The primary driver of the impending labor shortage in developed nations is demographic change (an aging population), which has a far greater immediate impact than AI.
There is a critical and growing mismatch between the education system, which primarily prepares students for white-collar jobs, and the actual market demand for skilled trades and in-person healthcare workers.
AI will contribute to job displacement but will not cause mass unemployment in the near future, as the demand for in-person jobs that are difficult to automate remains high.
A massive societal effort in reskilling and job transition is required over the next 15 years to adapt to these structural labor market shifts.
Developed countries like the US and UK face a more acute labor shortage than Japan because they cannot leverage an increase in female labor participation to the same extent Japan has over the past 20 years.
Semafor World Economy Summit
At the Semafor World Economy summit, Deko Idekoba presented a comprehensive thesis on the global labor market. He argued that demographic decline is a more pressing issue than AI, detailed a severe shortage in skilled trades due to an educational mismatch, and predicted a 15-year period of massive reskilling. He supported his claims with data from Recruit Holdings, projecting a 20 million worker shortage in the US.
▶Demographics Over DisruptionMay 2026
Idekoba consistently argues that the aging population and declining workforce participation in developed countries are a more significant and immediate threat to the labor market than AI-driven job displacement. He attributes 80% of the projected US worker shortage to demographics, compared to just 20% from AI, framing the demographic shift as the 'way bigger impact'.
Investors should focus on sectors that provide solutions to labor shortages and demographic shifts (e.g., elder care, automation for skilled trades, immigration services) rather than being solely focused on AI's disruptive potential on the workforce.
▶The Skilled Trades ImperativeMay 2026
He highlights a severe shortage of workers for essential in-person jobs like construction, plumbing, and healthcare. This crisis is exacerbated by an education system that is misaligned with market needs and a historical wage gap that has devalued these professions compared to white-collar roles.
This points to a significant market opportunity for vocational training platforms, companies that improve the efficiency and productivity of skilled trades, and policy initiatives aimed at elevating the status and compensation of these critical roles.
▶Contrasting Global Labor ResponsesMay 2026
Idekoba contrasts Japan's relative stability in its working population, achieved by increasing female labor participation, with the faster-onset shortages in the US, UK, and Germany. He also notes the significant reliance of the US healthcare sector on immigrant labor, with one in four healthcare workers and one in five nurses being immigrants.
Analysts must consider country-specific demographic and social policies, such as immigration and female workforce integration, as key variables when forecasting economic growth and labor market health in developed nations.
▶The Lag in Corporate AdaptationMay 2026
Despite the looming labor crisis and the hype around AI, Idekoba observes that most corporate HR and talent acquisition departments are slow to adopt new technologies, using the same processes they did five years ago. He predicts a massive, multi-generational reskilling effort will be necessary over the next 15 years to cope with these changes.
There is a disconnect between C-suite discourse on AI and the operational reality within HR, suggesting a market for tools and consulting services that can bridge this implementation gap and facilitate necessary workforce transitions.