EOR Services Help Navigate U.S. Labor Shortages

You’ve been trying to fill that critical role for months. The perfect candidate finally appears—experienced, motivated, ready to start. There’s just one problem: they live in Barcelona. Or Buenos Aires. Or Bangkok.

Now what?

If you’re like most employers in 2025, this scenario is becoming painfully familiar. Seven out of ten companies can’t find the talent they need locally. That’s not a typo—the 70% U.S. labor shortage is leaving employers stuck with empty desks and unfinished projects because the right people simply aren’t there. Back in 2015, only 38% of U.S. companies had this problem. Today? It’s practically everyone.

Here’s the thing: while you’re limiting your search to a 50-mile radius, your competition is fishing in a global talent pool. They’re not smarter than you—they just figured out that the solution to the talent shortage isn’t finding more people nearby. It’s changing what “nearby” means.

This is where the game changes. Because when you can hire anywhere, that labor shortage everyone’s talking about? It starts to look a lot less scary. Let’s talk about how employer of record (EOR) services turn a local hiring crisis into a global opportunity—and why the companies solving their talent problems aren’t waiting for the shortage to end.

Factors driving the U.S. labor shortage

“Over the last two decades, job openings have largely increased, while the number of unemployed workers has decreased, ultimately leading to a labor shortage once the number of job openings in the country surpassed the number of available workers,” reports Stephanie Ferguson Melhorn, Senior Director of Workforce & International Labor Policy at the U.S. Chamber of Commerce.

Several fundamental forces drive this widening gap. Early retirement and an aging workforce lead the charge as Americans retire in record numbers, and the population over 65 grows nearly five times faster than the general population. “These retirements are contributing to the shortage because those retiring are not being readily replaced by the next generation,” Melhorn adds.

Additionally, worker expectations have shifted dramatically toward flexible arrangements and better work-life balance. “Many employees in recent years have either left work or stayed unemployed to open their own businesses,” says Melhorn. “In 2023, a record 5.5 million new business applications were filed, showing a remarkable surge of interest in entrepreneurship and worker flexibility,” she adds.

Skills mismatches compound the problem, as the pipeline of new workers entering the job market remains smaller than the number of those leaving. America’s lowest immigration levels in decades have also accelerated workforce deficits across multiple sectors.

Traditional solutions fall short of addressing the scale and speed of current needs. Reskilling programs require two to four years to produce qualified workers for many positions. Higher wages alone cannot solve fundamental supply constraints. Geographic mismatches persist as housing costs prevent workers from relocating to high-demand areas.

EOR services offer a strategic solution that bypasses these limitations entirely. These platforms enable U.S. companies to access global talent pools in a compliant and rapid manner. Rather than waiting years for domestic workforce development, organizations can tap into skilled professionals worldwide within days of identifying talent needs.

What is an EOR?

An EOR is a third-party organization that legally employs talent on behalf of another company. The EOR assumes full responsibility for all employment-related tasks, including payroll, taxes, benefits, and compliance with local labor laws. Meanwhile, the client company controls the employee’s daily work activities and management.

This is a partnership. Companies identify and select the talent they want to hire through their standard recruitment process. The EOR then steps in to handle all employment logistics by drafting compliant contracts, collecting necessary documents, and officially becoming the legal employer in that jurisdiction.

This arrangement delivers three critical advantages for expanding businesses:

Companies can hire internationally without establishing local entities or obtaining business registrations.
EORs assume liability for compliance violations rather than placing that risk on the client company.
Businesses can begin operations faster since EORs are already registered in target countries and can onboard employees immediately.

Skip the shortage and hire globally instead

Think of it this way: while you and every other company in town are fighting over the same three qualified candidates, there’s an entire world of talent just waiting. They’re not hiding—they’re just not commuting to your office.

EORs crack this whole thing open. Suddenly, you’re not bidding against 50 other companies for that one data scientist in Denver. You’ve got options in Dublin, Delhi, and Dubrovnik. Need someone who actually understands that niche technology you’re building on? They exist—probably in a time zone that’ll give you 24-hour coverage as a bonus.

Here’s what this looks like when you stop limiting yourself locally:

Facilitates access to skilled talent in global markets. Companies can hire specialized professionals in high-demand fields like software development, digital marketing, and customer service from countries with abundant talent. This approach bypasses the constraints of local talent scarcity entirely.
Mitigates regional talent bottlenecks without waiting for immigration reform. EORs enable businesses to work with international talent remotely rather than relying on complex visa processes or immigration policy changes. Companies can onboard skilled workers in their home countries within weeks instead of waiting months or years for immigration solutions.
Fills urgent roles without compromising compliance. EOR services handle all employment law requirements and regulatory compliance in each jurisdiction where talent is hired. This ensures businesses can move quickly to fill critical positions while maintaining full legal protection.
Offers flexibility to scale teams without long-term infrastructure investment. Companies can adjust workforce size based on project needs without establishing foreign entities or maintaining permanent offices. This scalability proves especially valuable for seasonal businesses or project-based work that requires rapid team expansion.

Real-world examples of U.S. labor shortages by sector

Labor shortages affect virtually every major industry across the U.S. The crisis extends far beyond entry-level positions to include highly skilled professionals and specialized roles that require years of training.

The sectors facing critical shortages include:

Tech (software engineering, data science). Technology companies struggle to find qualified developers and data scientists despite offering competitive salaries. The rapid pace of technological advancement creates demand for skills that traditional education systems cannot produce quickly enough.
Healthcare (nurses, specialized technicians). The healthcare sector faces some of the most severe shortages, with over 400,000 home health aide positions unfilled and a projected average of approximately 31,900 openings per year for nurse anesthetists, nurse midwives, and nurse practitioners through 2033. Physician shortages could reach 122,000 by 2032 as the population ages.
Manufacturing (skilled trades, machine operators). Approximately 400,000 manufacturing jobs remain unfilled, according to the Bureau of Labor Statistics. Some companies report having only one qualified candidate for every 20 open positions.
Logistics (warehouse and transport worker). One quarter of freight firms identify workforce shortages as their biggest business concern in 2025. The industry may need an additional 160,000 drivers by 2030 to meet growing demand.

To put this shortage into perspective at scale, in December 2024, the U.S. had 7.6 million job openings with insufficient local candidates to fill them. This represents a job opening rate of 4.5 percent across all industries.

How to use EOR services to access global talent

Getting started with EOR services requires a strategic approach to identify the right opportunities and establish compliant hiring processes. The following steps provide a roadmap for U.S. companies ready to tap into global talent pools:

Identify roles suitable for remote/global execution. Focus on positions that can be performed effectively from any location, such as software development, digital marketing, customer service, and data analysis. Companies should evaluate which roles require minimal physical presence and can leverage digital collaboration tools.
Choose a global EOR provider. Research the best EOR services that own their legal entities rather than relying on third-party partnerships for better service reliability. Pebl offers comprehensive EOR solutions with an established presence in key talent markets worldwide. Evaluate providers based on their security measures, employee experience quality, and compliance track record.
Onboard talent quickly and compliantly. The EOR handles all employment logistics, including drafting compliant contracts and collecting necessary documentation. Most EOR providers can generate locally compliant contracts within minutes and coordinate pre-boarding preparations to ensure swift transitions.
Manage payroll, taxes, and benefits with reduced admin burden. EORs process monthly payroll across different countries while calculating country-specific deductions and tax withholdings. The EOR maintains detailed records, including pay stubs, tax statements, and year-end forms to support compliance requirements.
Ensure legal and tax compliance across borders. EOR providers conduct thorough compliance checks before finalizing payroll to verify adherence to local labor laws and regulations. This includes compliance with minimum wage requirements, overtime calculations, and industry-specific regulations that vary significantly across jurisdictions.

Why smaller companies are winning the EOR global talent game

Startups and small-to-medium businesses (SMBs) face unique challenges when competing for scarce talent, but EOR services for startups and SMBs level the playing field by providing enterprise-level hiring capabilities without typical barriers. The core advantages for growing businesses include:

No legal entity required. Companies can hire talent in new markets without establishing local subsidiaries or navigating complex business registration processes. This removes months of legal work and allows businesses to focus on finding the right talent rather than administrative compliance.
Lower upfront investment. EOR pricing structures convert unpredictable compliance costs into predictable monthly fees. Startups avoid massive initial costs like office leases and legal fees since they pay only for what they use.
Agile hiring strategy during times of uncertainty. EORs enable companies to scale teams up or down in any location without long-term legal or financial commitments. Businesses can test new markets by placing small teams internationally and pivot quickly if conditions change.
Attain diversity goals through global representation. EORs provide direct access to international talent pools where companies can hire skilled professionals regardless of their location. This global diversity naturally increases representation across different backgrounds and perspectives that might be limited in local hiring markets.

Stop waiting for talent that isn’t coming. Start hiring where it already exists.

Pebl’s EOR solution takes care of the stuff that usually stops companies cold. Local labor laws? Handled. Payroll in multiple currencies? Done. Benefits that actually make sense in each country? We’ve got it.

The result? You get the talent you need when you need it. Your competition gets to keep posting the same job listing for another six months.

Ready to solve your talent shortage by thinking beyond borders? Let’s talk about which roles you need to fill first. We’ll show you how to have your next great hire onboarded before your competitors even know you’ve gone global.

This information does not, and is not intended to, constitute legal or tax advice and is for general informational purposes only. The intent of this document is solely to provide general and preliminary information for private use. Do not rely on it as an alternative to legal, financial, taxation, or accountancy advice from an appropriately qualified professional. The content in this guide is provided “as is,” and no representations are made that the content is error-free.