Labor shortage could constrain growth
Bouten Construction crews work on the Kootenai County Justice Building expansion project in downtown Coeur d'Alene. Construction is North Idaho's leading industry, with more jobs added in the last five years than any other industry.
It’s no secret that North Idaho is growing.
Labor economists say that growth is both a blessing and a curse.
“Sometimes significant growth is painful in ways you don’t expect,” said Lisa Grigg, the North Central regional economist for the Idaho Department of Labor.
In the past five years, the five northern counties have seen a combined population increase of about 12% overall, slightly outpacing the 11% population growth statewide. Bonner and Boundary counties are two of Idaho’s four fastest-growing counties, Grigg noted, and both are also among the top 100 fastest-growing counties in the nation by percentage.
A growing population requires more infrastructure and more employees — but there’s a limit to how much the labor force can grow, especially when many newcomers to the area are retirees or approaching retirement age. In North Idaho, employers are feeling the pinch.
“Employers can’t find enough people and are getting frustrated,” Grigg said.
Even so, Grigg said, the five northern counties are outpacing the state when it comes to employment growth.
Construction is the top industry by jobs added, with more than 2,000 new jobs in the five northern counties in the last five years. The accommodation and food services industries have also added close to 2,000 jobs in the same time frame, while the health care sector has added about 1,500 jobs.
Overall, the five northern counties have added more than 12,000 jobs in the last five years.
More than 2,000 new employer accounts have opened in North Idaho in the last five years. Construction is again leading the way, with nearly 400 new construction employers added.
Grigg said most of these businesses have fewer than 10 employees.
“These are small companies, but there are a lot of them,” she said.
The same goes for professional services, such as architects, attorneys, accountants and similar work. About 300 new employer accounts have been added in the last five years.
Health care employer accounts are also growing, with about 250 cropping up within the last five years. Most of these businesses have fewer than 20 employees.
“We’re not seeing new hospitals but new clinic offices, like a physician or two with a small staff,” Grigg said.
Every industry is seeing “significant” wage growth, Grigg said. In North Idaho, the average wage was about $52,000 per year in 2023, up from about $38,000 per year in 2018.
“We’re struggling to get bodies in every industry,” Grigg said. “Wages are one method that employers have to draw in the labor force.”
With wages rising overall, the region’s housing crisis feeds into the labor shortage, creating more hurdles for employees and employers alike.
“It’s really caused a huge struggle because employers need people but people can’t find reasonable housing,” Grigg said.
Grigg said she anticipates North Idaho to continue to grow and keep pace with the rest of Idaho, but that growth may be constrained by the lack of labor force.
“This is happening quickly and your local governments and local economies are trying to adapt as best they can,” she said. “It’s not going to be easily fixed, unfortunately.”
