the U.S. and its allies must maintain leadership in order to maintain their edge over China, the U.S. can’t seem to build much. TSMC, the Taiwanese company that recently agreed to build a big plant in Arizona, is running into major cost issues.”

Smith says, “For decades, I’ve heard progressives bemoan America’s unwillingness to spend money on things like transit and green energy. But now America is spending all the money, and things still aren’t getting built, because of the country’s broken system of permitting, land use, and development.”

“This is such an important point that it bears repeating,” says Smith. “Money is not physical stuff. Just because you earmark $5 billion for a subway or $2 billion for a solar farm in some Excel spreadsheet somewhere doesn’t mean a physical train or power plant has actually been created. If permitting holds up the process for years, then you still haven’t built a damn thing. And if eventually construction does begin, but the cost balloons to absurd levels, that means that a pitifully inadequate amount of actual physical transit, or housing, or solar will be created, despite that huge flood of dollar signs in your spreadsheet.”

Driving home that point, Smith says, “For decades now, Americans have told ourselves that we’re the richest nation on Earth, and that as long as we had the political will to write big checks, we could do anything we wanted. But that was never really true, was it? The inflation that followed the pandemic should have been a wake-up call — we had all this excess cash, and we started spending it on physical goods, and mostly what happened was just that the price of the physical goods went up. And so R.I.P. to all that cash. From meaningless numbers on a spreadsheet you came, and to meaningless numbers on a spreadsheet you shall return.”

“What matters is not how big America’s spreadsheet numbers are, but how much physical stuff we get. And yet as a society we’ve decided to award people with stasis instead of stuff. In many dysfunctional societies, the government’s guarantee of economic inclusion comes in the form of a specific physical good — usually, cheap fuel. In the United States, the in-kind subsidy we provide our people is the option to keep their world from changing.”

And here’s an interesting observation by Smith: “If you’re one of the roughly 2/3 of Americans who owns a home, you can raise your wealth — at least on paper — by going to local government meetings and arguing to restrict the local housing supply. But perhaps just as importantly, you can preserve the built environment around you in exactly the form you’re used to. You can keep your streets quiet and uncrowded. You can preserve your open space, your big lawn, and your scenic views. You can keep your neighborhood free of any poor people who might live in nearby apartments or ride a train to your area. You have the option to keep your area free of anything you don’t want, for any reason.”

“This is a form of subsidy from the government to the people of America. It seems like a costless subsidy, because it doesn’t involve writing checks to people. But the costs are real, and Americans pay the costs. They pay them in the higher tax bills that citizens pay to fund infrastructure. They pay them in the increased prices businesses have to charge to make up for higher land costs. They pay them in higher rents. They pay those costs in more expensive electricity and increased carbon emissions. They pay them in the lower wages that workers earn because their cities can’t build sufficient housing near to the areas of greatest economic opportunity. They pay them in lower productivity because cities can’t grow big enough. They pay those costs in lost wages and incomes from disinvestment, when companies decide that America’s obstacles to land development make it a bad country to build a factory in. And eventually they pay the cost of a weak country that doesn’t have the economic strength to stand up to rivals like China.”

Smith says, “Physical stasis seems cheap, but it’s an incredibly expensive way to subsidize the lifestyles of Americans. And it seems that whenever our real incomes flatlined, as they did in the 70s and again in 1999-2015, we increased this stasis subsidy to compensate, making it even harder to build anything — a booby prize for an electorate mired in stagnation, which ended up exacerbating that very stagnation. The 70s were when the embrace of stasis began, but the 2010s are when it reached its apotheosis.”

“This ill-advised path has now come to its inevitable end,” cautions Smith. “We no longer have the luxury of giving our people a shadow subsidy by freezing their neighborhoods and cities in amber. Spiraling housing costs in any city with real economic opportunity, a floundering energy transition, and the inexorable migration of manufacturing to more development-friendly countries have become so severe that we must dispense with our collective illusion that America will always look like it looked in 1975. Slashing the thicket of red tape that prevent development, and subordinating local interests to the needs of the nation itself, are no longer idle dreams — they are immediate necessities. If we insist on continuing to be the Build-Nothing Country, our once-mighty middle class will sink into a genteel poverty, and someone else will build the future on the bones of our civilization.”

We hope that we will come together to support the new housing, green energy, infrastructure and advanced manufacturing our country needs and maximize the investment of our tax dollars in these projects to produce tangible results beyond a wider spread sheet.

Workforce shortage, Skills Mismatch, New Jobs Creation and Layoffs: What Does this Mean?!

There is record unemployment and millions of new jobs being created. And yet, thousands of people are being laid off. But there are over 10 million job openings in the U.S. Hiring new employees is difficult in the North Bay (and beyond).  Talk about mixed signals!  What is going on in the workforce?

In You might be jobless in 5 years, (Link), we learn one aspect of understanding what is happening.  There has been acceleration of companies changing their business practices and creating jobs requiring different skill sets than they previously sought.  In Career Insights, Shatakshi Sharma, Co-CEO Global Governance Initiative, answers these questions based on the research done by BCG, LinkedIn and World Economic Forum: “Are you wondering if you should switch your job? Or do you question if you even have the right kind of skills for your job profile?”

  • The relative importance of skills

The research talks about different skill groups. It showcases whether their importance is increasing, decreasing or remaining stable. Skills such as critical thinking, problem-solving, self-management, working with people and tech and development see a growth in their importance. Whereas, on the other end of the spectrum, skills such as management and communication activities, core literacies and physical abilities are experiencing a relative decline in importance.

  • Top 15 skills for 2025

The highest-ranked skills are analytical thinking and innovation, active learning and learning strategies, complex problem-solving, critical thinking and analysis. These skills test whether you are actively trying to learn and upskill yourself or are you happy to do an MBA and cease your growth henceforth. It also talks about your ability to ring structure in a messy situation and get a clear solution.

The next set of important skills are creativity, originality and initiative, leadership and social influence. It involves your ability to think out of the box and influence without having authority. Skills such as technology use, monitoring and control, technology design and programming help you talk to product management or coders. It also involves using IOT, Cloud Computing and Artificial Intelligence to solve problems.

Certain character-based skills such as resilience, stress tolerance and flexibility and emotional intelligence also make the list. It emphasizes how EQ in addition to IQ is important.

Troubleshooting and user experience, service orientation, system analysis and evaluation are important to solve problems and improve customer service.

Last, but not least, we have persuasion and negotiation. This particular skill will not only help you excel in your career but also get you a good salary.

Besides sharpening skills to match employers’ needs, there are other aspects to consider.  In Three shifts to expect in the hiring market in 2023, by Ty West (Link), he says, “One thing unlikely to change? The need for speed in the hiring process. Corey Berkey, senior vice president of people and talent at recruiting technology company Employ Inc., said signs continue to point to the labor market remaining tight this year, but with some improvements compared to 2022. Even with those improvements, experts say companies won’t be able to revert to their pre-Covid hiring practices without increasing the risk of missing out on talent.”

“I think that companies are going to evolve because they’ve learned a lesson, or they’re going to get run over,” Berkey said.

West says, “A recent survey by Employ found 77% of organizations have not reduced hiring plans or implemented a hiring freeze, and 8% anticipate making fewer hires in the next 12 months, with the bulk of companies planning to pull back concentrated in the technology, manufacturing and financial sectors — a trend that dovetails with recent layoffs. But the survey did find a 10.4% decrease in job openings between the second and third quarters of 2022, and an 8.7% increase in the number of job applicants.”

Even with those shifts, Berkey anticipates the intense competition for talent will remain in a number of sectors, making it pivotal for recruiters to follow best practices. Here are some of the trends Berkey anticipates and how employers can respond:

“1. Employers will rethink hiring strategies

Since the Covid-19 recovery ramped up in early 2021, companies across a range of industries beefed up their payrolls. The result was a tight talent market, soaring salaries, elevated turnover and labor shortages in many sectors.

But as the economy has slowed, many companies are trimming positions and, in some cases, admitting they hired too many employees or increased salaries too much. Both 2022 and 2023 have been banner years for budgeted average raise amounts. While metrics show many companies plan robust hiring in 2023, Berkey said those efforts are likely to be more targeted.

‘It’s no longer going to be, ‘Hey, this role has been vacated. Let’s get that backfilled,’ Berkey said. ‘I think we’re going to see businesses prioritize around roles that they know are going to drive that strategic value of the organization forward.’ He said that trend will contribute to an increased focus on candidate quality for many businesses.

2. Hurdles at the offer stage

Employ’s data found about 40% of offers are being accepted, echoing some of the obstacles recruiters have discussed with The Playbook. Pay expectations are a common sticking point, with the increasing number of counteroffers playing a role. Due in part to the high cost of replacing talent, recruiters say they are seeing a relatively high rate of counteroffers. I think a lot of Hail Mary, last-minute saves by the current employer are what’s driving this number up,’ Berkey said.

The push for pay transparency is another factor — often affecting companies that aren’t having the salary conversation early enough. In the absence of those discussions, candidates are doing their own research and making assumptions.

‘I think a lot of candidates are getting to the finish line in the recruiting process and because the company hasn’t openly had that conversation around compensation, the candidates are almost getting surprised by it,’ Berkey said. ‘They’re often driven by what they see online, which online, you can find some crazy, crazy benchmarks that are completely inaccurate.’

He said candidates often hear stories about people who are changing jobs and getting a 40% raise. ‘That’s real. It’s really happening, but it’s not happening 100% of the time,’ Berkey said. ‘If you’re holding out for that 40% increase, that’s going to be few and far between.’

3. A shift in pay strategy is coming, but not for everyone

Berkey anticipates that top-flight candidates will remain in a strong negotiating position in 2023 — in part due to the increased focused on candidate quality. Berkey said ‘stretch candidates,’ whom he described as candidates who don’t necessarily have the experience but have the attitude and aptitude that make them compelling applicants, will have a tougher time than they have in the past two years and will be met with more reasonable salary offers.

Overall, Berkey expects the pendulum to swing toward pre-Covid compensation levels but not quite a full return. ‘I still think wages are going to climb more than we’ve seen in the past,’ he said. That’s particularly true for highly skilled candidates. Berkey expects they will still receive aggressive compensation packages.

There are growing signs of a disconnect on pay, with the inaugural Monster Work Watch Monitor finding 42% of employers saying salary expectations have reached unreasonable levels. That’s up from 30% a year ago. That’s not a surprise to recruiters, who have previously told The Playbook that many companies were backing themselves into a corner with salary offers and raises they were approving in 2022.”

Gen Z is the Future — and the Present

Building on the advice of Frances Hesselbein, we want to learn more about the emerging leaders in the next generations, Millennials and Gen Z. If we want to prepare for the future, we need to look at demographics.  There is a big shift happening now that merits our attention.  The following are excerpts from 8 Generation Z Trends & Predictions for 2022/2023A Look Into What’s Next by James Anthony, (Link).

Gen Z is Different than Any Other Previous Generation

Gender-fluid Concepts

Over the past years, we’ve seen how more and more businesses are opening up to gender-neutral pay id online pokies products, and for a good reason: Gen Z reports being a generation more accepting of non-binary products. Gen Z’s power extends in allowing a new wave of acceptance that’s not restricted to any gender at all. With this, various brands like Sephora and Telfar took the major steps to a more accommodating and gender-neutral industry.

As shown in several studies, binary-gendered options are a thing of the past. Back in 2015, Facebook, apart from the male and female options, started adding a third one: the custom option, where users can select from 58 different identities, such as androgyne, trans-male, trans-person, and more, prompting other brands and companies from various industries to do the same. Milk Makeup, a cosmetics brand, followed in 2016 by launching a makeup campaign that includes everyone, starting from trans models to cis straight men wearing makeup.

This shift to gender-neutral products opened new doors for businesses to expand their brands. This also allowed them to relate more to Gen Zers and retain them as loyal customers. The strategy improves customer experience for Gen Zers. Instead of products “made for men” or “made for women,” brands are using product categories instead and getting rid of stereotypical gender roles. Such a trend is expected to continue in the coming years as businesses prepare to cater to the demands of the new generation.

Concerns on Mental Health

Today’s current headlining issues, from immigration, sexual assaults, mass shootings, to environmental decline, are affecting the whole world, and it can be too much for anyone. With these issues plus, other internal and sociological factors, Gen Z becomes the generation feeling the impact more as compared to their predecessors. After that, they are the ones most likely to report mental health concerns. And Gen Z, being a big part of today’s workforce, considers mental health as a factor that affects their work environment.

Prior to the pandemic, a study found that many Gen Z workers usually suffer from anxiety and stress. Its follow-up study found that the stress levels of Gen Zers appeared to have declined, likely because of the general shift to remote work and the slower pace of life in general. Nonetheless, the study found that 48% of Gen Zs feel anxious or stressed all or most of the time (Deloitte, 2020).

In an earlier study, nearly 9 in 10 Gen Z adults report having at least one or more emotional or physical symptoms because of various stressors in their lives, according to a study by the American Psychological Association. About 58% report being depressed or sad, and 55% experience a lack of interest, motivation, or energy. This leads to companies encouraging workplace wellness programs in an attempt to take care of the mental health of their employees. As a result, employers can minimize the health care costs allotted to their businesses and workers.

Diversity as an Asset

Political shifts, changes in education, and other social changes drove Gen Zers to become the most ethnically and racially diverse generation in the history of the United States. A study by the Pew Research Center reveals that 52% of Gen Zers are non-Hispanic white (Pew Research Center, 2019). In the next 10 years, Gen Zers will grow more in population and can make the majority of the population racially diverse.

With Gen Z considering diversity as a positive asset, businesses are prompted to develop a more inclusive and diverse brand, extending even further beyond advertising and products. Emarketer’s study results show that about 6 in 10 Gen Zers say they prefer seeing ads that have diverse families in them. They are also more likely to support brands that are proactive in tackling racial issues.

This only goes to show that Gen Zers are pickier when it comes to choosing companies to work for and brands to support. As a racially diverse generation, they need assurance from brands that discrimination won’t be tolerated. When doing business with Gen Zers, it’s crucial to take into consideration not only the market’s similarities but also their differences, leading to a more expansive product line.

Sustainability as a Factor

Sustainability is another thing to consider when dealing with Gen Zers. Along with Millenials, Gen Zers are pushing for a more sustainable and eco-friendly market in various industries. For younger generations, a product’s ecological footprint is very important. They seek high-quality and long-lasting products as opposed to disposable items. At the same time, sustainable materials find their way into this environmentally conscious generation.

One example is the clothing line Tentree. It successfully gained a massive social media following worldwide right after launching products that use only sustainable materials. The brand also associated with supply chain partners who are socially responsible. This led to an influx of traffic on their website due to an increase in international web visitors.

Gen Z respects brands that are highly conscious of the marks they leave on the environment. In a study by FirstInsight, about 73% of Gen Zers are willing to pay more for environmentally-friendly products (First Insight, 2020). Meanwhile, the same preference was shared by 68% of Millennials, 55% of Generation X, and 42% of Baby Boomers.

Allison Carter in Top Gen Z trends in 2023, (Link) shares some more insights into this generation’s aspirations and needs.  Some of the trends she identifies are:

An activist generation

Gen Z cares deeply about a wide range of issues — and wants the organizations and influencers they interact with to do the same. Thirty percent of Gen Z is of voting age, the study says, and they want to see change.

Topics they’re particularly passionate about include disability rights and climate change.

Concern over climate change seeps into aspects of Gen Z life you may not expect. For instance, half of survey respondents plan to DIY clothes in the new year — a response to the fast fashion movement that leave landfills stuffed with clothes intended to be worn only a short time. They also incorporate sun protection into their (often elaborate) skincare routines to ward off hotter temperatures and damaging rays.

Global interests

American Gen Zers are the most ethnically diverse generation in history, according to Pew Research, with 48% identifying as a race other than white alone. It stands to follow that this generation has a deep interest in the world outside their own borders.

The Instagram survey found that more than half of respondents plan to listen to non-English music in 2023, with a particular emphasis on K-pop and Latino music. Another 68% either has or wants to try food from another culture after discovering it on social media.

Communicators must look beyond a dominant, mostly white culture to embrace this diverse group of Americans.

A craving for community

Unsurprisingly for a generation which spent many of its formative years in the midst of a pandemic that demanded we stay apart, Gen Z is particularly interested in coming together for in-person experiences. The survey found that one-third of respondents were interested in in-person meet-and-greets with influencers, while 68% of respondents plan or want to attend a rave in 2023 (yes, apparently raves are back).

And not to be outdone, Josh Howarth in 7 Key Gen Z Trends for 2023, (Link), has more trends to observe for this generation that will change much of American life.  Howarth list includes these trends:

Digital Natives

Gen Z doesn’t know a time when the internet didn’t exist. They are “digital natives” in the truest sense of the term.  The stats prove this. More than 95% of Gen Zers own a smartphone, 83% own a laptop, and 78% own an internet-connected gaming console. In fact, they’ve been exposed to tech from a young age, especially when compared to previous generations.

Older Millennials got their first cell phone at an average age of 20. Younger Millennials started at 16. Gen Zers had their own phones by the time they were 12. Trends show that this generation is becoming more and more centered on tech.

One survey found that more than half of Gen Zers feel more insecure without their smartphone versus without their wallet.

Social media is a huge trend for this generation. Instagram, Snapchat, and TikTok are, by far, the most frequently used platforms. One-quarter of Gen Zers spend five hours or more per day on TikTok.

The average Gen Z individual spends 3.4 hours per day streaming videos. Searches for “YouTube TV” have remained on a fairly steady increase over the past 5 years (221%). It also reported that 44% of Gen Zers stream more than 3 hours of Netflix per day. Only 20% of Gen Zers don’t have their own Netflix subscription.

Distrust Of Government and Other Organizations

A Pew Research report showed that 70% of Gen Zers believe the government should do more to solve problems. This trend was only amplified by the pandemic. A February 2021 study said 66% of Gen Zers disagree that the government has done its best to protect the country.  The same study reported that nearly 60% of this generation agreed that it’d be difficult to trust the government post-pandemic. One research paper suggests this distrust could continue well into the future.

The Political Scar of Epidemics, published in mid-2020, suggested that individuals who experience an epidemic when they are between the ages of 18 and 25 are likely to have negative attitudes toward the government and elections for a long time after the epidemic is over. This means individuals in the older segment of Gen Z are less likely to trust elections, less likely to have confidence in the government, and less likely to approve of political leaders.

This trend could have a large impact on the 2024 election.  In 2020, Millennials and Gen Zers made up 37% of the voting eligible population. In 2024, that number will jump to 44% with all the growth coming from members of Gen Z.

The distrust of Gen Zers goes beyond politics.  They are unlikely to trust brands, too. Only 39% of Gen Z internet users trust a brand to keep their data safe. Consumers in Gen Z trust brands with their data much less than any other generation.

A Deloitte survey found that 24% of Gen Zers don’t trust business leaders, 30% don’t trust traditional media, and 49% don’t trust religious leaders.  This trend may continue as Gen Zers grow into adults, but some experts suggest distrust is just part of being a teenager.

Peter Adams, who leads an organization teaching kids about media literacy, recently said, “Trust in institutions is down across the board, but teens experience even more cynicism about institutions just as a function of their time of life.”

Influencing The Workplace

The oldest members of Gen Z are just now entering the full-time workforce for the first time, but by 2025, they’ll make up 27% of the global workforce. Right now, they’re starting to lead the charge for several big changes.

The first is work-life balance. Research shows that nearly 40% of Gen Zers put a large emphasis on work-life balance when choosing where to work.

Gen Zers are also likely to focus on empowering work culture and potential for growth with the company. Work culture and growth potential are the top two reasons Gen Z employees will stay with a company, according to Finances Online.

Gen Z is also demanding more workplace benefits. They want flexible hours, fully covered health insurance, free meals, and sizeable salary increases – just to name a few.

They want their employer to encourage a healthy lifestyle. Gym memberships, flexible spending accounts related to healthy activities, and sabbaticals are all trending as benefits now. Employee wellbeing has become a topic of focus in many organizations. Search volume is up nearly 289% over 5 years.

Generation Z is one subset of employees that does not put a large emphasis on working remotely. In one survey, 48% of respondents said they’d prefer a hybrid work environment. Only 30% wanted to work fully remotely. Searches for “hybrid work” surged in the latter half of 2020 and is up 364% over 5 years.

In one survey, nearly half of Gen Zers said they’d like to own their own business.

Stats from Wonolo, an on-demand staffing platform, show the gig economy is growing among Generation Z. Their share of jobs on the platform grew by 14% between 2019 and 2021.  Lending Tree reports that 46% of Gen Zers over the age of 18 have a side hustle. Nearly one-quarter of these individuals would not be able to pay their bills if they didn’t have that side hustle. A few of the most popular spots in the gig economy for Gen Z workers are selling custom clothing, selling artistic goods on Etsy, and freelancing on Fiverr.

As the future of work changes, we can expect that Gen Z will be leading even more change. In The state of young leadership by Layla Zaidane, The Fulcrum (Link), Zaidane says, “It’s no surprise that Gen Z and millennials operate differently from older generations on everything from when they get married to how they approach money. But one thing the most diverse generations yet are doing differently is surprisingly under-reported: They’re bringing a new and more effective style of leadership to legislatures across the country.

Not only have we seen them prioritize future-focused solutions on issues like climate change, criminal justice reform, cost and access to higher education, and more — but they’ve done so in a more collaborative and bipartisan fashion than their older peers. At my organization, Millennial Action Project, we’ve been tracking these young agents of change and recently released a report called “The State of Young State Leadership.” Here’s what we found:

Young people only make up 20.7 percent of state legislatures. That’s right – despite being the largest generation, millennials and Gen Z only make up one-fifth of our nation’s state legislative chambers. While the average age of the country is 38, the average age of a state legislator is 56. I’ll let you guess what the average age of Congress is. And unfortunately, indications point to state legislatures and Congress only getting older.

While there is value in having older, seasoned lawmakers in office, it does more harm than good when it’s at the expense of uplifting young or diverse leaders who can bring new perspectives to the policymaking process. And after tracking 1,535 legislators under the age of 45, we can safely say that this group’s success as bridge builders is incredibly high.

Young legislators are responsible for authoring 32.9 percent of all bipartisan legislation that actually gets passed – busting any claim that young people in legislatures are more partisan or uncooperative than older generations. In my work at MAP, we have found that, while opinionated and outspoken, young legislators are able to strike a balance between bringing their full selves and opinions to the table and successfully collaborating across the aisle. While young people did not create the problems we’re facing, it appears that we’re idealistic enough to believe we can solve them and pragmatic enough to know that building coalitions is a necessary step to creating change.

Importantly, 266 of the 1,535 young state legislators are in at least one senior leadership position, including speaker, Senate president, president pro tempore, majority/minority leader, majority/minority whip/assistant leader, or caucus or conference Leader. In addition, 401 young legislators are in a committee chair position, and 444 are in a vice chair position. Young people hold positions of power within state capitols, and they’re using it to great effect.

It makes sense that individuals who can persuade, listen and “strike a deal” often rise into these leadership positions. The data show that by this measure of assessment, young people certainly make the cut. Their bipartisan track record and presence in leadership positions prove that not only are young officials up for the challenge of holding public office — they are excelling at it.

Congratulations to the NBLC Endorsed Candidates on Their Wins!

North Bay Leadership Council congratulates the following newly elected officials. We appreciate the well-run campaigns which led to their election.  Their broad base of support bodes well for their ability  to serve their communities and produce positive results. The winners are:

 

Novato City Council

Rachel Farac – District 3

 

Petaluma City Council

Kevin McDonnell – Mayor

Karen Nau – District 3

 

Rohnert Park City Council

Susan Hollingsworth Adams – District 5

Samantha Rodriguez – District 1

 

San Rafael City Council

Maribeth Bushey – District 3

Eli Hill – District 2

 

Santa Rosa City Council

Mark Stapp – District 2

Dianna MacDonald – District 3

Jeff Okrepkie – District 6

 

Napa County Board of Supervisors

Anne Cottrell – District 3

 

Sonoma County Superintendent of Schools

Amie Carter

 

NBLC looks forward to working with these newly elected officials on public policy issues of mutual concern. We thank them for their dedication of service to the North Bay.

NBLC 2022 Endorsements

North Bay Leadership Council is pleased to endorse the following candidates for their respective offices as follows.  We are supporting these candidates because they are balanced in their approach to the issues, not beholding to any special interest group, and committed to economic vitality and more housing.

NBLC is proud to endorse:

Novato- By District

Rachel Farac #3

Petaluma- By District

Karen Nau #3

Dylan Lloyd  #1

David Adams  #2

Kevin McDonnell  — Mayor

Rohnert Park- By District

Susan Hollingsworth Adams #5

Samantha Rodriguez  #1

San Rafael – By District

Maribeth Bushey #3

Eli Hill  #2

Santa Rosa- By District

Mark Stapp #2

Dianna MacDonald #3

Terry Sanders #4

Jeff Okrepkie #6

Napa County Supervisors:

Suzanne Truchard – Supervisor – District 1

Anne Cottrell – Supervisor – District 3

Community College Governing Boards: Sonoma County Junior College

District Trustee Areas 1 (East):  Ezrah Chaaban

District 2 (South County): Maggie Fishman (Inc.)

District 5 (Central Santa Rosa): Dorothy Battenfeld (Inc.)

District 7 (West County): Michael Valdovinos (Inc.)

 

NBLC members also support the following Ballot Measures:

SUPPORT: Proposition 1: Would make California’s existing rights to abortion part of the state’s constitution.
SUPPORT:  Prop 31: Gavin Newsom signed a bill banning the sale of all flavored tobacco products, whether smoked, chewed or vaped. The tobacco industry gathered enough signatures to ask voters to overturn the law with this referendum. (A reminder: Voting “yes” is to keep the law; voting “no” is to get rid of it.)

Please make sure that you are registered to vote. If you are voting by mail, remember to mail your ballot very early so the slowdowns in mail delivery do not delay your ballot being received by the Registrar of Voters in a timely manner.  Your vote counts!

The New “Housing Rich” Millionaires

In the Public Policy Institute of California’s report, California’s High Housing Costs Have Created a Million “House Rich” Millionaires by Hans Johnson (Link) we learn that while California’s high housing costs are out of reach to many potential homebuyers, there are also many who are benefitting from the increase in housing costs.  Johnson says, “rapidly rising home prices have led to unprecedented levels of wealth among homeowners, including a growing number who have record amounts of home equity. In 2020, more than 700,000 California households had at least one million dollars in equity in their homes, according to American Community Survey data. With rapid price appreciation between 2020 and 2022, we estimate that approximately 1.2 million California households are now home-equity millionaires.”

Johnson goes on to detail who “these house-rich Californians” are:

  • Most have paid off their mortgages. In 2020, 58% of the state’s equity millionaires owned their homes free and clear. Statewide, there has been a dramatic rise in the number of Californians who have paid off their mortgages, from 1.6 million households in 2000 to 2.4 million in 2020. The share of all owner-occupied homes that have no mortgage increased from 25% to 33% over that same time frame.
  • Most have lived in their homes for a long time. About half have lived in their current home for more than 20 years. Those with no mortgage have stayed put the longest, with about one-third living in their homes for 30 or more years, compared to 11% of those with a mortgage, and 2% of renters. These long tenures are a testament to the important role that long-term homeownership plays in building household wealth.
  • Because so many of them bought their homes decades ago, high-equity homeowners partly reflect the demographics of the state’s past rather than the California of today. The most common age group for high-equity owners is 65–69, compared to 55–59 for other homeowners, and 30–34 for renters.
  • Equity millionaires are more likely to be white or Asian compared to other homeowners or renters. White and Asian homeowners make up the vast majority of high-equity homeowners (87%). In contrast, only 13% of high-equity homeowners are Latino, Black, or Native American. These differences reflect and exacerbate other kinds of inequality in California, including income inequalityand educational inequality.
  • On average, high-equity homeowners with no mortgage are more educated and have higher incomes than renters, but they tend to be less educated and have lower incomes than those with a mortgage. This partly reflects the older ages of high-equity homeowners with no mortgage, many of whom are retired and became homeowners many decades ago when college enrollment and completion were less common.
  • High-equity homeowners who own their home outright pay less in property taxes than those with a mortgage, largely because of Proposition 13, which limits increases in property valuations for the purpose of taxation. High-equity owners without a mortgage have an annual median payment of $7,100, compared to over $10,000 for those with a mortgage.
  • The vast majority of California’s high-equity homeowners live in coastal metropolitan counties. Even though homeowners with no mortgage are more likely to live in inland metropolitan and rural areas, where homeownership rates are higher and housing prices are lower, those with the highest equity tend to live in expensive coastal metropolitan areas, especially the Bay Area and coastal Southern California.

“Homeownership has been key to wealth creation for generations of Californians,” says Johnson. He explains, “Residents who came of age in the 1950s and 1960s did so in an era of rapid expansion of homeownership. After World War II, new transportation infrastructure coincided with the massive construction of new suburbs with abundant housing, loans became more accessible for many, and housing prices in California were only somewhat higher than in the rest of the nation. Over time, many of those homeowners became California’s equity millionaires.”

But Johnson cautions, “… redlining and discriminatory lending practices during that period kept many people of color from homeownership.  Today, high housing costs limit young adults’ access to this means of wealth creation. In 1960, over half (54%) of 30-to-34-year-olds in California owned a house, compared to about a third today. Finding ways to improve homeownership among young adults is central to housing stability and future housing equity.”

Some solutions to the housing crisis are clear—we must build more housing, especially workforce housing.  Others are being explored by the Legislature and housing advocates like help for first time homebuyers.  The building industry is exploring new construction methods and materials in hopes of bringing down the cost of building.  All possibilities should be considered and those that are worthy should be implemented if we are to make our state’s economy and workforce vibrant and resilient and keep more people from falling into poverty.