Several days ago, I went to the pastry shop that my brother manages and helped him. That was when I learned about the current situation in industries with labor shortages. Despite many customers, the endless, overwhelming workload exhausted my brother and the staff.
It meant it was easier for individuals to make a profit. Let’s discuss it more deeply.
Where to show our creativity?
Sometimes, we desire to discover new opportunities to show our individuality. Demonstrating our uniqueness provides us with an advantage and makes us feel alive.
One of our unique qualities is creativity. We are good at improving traditional methods.
In my opinion, creative opportunities currently lie in traditional local industries with manual labor that are facing labor shortages. It would be more rewarding than competitive, innovative industries.
However, we sometimes see strange phenomena in such industries.
One example is the coexistence of bankruptcy amid record profits. Despite being in similar industries, the number of bankruptcies is increasing, while many individuals and companies are making record profits.
For example, I recently saw news that livestock farmers in the U.S. suddenly experienced record-high profits, while many of them have gone bankrupt in recent years. In addition, Tyson, the largest U.S. meat processing company, is closing factories now.
Those contradictory phenomena confuse us. What is happening now in industries facing labor shortages?
One solution is to understand when the industry will hit the bottom and begin to rise. After many bankruptcies, profits suddenly increase. This perspective might show you when to prepare and become proactive in those fields.
The shift of profitable industries
In industries with labor shortages, bankruptcy and record profits can occur simultaneously. To be precise, after many bankruptcies, sudden profit improvements often happen. That shows us when to wait and when to take proactive action.
There is an order in the industries where profits improve. It is as follows:
- The most fundamental productive industries, such as agriculture, livestock farming, fisheries, and mining
- Fundamental processing industries that use the above materials directly, such as agricultural product processors, meat processors, and steel companies
- Advanced processing industries that use the processed materials, such as food processing companies and heavy industries.
- Advanced tool development industries for achieving innovation
- Innovative industries and research institutions
- (Entering a recession and returning to the top)
The current situation
Technological innovation and the economic state are closely related.
Now we are in the AI bubble economy and before the next recession. In this period, the most fundamental productive industries begin to hit bottom and rise.
One typical example is the livestock farmers in the U.S., which I mentioned above. They began to be profitable, while meat processing companies are still struggling.
In this period, many investors are trying to discover more innovative industries, while fewer people invest in foundational ones.
However, that causes a recession, which means an adjustment of investment targets.
When a recession begins, turmoil occurs not only in the financial market but also in the real economy. Although buying something fundamental now is not always the best time, history shows what kinds of events will happen soon. Learning history and looking at the current change broadly and historically enables you to understand when the industry hit bottom.
Preparing for changes
In my opinion, it would be enjoyable to experience local traditional industries with labor shortages. There are opportunities to show our creativity.
However, it will often not be highly profitable for a while. In other words, we have to wait while preparing.
In my case, although sewing is facing a severe labor shortage in my area, it is not a fundamental industry. That tells us that we cannot make a big profit in sewing until the time comes.
That awareness calmed me down and made me learn sewing without rushing. Securing a few sales channels and improving my production steadily is enough for now. I am also interested in baking pastries. Timing is also crucial for creativity.
Conclusion
That perspective shows us when the industry will hit the bottom and begin to rise.
After many bankruptcies, profits suddenly increase.
This perspective might show you when to prepare and become proactive in those fields.
Thank you for reading this article. I hope to see you in the next one.
