BlackRock Inc.
What Happened: Speaking at CERAWeek, an annual energy conference organized by S&P Global Inc. nearly a month ago, Fink highlighted the country's labor shortages, which are only set to get worse with the new administration's immigration policies and an increasingly tough stance on illegal immigration.
Fink said that the pace at which deportations are taking place will have a severe impact on the agriculture sector, with not nearly enough hands to harvest the crops when spring arrives.
"70% of the men and women who work in agriculture were not born in the United States, he says, and while several of them are U.S. citizens, or have work permits, many of them do not." It's a similar scenario for construction, with 40% of workers not born in the country, putting them at risk of deportation.
Larry Fink $BLK manages $11 trillion "The USA doesn't even have enough workers to become a manufacturing economy"
The famed pioneer of environmental, social, and governance (ESG) principles further states that this will have an inflationary effect on the economy. Fink also mentions having emphasized the current 'shortage of electricians to build AI data centers' to members of the Trump team.
This was a shot at the Donald Trump administration's plans for reindustrialization in the U.S. The BlackRock CEO is treading cautiously on the political front, as evidenced by his recent annual letter that shies away from any mention of Trump, tariffs, ESG, DEI, or climate change.
Why It Matters: Several other business leaders, analysts, and industry experts have highlighted the improbability of bringing manufacturing back in its entirety to the United States.
Financial commentator Peter Schiff, was one such notable voice last week, who said that it would cost Nike Inc. more to manufacture in the U.S. than it would to just pay the tariffs and pass on the costs to consumers while exploring other markets to make up for lost sales
The biggest roadblock for U.S. manufacturing is shortages in skilled labor. According to a recent report by Bain & Company, nearly 50% of manufacturing workers in the country are aged 50 and above, and 25% are aged 55 and above, but as they start to retire, there aren't enough Gen Z workers to fill these jobs.
According to a report by The Manufacturing Institute, there is a monumental shortage of workers in the U.S. today for jobs that require more than a high-school diploma, but less than a four-year college degree. The candidates for such jobs were immigrants, but now that too is no longer an option for the industry.
At 340 million, the United States has a lot bigger workforce today than it did during its Industrial Revolution in the early 1900s, but the country today is very different culturally and demographically.
For one, the percentage of the country's population between the ages of 15 and 30 stands at 20% today, as opposed to 54% in the 1900s. Besides this, back-breaking manufacturing jobs are no longer sought after by the nation's youth, not that they ever were.
