The shortage of workers in the United States is imminent and is predicted to reach six million by the end of the decade, however, immigration could be an important solution to this challenge. The study by Lightcast, a labor market data company, highlights several trends that are contributing to this shortage, including rising retirements, declining male labor force participation, and a lack of enough new entrants to replace retirees.

The study projects that starting in 2027, for the first time, the number of Americans who will turn 65 — the traditional retirement age — will exceed the number of young people who will turn 16. This reflects a demographic imbalance that threatens to reduce the workforce while the consumer population increases, potentially resulting in price increases and product shortages.

In addition, there is a worrying drop in working-age men's labor market participation, caused in part by the rise in substance abuse and incarceration, which together have taken 4.6 million Americans out of the workforce. This further exacerbates the shortage in skilled jobs, dominated by men.

According to the study, commented on by the publication of the Latin Times, immigration has been a compensating factor for this trend. In 2023, 18.6% of the U.S. workforce was made up of immigrants, up from 15.3% in 2006. This increase in the participation of immigrants, according to economists such as Mark Zandi, has relieved the pressure on the American economy, contributing to economic growth in recent years.

Immigrants tend to be younger, which helps counterbalance the aging workforce. While the birth rate in native families is declining and the baby boom generation is exiting the workforce, immigrants have become an important solution to maintain the productive force.

Even with Lightcast's gloomy forecast, the Congressional Budget Office (CBO) estimates that the U.S. workforce will grow by 5.2 million by 2034, driven primarily by immigration. This growth is expected to contribute to a $7 trillion increase in gross domestic product (GDP) and $1 trillion in government revenues, according to the Latin Times.

Phillip Swagel, director of the CBO, reinforces that more workers lead to higher production and higher income, which, in turn, increases government revenue. Therefore, immigration not only mitigates the shortage of workers, but also has a positive impact on the country's economic growth.

The combination of mass retirements reduced male participation in the labor force, and an aging American population all point to a looming crisis in the labor force. However, increased immigration emerges as a viable solution, both to fill the vacancies that will be left by retirees and to maintain U.S. economic growth for years to come.