Labor Secretary Walsh says the biggest threat on the horizon is not recession

Secretary Walsh: At some point we have to go back to what you described as a normal jobs report. We will not be able to continue to create over 500,000 jobs every month because we will run out of people.

We’re at a point where, if you’re a city, town or federal government, we really need to continue to invest in workforce development, job training. When you enter a recession, not every sector closes. There are certain sectors that remain open. And we have so many sectors in this country now that we’re seeing not only return to operating at pre-pandemic levels, but beyond. Construction, technology, cyber security, electrical engineering are hiring hundreds and thousands of people right now and looking to continue hiring over the next five years. If you’re a city or a state, or if you’re a company for that matter, you want to make sure there’s an educated workforce that can access those jobs when they become available.

This is something a little different from what we have experienced in the past. Seeing people leave their jobs for other jobs – we’ll see more of that in the future. Companies will compete for employees in the future.

I’m pretty sure I don’t think we’ll be back. Just as the workplace won’t go back to that nine-to-five, Monday-to-Friday face-to-face, our workforce will look a little different in the future. We must be prepared as a country for this.

We still have a lot of workers who are left behind, especially in communities of color and among women, and they’re still sitting on the sidelines. And we have a certain number of workers resistance to employers’ back-to-office plans. How do you see this all shaking out?

Workers who have decided for whatever reason not to be part of the workforce today will eventually have to go into the workforce unless they are independently wealthy. I think that alone will bring people back into the workforce.

What I hear often from employers is that as they think about the future of work in America, there will be more jobs and more people for those jobs. All employers tell me they need comprehensive immigration reform and visa programs they can use to sponsor people if they can’t find workers. And in many of these spaces, they can’t.

At some point, Congress is going to have to have a real honest conversation about immigration reform and what it means for the future of our economy. The biggest threat to our employers and our economy in this country over the next few years will be the lack of workers. Because we don’t have them; they are not physically here.

Gen Z is entering the workforce in a big way and is getting a lot of attention for various job trends. How much should employers consider Gen Z’s attitude to work?

Every generation that comes has a correction. Gen Z, you have to remember, has spent the last year or two on Zoom in schools, interviews, and work.

When I was mayor of Boston, a lot of millennials came to work for me at City Hall. And I was older and had to adapt to the millennial language and the millennial mindset. That’s a good thing.

People want better pay, better titles, more wages, better working conditions. If you’re an employer and you’re attracting these Gen Zs to your company, you need to be creative. If you are recruiting, sometimes your business model is so strong that the worker has to adapt to the business model. But in many cases, companies must adjust to workers’ expectations.

Quietly giving up seems to be everywhere these days. What is your take on this trend and do you think it has any long-term implications for the workforce or the economy as a whole?

I think it replaces the Great Resignation. I think for a while people resigned. They were looking for better opportunities. I think a quiet exit means they are leaving a job or looking for better opportunities. So it’s pretty much the same thing.

[Editor’s note: Quiet quitting is actually when workers are not outright quitting their job; they’re still performing their duties, but they’re quitting the idea of going above and beyond.]

That will probably even out at some point. But here is a huge opportunity to capture this moment in time. Employers must adapt and change to today’s structure.

I’ve had many conversations with employers across America who are accommodating different types of work styles and work-life balance. The one thing the pandemic has shown, and which I think will remain for some time, is that people are looking for a better work-life balance. There’s no arguing about that.

Much of the quiet exit is happening at large financial institutions with people who have second and third homes. And their work-life balance isn’t exactly what they want. They realized with the pandemic that they missed their family, maybe their personal health. For the foreseeable future we will see more and more of this until it levels off.

Unionization efforts are popping up across the country. Could this be a tipping point for unions to regain ground in the US? Some experts have said it’s an effect of a better-educated workforce – what’s your take?

I think that’s part of it, the better educated workforce. You see workers organizing who are either in college or going to college. You see younger people, between the ages of 18 and 25; 70% of this population viewed organized labor favorably as an opportunity to place itself in a position of strength.

People say they understand the importance of collective bargaining. What I mean by this is not simply collective bargaining in relation to organized labour, but collective bargaining in relation to the organization of a shop or business. Workers work together – we saw that with Google, where workers came together and said, “Look, we’re not being treated the same. We are not being treated fairly.” The benefit of collective bargaining is that it gives you equal pay for equal work. There is a unique opportunity right now for workers and management to have better conversations and better opportunities and move the workforce and the economy forward.

President Biden announced his student loan forgiveness plan last week. Do you think this will have any long-term impact on the job market?

No, I don’t think it will affect the job market. What student loan forgiveness will allow people who have access to it is the ability to create better pathways. Many young people go to school for a certain degree and career and when they graduate, they end up having to switch to a completely different field because they can’t afford to go into the field they studied for. So I think it will create better pathways into those industries. It can also help a young person start buying a home or put themselves in a better situation. This can give people a little breathing room so they don’t have to do all three tasks.

They will still have student loan debt. This is up to $10,000 per individual and up to $20,000 per Pell Grant. Anyone who has attended any college, even a moderate-cost college, will still have loans to pay off.

The recent Job Vacancies and Labor Turnover Survey (JOLTS), released Tuesday, showed job openings holding steady at more than 11 million, workers still switching jobs and minimal layoffs. As you look at all these indicators, where do you see the US economy?

The way I look at it — and let me preface this by saying I’m not an economist — we’re trying to compare this point in time to another point in time, whether it’s the beginning, the middle, or the end of the recession.

The pandemic has highlighted inequalities in the workplace. You have a lot of people who have left their jobs in the last year but are not out of the labor force. They are looking for new job opportunities. You have companies still hiring. Yes, there are some tech companies and some random companies across the country that are downsizing for various reasons. But I think the market will remain strong for the foreseeable future.

President Biden’s policies are working. I think some of the investments in the infrastructure bill and the CHIPS Act will have long-term support for the country. The Inflation Reduction Act will have some faster responses to inflation, but many of these things are long-term and will benefit us economically in the future.

Let’s hypothetically say we have a downturn in the economy in a few years. The infrastructure law will come into effect. So that would make up for those potentially lost jobs.