Blue Collar Comeback
The Artemis Fund believes technology can create prosperity for all, but it’s not possible without diverse perspectives. Artemis leads seed rounds for diverse tech founders with wild ambitions in fintech, commerce, and care building the economy of the future.
Blue-collar work is making a comeback. Blue-collar jobs include manual or physical labor typically outside of an office environment and may require special skills but not a four year college degree. Due to the rise of four year college degrees and white-collar tech jobs, this essential work became seemingly less attractive and prestigious as a career path. The supply dropped as younger generations did not want to do this work. The baby boomer generation that did most of this work and owns most blue collar businesses is retiring. As a result of these generational trends, the impact of COVID, and a renewed focus on federal infrastructure investment, demand for this essential labor has risen, opportunities are plentiful, and companies are offering six-figure salaries and attractive benefits.
Covid Reputation Shift
Like with many aspects of work and life, the pandemic drastically shifted how Americans view blue-collar work. These workers were in most cases deemed “essential” and faced the pandemic’s risks head-on, leading to a broader recognition that these workers deserved better pay and more respect. A survey conducted in late 2021 found that 67% of blue-collar workers believed the pandemic changed societal views on their jobs, and 75% of white-collar workers agreed. Additionally, 60% of blue-collar workers felt their jobs were more respected than a decade ago. About 42% of survey participants believe there will be more jobs available in their field in the next 10 years, up from 35% who thought similarly in a 2018 survey.
Blue collar workers are an essential component of federal investment in infrastructure for economic growth and competitiveness. In the next 9 years alone, 3.8M manufacturing jobs are projected to be created. Nearly 2M of these jobs are projected to be vacant in 2033 due to a skill gap in the US workforce.
Workforce Trends
Since April 2020, blue-collar sectors like construction, manufacturing, and transportation have added 4.5 million jobs, compared to 4.1 million in professional services and information. The supply of skilled labor continues to increase, with vocational education enrollment surging by 17.5% to 779K from 2023 to 2024, compared to a 3.4% increase in overall institutional enrollment. This trend is partly driven by greater awareness of blue-collar professions through social media and the rising cost of a four year degree.
In the past year, new hires in construction had a median salary of $48K, outpacing the $39K median salary in professional services. Construction and mining wages rose by 6.3% year-over-year as of March, surpassing the overall wage growth of 5.2%.
Gen Z makes up a significant portion of new hires. For example, the number of carpenters in the U.S. has grown over the past decade, while their median age fell from 42.2 to 40.9. The same trend is seen among electricians, whose ranks grew by 229K workers, even as their median age fell by 2.9 years. Other skilled trade occupations, like plumbing and HVAC, have also seen a trend toward younger workers.
Going Digital
In an attempt to attract Gen Z talent, savvy companies are turning to social media, specifically TikTok and Instagram, to expose the benefits of blue collar work to millions of viewers. Take a look:
- The hashtag #bluecollar drew 500K posts in the first four months of this year, up 64% over the same period in 2023.
- Posts hashtagged #electrician increased 77% over the same time, with #constructionworker and #mechanic showing similar jumps.
- Blue-collar influencers are also on the rise, like Lexis Czumak-Abreu, a 27-year-old woman from a family of electricians. With 2.2M followers across TikTok, Instagram, and Facebook, she makes $200K per year from clicks and brand deals.
- Pfister Faucets spent $2 million to produce a YouTube documentary series, now in its fifth season, highlighting the lives of plumbers around the country.
Generational Wealth Transfer
Beyond blue collar employment, younger generations also see an opportunity for building wealth and independence in blue collar businesses. Owning a small business is starting to invoke a cultural “cool-factor.” For example, Contrarian Thinking Small Business Report highlights MBAs opting to buy small businesses versus pursuing prestigious consulting roles, and google searches for “buy a business” have been steadily increasing since 2020. There has simultaneously been a rise of media personalities and podcasts focused on small business acquisitions, from Codie Sanchez with 500K followers on X, to Acquiring Minds, and dozens of other podcasts.
Baby boomer small business owners are retiring in droves, and there is growing demand to purchase these businesses, funding these retiree’s retirement funds and creating generational wealth. According to BizBuySell, 75% of business brokers surveyed expect more owners to sell their business in 2024 than in 2023.
VC Blue Collar Funding
Many blue-collar industries have been overlooked by VC backed technology companies who typically focus on selling B2B SaaS to enterprises. While blue-collar workers have experienced a revolution in their personal technology, their work environments have not kept pace. The trend of vertical SaaS is increasing the adoption of tech and growth opportunities for these industries, their owners, and their employees.
We are seeing more funds building a thesis around the opportunity to invest in traditionally “unsexy” industries. As the CHIPS and Science Act of 2022 brings attention to onshoring, we see a local need for tooling to ensure our economy can meet manufacturing demand. Investments are booming in green innovation, clean tech, infrastructure, and defense, creating jobs that will continue to fuel the blue-collar economy. Some companies addressing opportunities at the intersection of blue-collar economy and the labor market include:
Recruiting & ATS
- LANDED ($7M raised) is connecting skilled blue-collar workers to job opportunities.
- Grayscale ($7.5M raised) & Paradox ($253M raised) offer conversational AI, candidate communication, and ATS options that make the hiring process more efficient than ever for high-volume hiring managers and candidates.
- Reelist enables employers to proactively recruit passive & active talent via an automated social media hiring platform.
Talent Retention & Benefits
- WorkTorch helps employers retain their employees and find career fulfillment through our engagement and internal mobility tools.
- Penelope ($5M raised) provides streamlined 401(k) plans to make retirement options simple, affordable, and easy to manage for businesses of any size.
Generational Business Transfer
- Baton Market and Succession Matching are marketplaces to buy and sell small businesses, creating financial opportunity for retiring business owners and the acquirers of the businesses.
Door-to-Door Sales Enablement
- Gamify offers field sales tools for sales reps to manage their in-person sales processes and drive revenue.
Fintech
- Bonside provides financing tailored to brick and mortar businesses.
- Finli ($9.5M raised) offers accessible money management tools for small business owners, including invoicing, payments, and inventory management.
Blue-collar work is becoming more attractive and respected, driven by social media, economic shifts, and changing societal views. This trend presents new opportunities and challenges in recruitment, especially for engaging tech-savvy Gen Z. The Artemis Fund is diving into these trends, and wants to meet ambitious founders at the forefront of the blue-collar economy.
Learn more about the companies in our portfolio on our website. If you’re a founder innovating in fintech, commerce, or care, pitch us here!
