Addressing the Labor Shortage in Massachusetts: Engaging Untapped Talent

Jerry Rubin and Ayanna Warrington

September 2023

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Contents

Executive Summary

Introduction

Social and Demographic Trends in Massachusetts

Untapped Talent

Addressing The Barriers for All Untapped Talent

Conclusion

Data and Methodology

Endnotes

Massachusetts is facing an extremely tight labor market, witnessing a historic high of over two job openings for every unemployed individual. Consequently, employers are encountering significant challenges in both recruiting and retaining workers.

Long term trends raise even greater concerns. Massachusetts’ population is aging, while the birth rate declines. Outmigration is increasing, and immigration has decreased significantly. None of these trends are likely to change soon.

However, the state has enormous untapped talent. Around 400,000 Massachusetts individuals are underemployed and tens of thousands more are not working up to their skill capacity or ambitions. Massachusetts is not suffering from a shortage of talent. The real issue lies in the state’s inability to fully include its untapped talent, including workers of color, foreign-born individuals, justice-involved citizens, caregivers, disabled workers, and young and older workers.

These individuals, despite their immense potential and skills, have long been underutilized due to systemic barriers. Too many employers, workforce development practitioners, and policymakers have not made the necessary changes that would allow for these individuals to enter the workforce and thrive. Some of these barriers include social, educational, and economic challenges; reluctance on the part of employers to adopt skills-based hiring practices and address discriminatory Applicant Tracking Systems; unpaid learning opportunities; and inadequate or underfunded support services (e.g., childcare and transportation).

A different approach must be taken by these three actors–employers, workforce development practitioners, and policymakers–to create a system that is more inclusive. In this report, we outline the actions that these three groups can take to address the barriers that have stood in the way. We also present examples of organizations that have developed new models to creatively tackle those barriers. By adopting our recommended practices, Massachusetts can address its workforce shortage, create more opportunities for economic prosperity, and become a leader in the nation for engaging untapped talent.

Massachusetts is experiencing one of the tightest labor markets in modern history, posing significant implications for business operations and economic growth. Amidst this disruption, there are emerging opportunities for individuals who have been historically excluded from the state’s economic prosperity.

Since March 2020, the labor market has undergone a series of dramatic shifts. Just prior to the pandemic, Massachusetts was experiencing a tightening labor market and significant worker shortages. Then, economic uncertainty coupled with increased concern for public health due to the COVID-19 pandemic ushered in a wave of rapid changes to where, how, and if people work. Massachusetts experienced one of the most severe employment disruptions in the nation, moving from one of the lowest unemployment rates in the nation to one of the highest.[1]

As the pandemic has eased and public health restrictions have relaxed, the economy has begun to recover and return to its pre-pandemic conditions. As of June 2023, the nationwide unemployment rate was around 3.5 percent, up slightly from its post-pandemic low, but still historically low.[2] In the same time period, the Massachusetts unemployment rate hovered around 2.6 percent, once again lower than the national rate as it was prior to the pandemic.[3]

Massachusetts’ labor force participation rate (the number of all employed and unemployed workers divided by the state’s civilian population) has not fully recovered from the impact of the pandemic. The rate remains stubbornly low, at 64.6 percent[4]—a decline of nearly a point from one year ago, almost two percent lower than it was just prior to the pandemic, and a major decline from its historic peak of nearly 70 percent in the early 1990s.

Labor force participation (%) in Massachusetts from 2000-2022

Source: U.S. Bureau of Labor Statistics.

Massachusetts is again experiencing a historically tight labor market. While the ratio of job openings per unemployed individual nationally is around 1.63 openings per unemployed individuals,[5] in Massachusetts it remains at a historic high of around two openings for every unemployed individual, with 290,000 openings and around 145,000 unemployed individuals.[6] This measurement of labor supply and demand mismatch is at a historic high, up from 1.4 just prior to the pandemic, and 0.4 a decade ago.

Underemployment and job openings in Massachusetts from 2010-2023

Source (Underemployment): Current Population Survey, IPums USA, cSPA calculations.

Source (Job Openings): U.S. Bureau of Labor Statistics, Job Openings and Labor Turnover Survey.

Employers are struggling to source, attract, and retain talent amid an acute labor shortage. Despite layoffs in the tech sector and business closures in financial services, many employers still cannot find enough workers to fill job openings, particularly in leisure and hospitality, education and health services, and the construction sectors, which have seen substantial and persistent growth, in positions considered to be low and middle-skill jobs.[7]

This paper reveals that Massachusetts is not suffering from a shortage of talent. Instead, the state and its employers are grappling with the consequences of excluding talent, including workers of color, foreign born workers, justice-involved citizens, caregivers, disabled workers, young workers between 18 and 24, and older workers. These individuals, who have long been overlooked due to systemic barriers and biases, hold immense potential that remains untapped. Once the barriers that exclude these individuals from the workforce are addressed and dismantled, Massachusetts can tap into a vast reservoir of untapped potential that will not only benefit the workforce but also drive innovation and economic growth.

Even more concerning than the currently low unemployment and labor participation rates are the long term social and demographic trends that portend labor shortages for the foreseeable future. There are several important factors that are driving this trend.

Massachusetts’s Population is Declining

Between 2010 and 2020, the Massachusetts population grew an average of 0.6 percent annually, but that growth trend is no longer the case. The state’s population declined by 0.5 percent between 2020 and 2021, and by 0.1 percent or nearly 8,000 people between 2021 and 2022.[8] Births in the state are at their lowest since 1940, the natural population growth (births minus deaths) has steadily decreased since 1990, and population growth is expected to turn negative by the end of the decade. Projections also suggest that prime working age individuals between the ages of 20 and 64 will decline by 180,000 individuals by 2030.[9]

Massachusetts’s Population is Aging

Massachusetts has more residents over the age of 60 than under the age of 20. From 2002 to 2021, the state’s population over 65 grew by over 350,000.[10] Massachusetts is an older state, with 18.1 percent of its population over 65 as compared to the national rate of 17.3 percent, and the state is projected to see that gap between its population over 65 and the national rate increase in the coming decade.[11] In addition, many older workers in the state who faced health concerns during the pandemic chose early retirement and have yet to rejoin the workforce.

At the same time, Massachusetts’ births have been in steady decline since the early 1990s, dropping by nearly 30 percent since that time and by 40 percent since their peak in the early 1960s.[12]

As Massachusetts’s population ages and its birth rate declines, the state is losing future skilled workers. College attendance rates are declining, which reduces the pool of highly educated workers. In Massachusetts, college enrollment has declined by nearly 10 percent since 2017.[13] The pandemic has only exacerbated this trend, as evidenced by Boston’s 11 percentage point decrease in college enrollment among high school graduates between 2019 and 2021.[14]

Share of the Massachusetts Population Over 65

Source: Massachusetts Population Estimates Program, UMass Donahue Institute.

Massachusetts is Losing More Residents Than It’s Gaining

Legal immigration sharply declined due to global travel restrictions caused by the pandemic and the policies of the Trump administration, many of which remain in force.[15]According to J.P. Morgan, the lack of immigration reduced the U.S. workforce by 3.2 million workers.[16] Massachusetts’ international legal immigration declined by 75 percent since its peak in 2017 from 48,580 to 12,680 in 2021, though there was some increase in 2022 and a substantial increase in undocumented arrivals in the state.[17] This is a particularly challenging situation for Massachusetts, which has long relied on international immigration to fuel its labor force with approximately one fifth of the state's workforce consisting of immigrants.[18]

At the same time as in-migration is decreasing, out-migration is on the rise as workers move to areas with more affordable costs of living. Between 2020-2021, Massachusetts lost 40,000 more residents through domestic outmigration than it gained through international immigration, reversing a long-term trend.[19]

The pandemic created increasingly complex barriers to employment for workers, many of which remain. Many workers continue to experience long-term health effects of COVID and have been unable to re-join the workforce.[20] Available and affordable childcare was severely limited prior to the pandemic and further shrank during the pandemic.[21] The pandemic reset worker’s priorities and worker expectations have changed. Employees and job seekers now place increasingly high value on flexibility, remote work, benefits, and work/life balance.[22] Not all employers have adjusted to these new demands.

The tight labor market and its likely long-term persistence has enormous implications for current business operations and Massachusetts’ long-term economic growth prospects. Employers across varied sectors such as healthcare, life sciences, retail, and hospitality are finding it very difficult to fill their backlog of openings, and this challenge is being felt by their customers.[23],[24] Longer waits for healthcare services, longer lines at retail establishments, and limited hours at restaurants are becoming commonplace. Employers are responding with wage increases, signing bonuses, increased benefits, and automation solutions, but these strategies are not without their limitations. Another strategy, which some employers are pursuing, is to reach outside of their traditional hiring practices and talent pools to recruit and hire from sources of untapped talent.

Though the labor market is extremely tight, there is still plenty of talent that is often overlooked or, as referred to in this paper, “untapped.”[25] We define untapped talent as encompassing two categories of workers:

As of May 2023, the U.S. Bureau of Labor Statistics reported 9.8 million job openings across the nation, which is a slight reduction over the past year, but a stubbornly high number.[26] In terms of labor supply, in May 2023 there were 6 million unemployed persons (workers in the labor force who are unemployed but actively seeking work), which equates to 1.63 openings per unemployed individuals.[27] An additional 5.7 million persons are not in the labor force but desire employment.[28] However, when a more complete analysis of untapped talent is calculated, including all underemployed workers, the size of the untapped talent pool increases markedly. In March 2020, researchers estimated that 27 million workers in the U.S. were untapped.[29]

In Massachusetts, our calculations shows that there are 400,000 underemployed individuals (including unemployed, discouraged, and unintentionally part-time). While it is difficult to calculate the “underutilized” portion of the workforce, we can safely assume that the number is in the tens of thousands. Among prime age workers, defined as between 25 and 54, our research again shows that there are 240,000 underemployed individuals, or one in eleven out of the workforce. With this expanded definition of untapped talent, the ratio of job openings to untapped prime working age individuals is closer to one to one.

An untapped talent analysis casts a very particular light on Massachusetts’ labor shortage. There is not so much a shortage of potential workers as there is a failure to adequately prepare and match existing talent with job openings. Many job seekers hoping to join the labor force remain overlooked by traditional recruitment methods and workforce development strategies. A different approach to workforce development is required to unlock new labor pools that meet employer’s needs and open opportunities for those that have been left behind.

Who Comprises Our Untapped Talent?

We have identified seven major categories of individuals that comprise most of the untapped talent in Massachusetts: workers of color, foreign born workers, justice-involved citizens, caregivers, disabled workers, young workers between 18 and 24, and older workers.

Underemployment rate for various populations in Massachusetts

Source: Current Population Survey, IPums USA, cSPA calculations.

Number of underemployed workers across various populations in Massachusetts

Source: American Community Survey, IPums USA, cSPA calculations.

In many cases, these workers are from marginalized communities and face circumstances that present barriers to employment and require targeted solutions. These barriers include educational and/or skill deficiencies, language barriers, work/life barriers, legal barriers, and physical barriers. They also include a wide range of structural hiring barriers, ranging from ignorance, fear, and discrimination, both implicit and explicit. Each of these barriers underscore the importance of targeted recruitment, more inclusive hiring systems, training, and retention approaches that account for the common and specific barriers facing untapped workers, as well as employer culture change that addresses bias and structured habitual discrimination.

Workers of Color

Workers of color, which include all self-identified workers other than White, non-Hispanic, represent the largest number of underemployed workers in Massachusetts, totaling 150,881 individuals. Workers of color are a large and growing segment of the workforce, comprising around 30 percent of the Massachusetts population.[30] This segment of untapped talent overlaps with several other of the more specific segments described below.

Race and underemployment

Source: Current Population Survey, IPums USA, cSPA calculations.

Barriers

Persistent racial discrimination is a significant challenge that plagues all aspects of the talent acquisition and promotion processes. Numerous studies illustrate that automated hiring systems, informal hiring networks, and bias lead to qualified individuals being overlooked for job opportunities even when educational levels are comparable.[31]

This discrimination can perpetuate cycles of stunted career growth and limited economic advancement. Due to higher levels of unemployment and lower levels of labor market participation, workers of color often have less employment experience than their White counterparts, making it difficult to break into the job market. Once in the workforce, workers of color face significant occupational segregation and are over concentrated in occupations with lower quality jobs and lower wages.

Another critical barrier is the lack of access to quality education. In Boston, workers of color tend to have lower educational levels with 39 percent of Black adults and 46 percent of Latinx adults having a high school diploma or less compared to 23 percent for White adults.[32] College attainment is similarly disproportionate with 28 percent of Black adults and 27 percent of Latinx adults having a bachelor’s degree or higher as compared to 56 percent of White adults.[33] These disparities again contribute to the underrepresentation of workers of color in higher-paying industries and positions.

With lower earnings and wealth than White workers, workers of color face significant economic and social instability that can undermine success at the workplace.[34] The lack of economic resources can lead to a host of financial issues like housing insecurity, transportation concerns, childcare challenges, and inability to weather emergencies.[35] Other barriers can include prior justice related experiences, substance abuse, and mental illness.

Addressing the Barriers

Foreign Born Workers

Foreign-born workers and underemployment

Source: Current Population Survey, IPums USA, cSPA calculations.

Massachusetts has the eighth largest population of immigrants nationally with approximately 17 percent of the state’s population being foreign-born.[36] Moreover, one fifth of the Massachusetts labor force is foreign born and over 70 percent of foreign-born residents are between the ages of 18 and 64, meaning they have will have significant impact on the labor market for many years to come, regardless of immigration policy.[37] While the majority of these immigrants are White, there remain key differences in foreign-born resident demographics. For one, immigrants are substantially bifurcated by educational level.[38] Additionally, Massachusetts is home to a significant Latin American immigration population (38.8 percent of the immigrant population) and Asian immigrant population (30.7 percent of the immigrant population), as well as African immigrant population (9.6 percent of the immigration population).[39] Our research shows that about 14 percent of foreign-born workers, or 140,156, are underemployed, and far more are underutilized. This is the one of the largest categories of the underemployed, comprising 35 percent of the total underemployed population.

Barriers

English fluency is a basic requirement for many jobs in Massachusetts. This is a concern because in Massachusetts alone, around one fifth of the immigrant population either does not speak English well or speaks no English at all.[40] Using Boston as an example, immigrants are often precluded from jobs and subjected to lengthy waitlists for English for Speakers of Other Languages (ESOL) classes.[41] With the influx of workforce development funding since COVID-19, some action has been taken to address this issue. However, workforce development providers are still struggling to support immigrants with the depth of assistance needed to complete these classes successfully. Stipends are rarely offered, making it impossible for some job seekers to enroll in ESOL programs. Additionally, the vast majority of ESOL classes are focused primarily or entirely on language acquisition alone, with only 7 percent of ESOL programs focused on integrating job skills and employment supports despite a clear demand for these types of services.[42]

Highly educated immigrants with professional experience or credentials from their home country are often forced to take lower paying jobs when they immigrate to the U.S. if they are able to secure employment at all. A nurse credentialed in Nigeria is likely unable to practice their profession in Boston, although they are highly skilled in an occupation where there is a severe labor shortage. Several programs in Massachusetts like the Welcome Back Center at Bunker Hill Community College and The African Bridge Network address this challenge, though they are limited in scope and scale.

According to the Migration Policy Institute, there are over two million underemployed college educated immigrants residing in the United States, and approximately 62,000 of them reside in Massachusetts. [43] Skilled immigrants face many challenges working in occupations and positions that fully utilize their skills. Language of course is a primary barrier, but in addition there are challenges of having little to no social capital and holding foreign granted professional certifications that are not transferable to American workplaces.

Work authorization is another barrier faced by immigrants in Massachusetts. Twenty two percent of Massachusetts immigrants are undocumented.[44] Although many of these individuals contribute to the workforce, they are unauthorized to work in the U.S. Even documented immigrants face challenges obtaining work authorization.[45] The in-person foreign labor certification process was suspended due to COVID-19. While some support was available online, this created another barrier for immigrants, especially those without access to a computer or internet. Since the pandemic, the nation has seen a work-permit backlog which has caused some immigrants to miss out on employment opportunities.[46] Several specific refugee groups, including Haitians, Afghans and Ukrainians, continue to face long delays and bureaucratic hurdles as they attempt to secure work authorization.[47][48]

Addressing the Barriers

Justice-Involved Citizens

Data from the Massachusetts Department of Corrections indicate that approximately 5,000 individuals each year are released from Massachusetts prisons.[51] Under reasonable assumptions about recidivism, Massachusetts is home to approximately 20,000 individuals who have been released from prison since 2018. From 2013 to 2022, Massachusetts saw a decrease of 45 precent in the incarcerated population.[52] The pandemic accelerated this trend as prisoners were released early due to public health concerns. As a result, we have seen an influx of formerly incarcerated citizens struggling to overcome the stigma of a criminal record and find meaningful employment. In many of the fastest growing job categories, especially in the healthcare sector, prior court involvement often precludes justice-involved citizens from employment. Interestingly, there is some research evidence and substantial anecdotal evidence that justice-involved citizens have both a strong motivation to work and high retention rates.[53] For example, one longitudinal study undertaken by Johns Hopkins Hospital found that a change in their “banning the box” policy on prior applicants resulted in hiring applicants with criminal records who ended up exhibiting a lower turnover rate than those without records.[54]

Barriers

Justice-involved citizens often have limited education and limited work experience in addition to economic challenges that create substantial employment instability.[55] They are also more likely to have mental health issues and suffer from substance abuse.[56]

There are numerous public policies that limit the freedoms of justice-involved citizens (for example, many states prohibit felons from having a driver's license). Private employer policies on hiring and public policies for licensure often limit return citizens’ ability to work in certain occupations and industries.

Addressing the Barriers

Persons with a Disability

A person with a disability is three times less likely to be employed than a person without a disability.[58] In Massachusetts, excluding persons with disabilities from the workforce can have serious ramifications for the labor market given that 11 percent of the adult population has a disability. Of those, only 19.1 percent are employed, compared to 62.1 percent of people without disabilities.[59] Amongst prime aged workers (workers aged between 25 and 54), 34.4 percent of the population with a disability are employed compared to 82.7 percent of all adult workers who are employed.[60] Our research reveals that almost 14 percent of Massachusetts disabled workers, or about 18,060 individuals, are underemployed.

Cognitive disabilities (difficulty with decision making and memory) and ambulatory disabilities are the most common in Massachusetts. The state’s employment gap regarding people with ambulatory difficulties put it behind 40 percent of the country.[61] More than 70 percent of the 159,780 working-aged people in Massachusetts with ambulatory disabilities are unemployed.[62]

Workers with disabilities and underemployment

Source: Current Population Survey, IPums USA, cSPA calculations.

Barriers

Job seekers with disabilities face challenging obstacles when seeking to enter or re-enter the workforce. Some of these challenges include access to transportation, adequate health insurance, and mental health services. Many workplaces are not accessible and are not always required to be accessible.

Many employers are not willing to make the necessary accommodations that would allow disabled workers to thrive in the workplace. As mandated by the Americans with Disabilities Act, workers are entitled to reasonable accommodations (for example, modified job responsibilities, flexible work schedules, adjusted software/equipment, etc.).[63] Yet, many employers are reluctant to make these accommodations as they are viewed as prohibitively expensive.

Often employers are reluctant to hire individuals with disabilities due to concern about how they will fit or be accepted by other employees. Employers may also have concerns about potential legal liabilities stemming from workplace accommodation requirements.

Addressing the Barriers

Younger Workers

Our research finds that younger workers, which we define as workers between the ages of 18 and 24, comprise a substantial portion of the underemployed, with an underemployment rate of 16.9 percent representing around 65,000 individuals. Younger workers have historically experienced higher rates of underemployment than their peers over 25.[64] Young workers of color, especially Black youth, experience the highest rates of unemployment nationally.[65]
 

During the COVID-19 pandemic, younger workers experienced unemployment and underemployment at rates about double their older counterparts, with slower recovery.[66] Younger workers are disproportionately represented in the retail and hospitality sectors, two of the hardest hit sectors during the pandemic, which may help explain why they experienced the greatest job losses and a more difficult recovery.

Underemployed younger workers also tend to have longer term economic consequences than their older peers such as repeated unemployment, lower wages, and lower lifetime earnings.[67]
 

Barriers

Younger workers face a number of significant barriers to employment or full employment. They have less experience than their older counterparts and tend to have shorter term, more sporadic employment experiences, making them less competitive than their older counterparts. Because of their concentration in lower quality jobs in sectors like retail and hospitality, they often are in part-time positions, and are forced to cobble together multiple jobs.[68] And, their concentration in these sectors means they often lack the experience or skills require for consideration for positions in other higher paying sectors and occupations.

 Addressing the Barriers

Older Workers

Over 18 precent of Massachusetts’ population is older than 65 years of age.[69] Because of the COVID-19 pandemic, many Americans opted into early retirement due to public health concerns and rising asset values. Others were forced into unemployment due to layoffs and other economic shifts. That said, older workers are strongly attached to the labor market, but given their overall numbers, represent a very large pool of untapped talent. Our research shows that almost eight percent of older workers representing around 67,000 individuals are underemployed. There is opportunity to identify and successfully re-integrate retirees and other older workers who have been excluded from the workforce.

Barriers

Data shows that after losing or quitting a job, it takes older workers longer to find new employment compared to younger workers. Part of this challenge can be attributed to skill gaps and the need for new occupational training. For example, in Boston, employment for workers over the age of 45 is concentrated in operative and laborer roles (e.g., assembly line operator) that have heightened risk of job displacement due to technological advancements in automation or outsourcing.[70] These workers are most vulnerable to negative shocks in the national or global economy. In the case of COVID-19, a small number of older workers successfully transitioned into remote jobs across finance, professional, and technical services. Highly skilled and higher income individuals had the resources and educational capital necessary to make this shift. However, many mature workers who seek to re-enter the workforce need appropriate occupational training that builds on their existing skill sets and prepares them for roles in high growth industries.

Older workers also face a higher risk of having health concerns or disabilities that make maintaining employment difficult. This trend is magnified as a worker ages.

Addressing the Barriers

Caregivers

Caregivers including mothers with young children and those responsible for elder care make up a substantial portion of untapped talent. Our research finds that there are 30,000 underemployed prime age women with children under five years old in Massachusetts. If we look at mothers at home with children aged around three- to four-years old—the age when many children enter pre-school—, we find that around 19 percent are underemployed or about 8,206 mothers. Prime age workers living with a disabled senior represent another 15,000 underemployed workers and face an underemployment rate of 16.7 percent.

Workers with dependents and underemployment

Source: American Community Survey, IPums USA, cSPA calculations.

Barriers

Access to affordable, quality childcare is a major barrier to employment. Nationally, more than a third of families with young children report difficulty finding childcare.[71] Additionally, the childcare that is available is expensive. From the 1970s to the 2000s, the cost of childcare doubled, often consuming a substantial portion of workers’ pay.[72] Massachusetts is the second most expensive state to purchase childcare.[73] Childcare subsidies are insufficient and typically limited to only the lowest income workers. The shortage of available childcare worsened during the COVID-19 pandemic as many centers closed and many teachers did not return once centers re-opened. Childcare supply shortages are due in part to the shortage of teachers, a job that generally offers low pay and carries significant training and certification requirements.

Elder care is similarly limited by both availability and cost. The closure of many residential and day facilities during the COVID-19 pandemic worsened a shortage that was already severe, which is attributed to the low wages and physically and mentally demanding work tied to the job.[74] Many long-term care workers who faced dangerous and extremely difficult working conditions during the pandemic now have higher paying and less physically challenging alternative employment opportunities in retail, hospitality, and other growing sectors. As a result, home health agencies are rejecting far more applicants, and family members are increasingly being forced to care for their elderly relatives, limiting their ability to work.[75]

Addressing the Barriers

While different segments of untapped talent require targeted strategies to address their barriers, some employer, workforce development, and public policy strategies are relevant for all segments of untapped talent.

The data is very clear. Massachusetts is facing a shortage of workers that threatens the long-term economic growth prospects of the Commonwealth and its residents. It is also clear that Massachusetts does not have a shortage of talent. Instead, the state is experiencing the results of failing to adequately prepare, hire, and support the tens of thousands of Massachusetts residents who want to enter the workforce, work more than they are working, and grow their skills and earnings. Rarely has there been such a coincidence of economic imperatives and social opportunity.
 

We have many leading examples in our own backyard of employers, educators, trainers, and government leaders who are directly embracing our untapped talent and creatively addressing their barriers. Their stories reinforce the data that demonstrates the solid returns for both employers and untapped workers when they are prepared, hired, and supported. It remains to be seen whether Massachusetts can move beyond the pilots and anecdotes to become the untapped talent leader of the nation.

Unemployment and labor participation data was drawn from the Bureau of Labor Statistics, Massachusetts Economy at a Glance. Underemployment data is calculated by pooling 12 months from the Current Population Survey (CPS) microdata made available by IPUMS CPS, covering May 2022 to April 2023. Our measure of underemployment is broad, capturing those who are out of the workforce or limited to part-time work for a wide variety of reasons, including weak business conditions and challenges around childcare. Data on caregivers is from the 2021 American Community Survey (ACS) microdata from IPUMS USA. Because it covers a different time period, and draws on a different survey, the underemployment measures are different, though care was taken to calibrate them appropriately. Data on prison releases is drawn from the Massachusetts Department of Correction releases dashboard. Population projections were drawn from the Massachusetts Population Estimates Program at UMass-Donahue Institute. Other population data come from Massachusetts Taxpayers Foundation-Donahue Institute study “Massachusetts’ Demographic Trends Threaten our Talent Pipeline and Economic Strength”, 2023. Case studies were developed from interviews carried out between January and April 2023, along with a literature review that included publicly available documents and internal operational documents shared by the case study organization.

The Eastern Bank Foundation and SkillWorks helped fund the Project on Workforce’s Visiting Fellow, Jerry Rubin, in conducting the research for this paper. Research and data analysis was supported by Evan Horowitz, Executive Director of the Center for State Policy Analysis at Tufts University. Data and case study research was supported by the Project on Workforce Research Assistant Shane Lancer.

Please direct inquiries to: Jerry Rubin, j.rubin@easternbank.com

Suggested citation: Jerry Rubin, Ayanna Warrington. (September 2023). “Addressing the Labor Shortage in Massachusetts: Engaging Untapped Talent.” Published by Harvard Kennedy School.

About the Authors

Jerry Rubin is a Visiting Fellow at the Project On The Workforce at Harvard, and a Foundation Fellow at the Eastern Bank Foundation. He retired in 2022 after serving for fifteen years as President and Chief Executive Officer of Jewish Vocational Services, Inc. a leading workforce development organization. Prior to joining JVS, Jerry was Vice President of Building Economic Opportunities at Jobs for the Future, a national workforce development and education policy, research, and consulting organization. Jerry founded and was Executive Director of two nonprofit organizations: the Greater Boston Manufacturing Partnership, a training and consulting organization; and the Coalition for a Better Acre, a community development corporation based in Lowell, Massachusetts. Jerry also spent ten years in the administration of Boston Mayor Raymond L. Flynn leading several housing, economic development and workforce development initiatives. Jerry holds a Bachelor’s Degree in Government from Clark University and a Master’s Degree in City Planning from the Massachusetts Institute of Technology. He is the author of numerous book chapters, articles, and monographs on housing, economic development and workforce development issues. Jerry is a board member of the Economic Empowerment Trust Fund of the Commonwealth of Massachusetts, the Massachusetts Immigration and Refugee Advocacy Organization, and the Hyde Square Task Force.

Ayanna Warrington holds an MBA from the Wharton School and an MPA from the Harvard Kennedy School. She is passionate about solving "people problems" and building up minority communities. Ayanna has worked as a human capital consultant for Deloitte where she helped guide high-tech companies through complex organizational changes and co-authored two thought pieces on inclusive leadership during times of crisis and supporting the Black workforce. Currently, she is a Chief People Officer-in-Residence at Alpine Investors.

About the Project on Workforce at Harvard

The Project on Workforce is an interdisciplinary, collaborative project between the Harvard Kennedy School’s Malcolm Wiener Center for Social Policy, the Harvard Business School Managing the Future of Work Project, and the Harvard Graduate School of Education. The Project produces and catalyzes basic and applied research at the intersection of education and labor markets for leaders in business, education, and policy. The Project’s research aims to help shape a postsecondary system of the future that creates more and better pathways to economic mobility and forges smoother transitions between education and careers. Follow our research at www.pw.hks.harvard.edu/get-updates.

The views expressed in this report are the sole responsibility of the authors and are not meant to represent the views of Harvard University, the Harvard Kennedy School, or the Harvard Graduate School of Education.

 [1] U.S. Bureau of Labor Statistics. “43 States at Historically High Unemployment Rates in April 2020,” May 28, 2020. https://www.bls.gov/opub/ted/2020/43-states-at-historically-high-unemployment-rates-in-april-2020.htm.
 

[2] “The Employment Situation - June 2023.” U.S. Bureau of Labor Statistics, July 2023. https://www.bls.gov/news.release/pdf/empsit.pdf.
 

[3] The Commonwealth of Massachusetts Executive Office of Labor and Workforce Development. “Massachusetts Unemployment & Job Estimates for June,” July 21, 2023. https://lmi.dua.eol.mass.gov/lmi/NewsRelease/state.
 

[4] Ibid.
 

[5] According to the U.S. Bureau of Labor Statistics data of May 2023. “Job Openings And Labor Turnover – May 2023”. U.S. Bureau of Labor Statistics, July 2023. https://www.bls.gov/news.release/archives/jolts_07062023.pdf
 “The Employment Situation - May 2023.” U.S. Bureau of Labor Statistics, June 2023. https://www.bls.gov/news.release/archives/empsit_06032022.pdf.
 

[6] According to U.S. Bureau of Labor Statistics data of January 2023. “Massachusetts Job Openings and Labor Turnover,” January 2023. https://www.bls.gov/regions/northeast/news-release/jobopeningslaborturnover_massachusetts.htm.
 

[7] Mass.gov. “Department of Economic Research Labor Market Information,” 2022. https://www.mass.gov/orgs/labor-market-information.
 

[8] USAFacts. “Our Changing Population: Massachusetts,” July 2022. https://usafacts.org/data/topics/people-society/population-and-demographics/our-changing-population/state/massachusetts/.
 

[9] Massachusetts Taxpayers Foundation. “Massachusetts’ Demographic Trends Threaten Our Talent Pipeline and Economic Strength,” December 14, 2022. https://www.masstaxpayers.org/massachusetts-demographic-trends-threaten-our-talent-pipeline-and-economic-strength
 

[10] Knoema. “Massachusetts Population Aged 65 Years and Over,” 2021. https://knoema.com//atlas/United-States-of-America/Massachusetts/topics/Demographics/Age-Structure/Population-aged-65-years-and-over.
 

[11] United States Census Bureau. “U.S. Census Bureau QuickFacts: Massachusetts,” 2022. https://www.census.gov/quickfacts/fact/table/US,MA/PST045222.
 

[12] Knoema. “Massachusetts Crude Birth Rate,” 2022. https://knoema.com//atlas/United-States-of-America/Massachusetts/topics/Demographics/Fertility/Crude-birth-rate.
 

[13] Carapezza, Kirk. “Massachusetts Education Officials Sound Alarm over College Enrollment Plunge.” News, August 3, 2022. https://www.wgbh.org/news/education/2022/08/03/massachusetts-education-officials-sound-alarm-over-college-enrollment-plunge.
 

[14] Larkin, Max. “New Report Finds Setbacks in College Enrollment and Completion Rates for Boston Public Schools Graduates.” WBUR, March 23, 2023. https://www.wbur.org/news/2023/03/23/boston-students-college-enrollment-completion-report.
 

[15] Bolter, Jessica, and Muzaffar Chishti. “The ‘Trump Effect’ on Legal Immigration Levels: More Perception than Reality?” migrationpolicy.org, November 20, 2020. https://www.migrationpolicy.org/article/trump-effect-immigration-reality.
 

[16] DePillis, Lydia. “Who Are America’s Missing Workers?” The New York Times, September 12, 2022, sec. Business. https://www.nytimes.com/2022/09/12/business/economy/labor-participation-covid.html.
 

[17] Massachusetts Taxpayers Foundation. “Heeding the Warning Signs: What Massachusetts Must Do to Remain Competitive,” August 12, 2022. https://masstaxpayers.org/sites/default/files/publications/2022-08/MTF%20Report%20State%27s%20Cost%20Structures%20FINAL%20REVISION%20%281%29.pdf.
 

[18] American Immigration Council. “Immigrants in Massachusetts,” August 6, 2020. https://www.americanimmigrationcouncil.org/research/immigrants-in-massachusetts
 

[19] Ibid.
 

[20] Bach, Katie. “Is ‘Long Covid’ Worsening the Labor Shortage?” Brookings, January 11, 2022. https://www.brookings.edu/articles/is-long-covid-worsening-the-labor-shortage/.
 

[21] “Demanding Change: Repairing Our Child Care System,” 2022. https://info.childcareaware.org/hubfs/2022-03-FallReport-FINAL%20(1).pdf?utm_campaign=Budget%20Reconciliation%20Fall%202021&utm_source=website&utm_content=22_demandingchange_pdf_update33202.
 

[22] Richardson, Nela, and Marie Antonello. “People at Work 2022: A Global Workforce View-Full Report.” ADP Research Institute, April 25, 2022. https://www.adpri.org/assets/people-at-work-2022-a-global-workforce-view/.
 

[23] White, Martha. “America’s Small Businesses Are Running out of Workers.” CNN Business, August 19, 2022. https://www.cnn.com/2022/08/19/economy/worker-shortage-small-business/index.html.
 

[24] Lucas, Amelia, and Ian Krietzberg. “Restaurants Are Short-Staffed, and That’s Taking a Big Toll on Customers and Workers Alike.” CNBC, July 17, 2022. https://www.cnbc.com/2022/07/17/customer-service-suffers-at-short-staffed-restaurants-as-covid-takes-toll.html.
 

[25] Fuller, Joseph B., Manjari Raman, Eva Sage-Gavin, and Kristen Hines. “Hidden Workers: Untapped Talent.” Print. Boston, MA: Harvard Business School Project on Managing the future of Work, September 2021. https://www.hbs.edu/faculty/Pages/item.aspx?num=61232.
 

[26] “Job Openings And Labor Turnover – May 2023”. U.S. Bureau of Labor Statistics, July 2023. https://www.bls.gov/news.release/archives/jolts_07062023.pdf.
 

[27] “The Employment Situation - May 2023.” U.S. Bureau of Labor Statistics, June 2023. https://www.bls.gov/news.release/archives/empsit_06032022.pdf.
 

[28] Ibid.
 

[29] Fuller, Joseph B., Manjari Raman, Eva Sage-Gavin, and Kristen Hines. “Hidden Workers: Untapped Talent.” Print. Boston, MA: Harvard Business School Project on Managing the future of Work, September 2021. https://www.hbs.edu/faculty/Pages/item.aspx?num=61232.
 

[30] United States Census Bureau. “U.S. Census Bureau QuickFacts: Massachusetts,” 2022. https://www.census.gov/quickfacts/fact/table/US,MA/PST045222.
 

[31] Kline, Patrick, Evan K Rose, and Christopher R Walters. “Systemic Discrimination Among Large U.S. Employers.” The Quarterly Journal of Economics, June 11, 2022. https://doi.org/10.1093/qje/qjac024.
 

[32] Langston, Abbie, Justin Scoggins, and Matthew Walsh. “Advancing Workforce Equity In Boston: A Blueprint for Action.” PolicyLink and USC Equity Research Institute, 2021. https://nationalequityatlas.org/sites/default/files/Advancing%20Workforce%20Equity%20in%20Boston_FINAL_0.pdf.
 

[33] Ibid.
 

[34] Weller, Christian E., and Lily Roberts. “Eliminating the Black-White Wealth Gap Is a Generational Challenge.” Center for American Progress, March 19, 2021. https://www.americanprogress.org/article/eliminating-black-white-wealth-gap-generational-challenge/.
 

[35] Center for American Progress. “African Americans Face Systematic Obstacles to Getting Good Jobs,” December 5, 2019. https://www.americanprogress.org/article/african-americans-face-systematic-obstacles-getting-good-jobs/.
 

[36] American Immigration Council. “Immigrants in Massachusetts,” August 6, 2020. https://www.americanimmigrationcouncil.org/research/immigrants-in-massachusetts.
 

[37] Ibid.
 

[38] Batalova, Jeanne, and Michael Fix. “The Skills and Economic Outcomes of Immigrant and U.S.-Born College Graduates.” Migration Policy Institute, December 2022. https://www.migrationpolicy.org/sites/default/files/publications/Skills-outcomes-college-grads-2022-final.pdf.
 

[39] Migration Policy Institute. “State Demographics Data - MA,” 2022. https://www.migrationpolicy.org/data/state-profiles/state/demographics/MA.
 

[40] American Immigration Council. “Immigrants in Massachusetts,” August 6, 2020. https://www.americanimmigrationcouncil.org/research/immigrants-in-massachusetts.
 

[41] “The ROI of ESOL: The Economic and Social Return on Investment for ESOL Programs in Greater Boston.” Boston, MA: The Kitty and Michael Dukakis Center for Urban and Regional Policy at Northeastern University, The Boston Foundation, and the Latino Legacy Fund, December 2019. https://www.tbf.org/-/media/tbf/reports-and-covers/2020/roi-of-esol_20200206.pdf.
 

[42] Roder, Anne, and Mark Elliott. “Interim Findings on JVS Boston’s English for Advancement Show Large Earnings Gains.” Economic Mobility Corporation, November 2020. https://economicmobilitycorp.org/wp-content/uploads/2020/10/SteppingUp.pdf.
 

[43] Migration Policy Institute. “State Immigration Data Profiles,” 2021. https://www.migrationpolicy.org/data/state-profiles/state/workforce/US/MA/.
 

[44] American Immigration Council. “Immigrants in Massachusetts,” August 6, 2020. https://www.americanimmigrationcouncil.org/research/immigrants-in-massachusetts
 

[45] Bier, David J. “Processing Backlogs in the U.S. Immigration System: Describing the Scale of the Problem.” Cato Institute, October 6, 2022. https://www.cato.org/briefing-paper/processing-backlogs-us-immigration-system-describing-scale-problem#.
 

[46] Ibid.
 

[47] “Citizenship and Immigration Services Annual Report 2022.” U.S. Department of Homeland Security, June 30, 2022. https://www.dhs.gov/sites/default/files/2022-07/2022%20CIS%20Ombudsman%20Report_verified_medium_0.pdf.

[48] Williams, Nirvani. “‘Anybody’s Guess How Long It Will Take’: Haitians Resettling in Agawam Wait for Federal Protections.” WBUR, June 2, 2023. https://www.wbur.org/news/2023/06/02/temporary-protected-status-haitian-immigration-massachusetts.
 

[49] Commonwealth Corporation. “Workforce Training Fund Program,” 2023. https://commcorp.org/program/workforce-training-fund-program/.
 

[50] Migration Policy Institute. “State Immigration Data Profiles,” 2021. https://www.migrationpolicy.org/data/state-profiles/state/workforce/US/MA/.
 

[51] Mass.gov. “Releases Dashboard,” 2023. https://www.mass.gov/info-details/releases-dashboard.
 

[52] Cannata, Nicholas C, Hollie Matthews, Benjamin Desrochers, Susan McDonald, Alexandria Sahtouris, Ruben Lema, and Jiqiang Rong. “Massachusetts Department of Correction Prison Population Trends 2021.” Massachusetts: Commonwealth of Massachusetts Executive Office of Public Safety and Security, 2021. https://www.mass.gov/doc/prison-population-trends-2021/download.
 

[53] Russo, Joe, Samuel Peterson, Michael J. D. Vermeer, Dulani Woods, and Brian A. Jackson. “Improving Employment Outcomes for the Federal Bureau of Prisons’ Returning Citizens.” RAND Corporation, 2023. https://doi.org/10.7249/RRA108-18.
 

[54] Paulk, Pamela D. “The Johns Hopkins Hospital Success in Hiring Ex-Offenders.” Baltimore, Maryland, Setpember 2016. https://www.diversityincbestpractices.com/medialib/uploads/2016/09/Paulk-Presentation-Hiring-Ex-Offenders-09142016.pdf.
 

[55] McGrew, Annie, and Angela Hanks. “The Case for Paid Apprenticeships Behind Bars.” Center for American Progress (blog), April 27, 2017. https://www.americanprogress.org/article/case-paid-apprenticeships-behind-bars/.
 

[56] Russ, Ebony N., Lisa Puglisi, Gabriel B. Eber, Diane S. Morse, Faye S. Taxman, Meaghan F. Dupuis, Evan Ashkin, and Warren J. Ferguson. “Prison And Jail Reentry And Health.” Health Affairs, October 28, 2021. https://www.healthaffairs.org/do/10.1377/hpb20210928.343531/full/.
 

[57] Interview with Imanni Burg on May 15, 2023.
 

[58] Ives-Rublee, Mia, Rose Khattar, and Lily Roberts. “Removing Obstacles for Disabled Workers Would Strengthen the U.S. Labor Market.” Center for American Progress (blog), May 24, 2022. https://www.americanprogress.org/article/removing-obstacles-for-disabled-workers-would-strengthen-the-u-s-labor-market/.
 

[59] United States Census Bureau. “Current Population Survey (CPS),” 2023. https://www.census.gov/programs-surveys/cps.html.
 

[60] Ibid.
 

[61] Steinberg, Carol. “For The Disabled, Office Accessibility Is Often A Dealbreaker — But It Doesn’t Have To Be – Accessible Massachusetts.” Accessible Massachusetts, November 9, 2018. https://accessiblema.org/2021/11/18/for-the-disabled-office-accessibility-is-often-a-dealbreaker-but-it-doesnt-have-to-be-2/.
 

[62] Ibid.
 

[63] ADA.gov. “Americans with Disabilities Act Title III Regulations,” March 8, 2012. https://www.ada.gov/law-and-regs/title-iii-regulations/.
 

[64] Gould, Elise, and Melat Kassa. “Young Workers Hit Hard by the COVID-19 Economy.” Economic Policy Institute, October 14, 2020. https://www.epi.org/publication/young-workers-covid-recession/.
 

[65] U.S. Bureau of Labor Statistics. “Labor Force Statistics from the Current Population Survey,” 2023. https://www.bls.gov/web/empsit/cpsee_e16.htm.
 

[66] Gould, Elise, and Melat Kassa. “Young Workers Hit Hard by the COVID-19 Economy.” Economic Policy Institute, October 14, 2020. https://www.epi.org/publication/young-workers-covid-recession/.
 

[67] Ibid.
 

[68] Opportunity Nation. “Youth Unemployment.” Accessed August 8, 2023. https://opportunitynation.org/youth-unemployment/.
 

[69] United States Census Bureau. “U.S. Census Bureau QuickFacts: Massachusetts,” 2022. https://www.census.gov/quickfacts/fact/table/US,MA/PST045222.
 

[70] Jan Mutchler, Brittany Gainess, Ping Xu, and Caitlin Coyle. “Older Workers in Boston: An Age-Friendly Perspective.” Boston, MA: University of Massachusetts Boston, September 2018. https://www.boston.gov/sites/default/files/embed/b/boston_older_worker_white_paper.pdf.
 

[71] Kamenetz, Anya, and Mansee Khurana. “1 in 3 Working Families Is Struggling to Find the Child Care They Desperately Need.” NPR, October 19, 2021, sec. Shots - Health News. https://www.npr.org/2021/10/19/1047019536/families-are-struggling-to-find-the-child-care-they-desperately-need.
 

[72] Thompson, Derek. “Why Child Care Is So Expensive - The Atlantic.” The Atlantic, November 26, 2019. https://www.theatlantic.com/ideas/archive/2019/11/why-child-care-so-expensive/602599/.
 

[73] Economic Policy Institute. “Child Care Costs in the United States,” October 2020. https://www.epi.org/child-care-costs-in-the-united-states/.
 

[74] Linda Matchan. “Why Can’t I Find a Home Health Aide in Massachusetts?” The Boston Globe, June 5, 2023. https://www.bostonglobe.com/2023/06/05/magazine/why-its-hard-to-find-a-home-health-aide-in-massachusetts/.
 

[75] Ibid.
 

[76] Economic Policy Institute. “Child Care Costs in the United States,” October 2020. https://www.epi.org/child-care-costs-in-the-united-states/.
 

[77] Jung, Carrie. “Report: Boston’s Child Care Capacity Remains below Pre-Pandemic Levels.” WBUR, May 3, 2023. https://www.wbur.org/news/2023/05/03/child-care-report-low-supply.
 

[78] “Draft Minutes.” Barnstable County Economic Development Council, January 11, 2023. https://www.capecodcommission.org/resource-library/file?url=%2Fdept%2Fcommission%2Fteam%2Fed%2FBCEDC%2FBCEDC+Meetings%2F2023-02-08+BCEDC%2FBCEDC+02-08-2023%2F2023-01-11+Draft+BCEDC+Meeting+Minutes.pdf.
 

[79] Neighborhood Villages. “Neighborhood Villages,” 2023. https://www.neighborhoodvillages.org.