Fixing The Labor Gap: US Needs Efficient Immigration To Prevent Permanent Shortage
By John E. Dorer, CEO of eb3.work
The United States is in the middle of a labor crisis. The demographic confluence of an aging workforce and a birth rate long in decline means there are simply not enough workers to replace the 10,000 workers retiring every day. While the economy has rebounded from the pandemic in many ways, employers all over the country are still struggling to find workers to fill job vacancies. Jobs remain unfilled for months across a wide swathe of key industries, from food service and hospitality to trucking and healthcare. These extended vacancies slow growth and place enormous strain on the existing workforce. If not addressed this risks further entrenching the problems, as understaffed companies must ask more of existing employees, creating higher stress and leading to higher rates of burnout and turnover. To alleviate these combined stressors on the labor market, the only solution is more workers. While these long-running demographic trends cannot be changed overnight, action to improve the legal immigration system would go great lengths to increasing the labor pool.
The Scope of the U.S. Labor Shortage
When it comes to the scale of the shortage the numbers are stark. According to the U.S. Chamber of Commerce, there were more than 9.5 million job openings across the U.S. in early 2024—but only about 6.5 million unemployed workers actively seeking jobs. That’s a gap of over 3 million positions, and in many sectors, it’s even more pronounced. Hotels and fast food chains cannot find enough workers to fill cleaning, food prep, and customer service roles. The American Trucking Association reported a shortage of more than 80,000 truck drivers in 2023. In healthcare long-term care facilities and hospitals lack enough workers to fill vital roles including aides, orderlies, and support staff. The manufacturing and construction industries will need thousands of skilled and semi-skilled labor to meet demand. All of these industries have long relied on immigrant workers to meet their needs, and any efforts to increase the labor supply by improving the immigration system can go great lengths to filling these needs.
The importance of filling these jobs cannot be overstated, as the cascading effects will reverberate far beyond the bottom lines of businesses in these industries. At the same time thousands of workers are retiring every day, long-term care homes are already short-staffed. While America suffers from a housing deficit, there are not enough workers to build those homes. Trucking and warehousing labor shortages impact nearly all industries. Continued labor shortages across these vital industries will echo throughout the entirety of America’s economy if not addressed.
Why Turnover Makes the Problem Worse
Furthermore high turnover rates in these industries, which will only grow if the labor gap is not addressed, means that even when employers do manage to hire, they often face a cycle of recruiting, onboarding, and losing staff again within weeks or months. The costs of such high turnover eat into profits, reducing businesses’ ability to invest in longer term solutions to the problem. Raising wages or offering bonuses have helped in some cases, but they’re not enough to meet long-term demand, and again the high turnover cost reduces the ability to offer such enticements. The systemic nature of the issue, impacting businesses big and small across a wide range of industries, requires a systemic solution. The need to reform and streamline employment-based immigration programs to match today’s labor market reality has never been greater. Business and government leaders must work together to make that a reality today, or risk a permanently entrenched labor shortage.
For employers seeking workers for entry-level and hourly roles, the problem isn’t just hiring workers but keeping them. Some industries report turnover rates of 100% or more annually meaning the average worker stays less than 12 months, often much less. The National Restaurant Association noted in a report that fast food and quick-service restaurants in particular bear the brunt of such costs, with persistently high turnover driving up the costs of recruitment, training, and the lost productivity resultant from those low retention rates. High turnover is especially damaging in roles that require safety training, customer service consistency, or team cohesion. Employers must spend thousands of dollars each year just to keep positions filled, hurting efficiency, morale, and long-term planning.
Businesses have sought to mitigate the impact of turnover by increasing wages, offering signing bonuses, and improving benefits. These efforts have largely failed to close the gap, and the longer they must deal with such high turnover the fewer resources they have available to offer such enticements. Again, the only solution is to make sure we are letting more workers into the labor pool.
Demography, Immigration, and Employment-Based Visas
These long-running trends continue to be exacerbated by an aging population with millions of baby boomers retiring every year, and not enough younger workers entering the labor force to replace them with the national fertility rate hitting a record low in 2023. Immigration has long been a way to overcome this, as the fertility rate has been dropping for decades, and has also faced its own difficulties over the past decade. The US saw a significant drop in legal immigration between 2017 and 2021, with extended backlogs, administrative slowdowns, and changing policies contributing to a shortfall in new workers entering the country. Just as immigration levels were beginning to recover from the pandemic’s impact, the US risks re-entering an immigration slowdown.
Rather than a slowdown, and in lieu of a complete overhaul, business and government leaders must work together to improve the visa programs that already exist. These programs are vetted and tightly regulated, and can help employers fill positions they have been unable to staff locally. These particularly benefit some of the areas hardest hit by labor shortages, in rural or economically strained areas. These visas also pair employers and employees for specific jobs, and tend to be more reliable and longer-tenured, helping reduce turnover costs. These programs exist for employees in a wide variety of industries, from seasonal agricultural labor (H-2A) and temporary non-agricultural work such as hospitality and construction (H-2B), and longer-term solutions for skilled, unskilled, and professional workers (EB-3).
Unfortunately, while these visas could all be used to great effect to narrow the labor shortage, they are plagued by inefficiencies. While the EB-3 visa in particular can be greatly beneficial in terms of long-term planning, they can take 2-3 years or more to process due to government backlogs. The complex application process for employment-based visas requires employers to navigate multiple government agencies, including the Department of Labor, U.S. Citizenship and Immigration Services under the Department of Homeland Security, and often the Department of State. Even before the disruption caused to these and other agencies by recent government layoffs, this was overwhelming and seemingly unnavigable to many prospective employers. Especially for smaller businesses, and for those in the areas in most dire need of workers, they simply do not have legal or administrative resources to pursue these options.
Even for businesses with the resources and wherewithal to navigate the long processing times and complicated processes associated with these visas, they still may be stymied by outdated caps. The confluence of rising tariffs and deportations could mean there are not enough workers to meet demand, with caps such as the 66,000 per year limit on the H-2B program woefully insufficient. Such caps and quotas also exist for individual countries, disproportionately harming more populous countries that could otherwise provide the very workers the US so desperately needs.
Improving Immigration Systems
Even without overhauling the quote system, and beyond raising awareness among potential employers of how the resources available to them, there are other simple steps that can be taken. First, modernizing the application system can go great lengths to speed up the process. Many run on paper-based workflows rather than electronic, or on outdated databases and timelines inconsistent from one agency to another. Digitization and increased interagency data sharing, which could be a boon to reduce many government inefficiencies, could go great lengths to speeding the process. Second, such digitization and streamlining could increase transparency and predictability. Even for companies capable of navigating the system as it is, the unreliable timelines can be a deterrent. Third, visa caps should be adjusted so they fluctuate according to real labor data. The aforementioned H-2B cap, for example, should reflect job vacancies and current need, not caps set decades ago. Fourth, offer guidance and support tailored specifically to expand access to smaller employers. Small and medium-sized businesses represent a lot of the hiring capacity across the country, and they are often the ones who stand to benefit most from one or two hires. Making these visa programs accessible across industries and across the country could go great lengths to eroding the labor gap.
Again, these programs already have strict legal vetting. Streamlining doesn’t mean cutting corners, it means making the system faster, fairer, and more efficient, so employers and workers can both benefit.
Immigration as One Part of the Workforce Strategy
While immigration can go great lengths to reduce the labor gap, it is only one step of many. However, it is arguably the most important one. The steps taken above would reduce turnover costs and improve stability at businesses, freeing up resources to enable them to take steps to further stabilize the labor market. Offering apprenticeships and training programs for underserved communities can bring in workers that employers previously were unable to hire, and also make these jobs more enticing to workers who may not have previously considered them. Working with re-entry pathway programs for formerly incarcerated individuals similarly can open up a large pool of workers. Also employers can offer better enticements to keep workers, such as child care or transportation assistance, and retention bonuses. Additional benefits such as more flexible scheduling, career improvement pathways, and even tuition assistance or reimbursement can further entice new hires. While all of these strategies and more can help improve the situation, they take time, and none will succeed without immigration playing a central role. Deliberate action to improve immigration systems would reduce the strain in the labor market while also freeing up resources so employers can improve outreach to obtain and retain talent.
Time to Align Policy with Economic Reality
The U.S. economy depends on a reliable and stable supply of workers across industries, across wage levels, and across the country. Failure to act to prevent the impact of long-running demographic trends means the domestic labor pool alone can’t meet the needs of employers, especially in physically demanding or lower-paying jobs Americans are less likely to pursue. Employment-based immigration programs were created to solve exactly this kind of labor gap, but unless they are modernized, streamlined, and scaled, they can’t do their job. The solution is not to abandon these programs, but to make them work better. To make them work the way they were intended to work.
Policymakers should treat immigration as a workforce development tool, not just a political issue. Employers should be encouraged—not discouraged—from participating in legal, regulated pathways to find the talent they need. By improving these programs now, the U.S. can build a stronger, more stable, and more sustainable workforce for the future.
About The Author
John E. Dorer has more than 20 years of experience in employment-based immigration services. His company, eb3.work, provides solutions for U.S. firms facing chronic labor shortages.
The firm recruits foreign workers willing to make the investment to live and work in the U.S., then takes them through the green card process so they arrive as permanent residents ready to start work.