The US must add at least 4.6 million workers annually through 2033 to maintain a sufficient labor force. But with slowing workforce growth and an aging population, the country is facing intensifying labor shortages with long-term implications.
To close the seismic gap between job openings and available workers, a new report from the Committee for Economic Development (CED), the public policy center of The Conference Board, outlines a comprehensive strategy for expanding labor force participation, strategically increasing immigration, and aligning worker skills with evolving economic demands.
„Critical steps—from supporting labor force participation to reforming immigration—must be taken to increase US labor supply, prepare workers for the future economy, and attract global talent,“ said David K. Young, President of CED. „These challenges demand bold, forward-looking policy—and strong collaboration between the public and private sectors—to ensure the US workforce is ready for what’s ahead.“
Maximize Labor Force Participation
- Repealing the Social Security retirement earnings test would reduce confusion among workers nearing full retirement age and boost labor force participation.
- Expanding the Earned Income Tax Credit (EITC) would promote work and reduce hardship among low-income workers. Congress should increase the maximum EITC and income limit for individuals without children and remove age eligibility restrictions that penalize those over 65 or under 25.
- Flexible work arrangements support workforce participation for many groups, including older workers, parents with young children, caregivers, and those with disabilities.
- Increase support for working parents, including by increasing financial support for paid childcare through expanding funding for the Child Care and Development Fund, and potentially reforming the Child and Dependent Care Tax Credit, and making more forms of childcare eligible.
- Policymakers should take steps to increase the childcare workforce. Employers may also consider providing on-site childcare facilities.
- Congress should also address tax penalties for secondary earners, typically women, which disincentivize labor force participation.
