Employment in a Changing Economy

Changes in the American economy in the 21st century are affecting the U.S. workforce in significant ways, and in some cases reshaping the nature of work. For instance, advancements in artificial intelligence, robotics, and other new technologies are leading to increased automation and changes in work tasks. Also, employers are increasingly using digital surveillance tools to monitor workers, which could help improve operations but has led to concerns from worker advocates. There has also been an increase in nonstandard work arrangements. For example, there has been growth in the number of gig workers obtaining employment through online platforms, and employers are increasingly using temporary, part-time, or contracted workers. These nonstandard work arrangements may have implications for workers’ safety, wages, and access to benefits.

Camera Used to Digitally Monitor Workers   

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In addition, the economic shocks resulting from the COVID-19 pandemic, including widespread business closures, unprecedented levels of unemployment, and general health and safety concerns have accelerated certain structural changes, such as increased telework and automation. The share of workers who teleworked most of the time tripled during the pandemic, from about 6% in 2019 to about 18% in 2021. The pandemic may have lasting effects on how and where work is done across the economy, as well as employer demand for workers or certain skills in some sectors—which may lead to some workers continuing to face long-term unemployment.

Sustained attention by federal agencies, including the Departments of Labor and Education, and coordination between federal, state, and local agencies is important for understanding and responding to this changing employment landscape and workforce needs. Additionally, where workers face disruptions or displacement, unemployment insurance, employment adjustment assistance, and other federal programs can provide critical support and protection, including getting workers proper training to meet the new needs of the changing economy.

However, federal agencies could improve how they provide such employment supports.

For instance:

• Ergonomic hazards for warehouse and delivery workers. In recent years, the most common occupational hazard for warehouse and delivery workers was overexertion, which can cause musculoskeletal disorders like tendonitis or back pain. However, the Occupational Safety and Health Administration (OSHA) faces challenges in identifying, assessing, and addressing ergonomic hazards. In FY 2024, OSHA implemented an inspection program to better protect warehouse and delivery workers. However, OSHA needs to improve its injury data, training, and guidance on ergonomic hazards, and evaluate the effectiveness of its new inspection program.
• Unemployment insurance. During the pandemic, unemployment benefits were temporarily expanded to cover more workers, such as self-employed and gig workers who are not typically eligible. Millions of workers relied on this unemployment support to meet their urgent financial needs. However, the temporary benefit expansion expired in 2021 and many workers now lack access to this support. To ensure the unemployment insurance system—which has been on the High Risk List since 2022—reflects the modern economy, the Department of Labor should examine options to systematically support such unemployed workers moving forward. It should also identify and address inequities in who receives unemployment benefits, and assess lessons learned from the pandemic related to emergency planning, and implement an antifraud strategy, as it works on transformational changes to the system.  
• Workforce development. The Departments of Labor and Education oversee 6 core workforce development programs that help job seekers find work and employers find qualified employees. The departments require the programs to submit data on their participants and have taken steps to help them do so. But the departments still don't have complete data on participants who are enrolled in multiple programs. For example, program data submitted to Labor didn't include co-enrollment information on up to 67% of participants.