For years now, we’ve been aware of the lack of educators entering academia, but what happens when the staff shortage hits your office? Prognosticators worry about the growing shortage of workers in many fields. Pepperdine University business school’s Donald Atwater noted that “a systematic labor shortage is expected to transform the workplace over the next 25 to 30 years as the gap between baby boomers and entrants of college-educated workers widens due to the boomers’ mass retirements. … This trend would create an overall U. S. labor shortage of 35 million workers. … The consequences of such a skilled worker shortage at the national level would be substantial.”1
A painful preview is the current shortage of registered nurses. Enrollment in nursing programs has declined by 50,000, or 22%. Today, the shortage of nurses is estimated to be 200,000, and this is expected to grow to 800,000 to 1,000,000 by 2020.
Preparing for a future labor shortage.
Gregory P. Smith, an international business consultant, has written extensively on the crippling effects of a workforce shortage. He noted that “The aging workforce is an issue businesses need to address. The simple truth is this country is not having enough babies. The growth rate of the workforce has been steadily declining since the 1970s.” According to Smith, reports from the U.S. Census Bureau and others indicate that “the workforce will begin to experience a negative growth rate beginning in the year 2015. Consider the 45- to 65-year-old worker, who census figures show is the fastest growing demographic. Estimates indicate that by year 2020 one out of every two people in the U. S. will be older than 50. These older workers are willing to stay in the workforce longer or even reenter it after retirement. Yet most businesses continue to cater to rapidly diminishing younger workers.”2
It has long been known that turnover costs are high. The cost of attracting, recruiting, hiring, training, and getting new people up to speed is tremendously more costly than many realize. The prevention of staff turnover is always less expensive and a wiser use of your resources. Labor costs of running an orthodontic practice can be high, and most managers rarely consider how much turnover is actually costing them. Studies show that it costs $7000 to $9000 to replace an hourly wage employee and up to $45,000 to replace a midlevel salaried employee.
Workforce shortage crippling many industries.
So, what’s the answer?
For starters, as the labor pool shrinks, practitioners and office managers alike must focus on creating an environment that lets people work productively and effectively, and makes them feel good enough to stay. Improve your hiring process to create a better match between a person’s talents and the job requirements. Improve some benefits to make your office more attractive to an older workforce. When I left clinical practice a few years ago, my long-time office manager kept on working for the new partner. Today, she is in her 70s and still going strong.
Be prepared to pay more to attract and retain employees; increased compensation is a fact of life in the world with a labor shortage. Also, distinguish your office by an improved image, better working conditions, desirable benefits, increased diversity, employee safety, and greater flexibility. The American Association of Orthodontists offers programs to help make this long-term problem less painful. As a member, you can purchase 1 year of unlimited access to the online portion of the AAO Distance Learning Program (over 100 lectures) for only $100. The price for staff members is only $25, and the fee is waived if they join the AAO Orthodontic Staff Club first. There are additional benefits of joining the AAO Staff Club, such as reduced meeting registration fees and products.
In study after study, it’s not the money that keeps employees on the job. It’s feeling appreciated and knowing that their contributions make a difference. People want to be challenged, they want to learn, and they want to grow. When you allow your staff to stretch their personal envelopes, they feel good about themselves and the job they’re doing in your practice. That’s how you will overcome the pending workforce shortage.
Preparing for a future labor shortage.Graziadio Business Report. 2004; 7: 1-5
Workforce shortage crippling many industries. ()
© 2008 American Association of Orthodontists. Published by Elsevier Inc. All rights reserved.