A December 2025 study on workforce shortages reveals a growing disconnect between open jobs and available skills across the United States—and for veterans transitioning out of the military, the findings highlight both a challenge and a significant opportunity.
The research, conducted by Affordable Contractors Insurance, examined labor market conditions in all 50 states to determine where employers are struggling most to hire qualified workers. Factors included the number of residents lacking basic digital skills, the volume of unfilled jobs, the percentage of openings requiring skills the local workforce does not have, occupational licensing restrictions, and how long it takes to bring new hires onboard.
For veterans preparing to leave uniformed service (or those already navigating the civilian workforce) these shortages signal where demand is strongest and where targeted reskilling can open doors.
Texas leads the nation in workforce gaps
Texas ranks first in the nation for a lack of skilled workers, making it both one of the most challenging and potentially rewarding states for veterans seeking civilian employment. More than 583,000 jobs remain open statewide, while nearly 310,000 residents lack foundational digital skills to fill those jobs. Roughly 76% of open positions require abilities employers say applicants do not have.
Texas’s Data
- People lacking digital skills: 309,818
- Job openings: 583,209
- Job openings requiring unmet skills: 76%
- Population with bachelor’s degree: 33.1%
- Time-to-employment index (in months): 6.72
For veterans, this gap of 273,391 between the first two numbers can be an advantage. Military experience often includes structured training, technical exposure, and familiarity with systems and procedures – traits many employers are struggling to find.
However, stiff occupational licensing rules in Texas remain a hurdle. With higher regulatory barriers to entering certain professions, veterans may need to take extra steps to translate military experience into civilian credentials. Even so, the demand remains strong, particularly for those willing to pursue short-term certifications or technical training.
High-demand states aren’t always easy transitions
California and New York follow closely behind Texas, each with hundreds of thousands of unfilled jobs. In California alone, more than 640,000 positions are open, yet nearly three-quarters of those openings require skills the local workforce does not currently possess. New York faces a similar mismatch, with employers reporting that roughly 77% of openings require unmet skills.
California’s Data
- People lacking digital skills: 502,487
- Job openings: 642,170
- Job openings requiring unmet skills: 73.1%
- Population with bachelor’s degree: 36.5%
- Time-to-employment index (in months): 3.52
As the data shows, in California there are 139,683 more job openings then there are people qualified to fill them.
New York’s Data
- People lacking digital skills: 224,985
- Job openings: 359,136
- Job openings requiring unmet skills: 77.3%
- Population with bachelor’s degree: 39.6%
- Time-to-employment index (in months): 2.99
New York is much the same. They have 134,151 more job openings then they have people qualified to fill them.
Despite higher education levels in both states (36.5% and 39.6%, respectively), many employers still struggle to find candidates with practical, job-ready experience. Veterans with leadership backgrounds, technical specialties, or security-related experience may find strong demand, but should also be prepared for longer hiring timelines and additional credentialing requirements, particularly in regulated fields.
Licensing barriers matter for veterans
Massachusetts highlights an issue many veterans encounter during transition: licensing and credential transfer. While the state has one of the most educated populations in the country at 46.6%, it also enforces some of the strictest occupational licensing requirements. This makes it difficult for workers, including veterans, to move quickly into new careers, even when they already possess relevant experience.
For veterans, this reinforces the importance of researching state licensing policies before relocating or selecting a post-service career path. Some states recognize military training more readily than others, which can significantly affect how fast veterans can reenter the workforce.
Massachusetts’s Data
- People lacking digital skills: 66,448
- Job openings: 185,385
- Job openings requiring unmet skills: 79.8%
- Population with bachelor’s degree: 46.6%
- Time-to-employment index (in months): 1.69
Colorado and other high-growth markets
Colorado rounds out the top five states facing worker shortages. With more than 130,000 open jobs and over three-quarters requiring skills employers can’t find locally, the state reflects a broader national trend: high-growth economies often outpace their available talent pools.
Colorado’s Data
- People lacking digital skills: 65,918
- Job openings: 136,119
- Job openings requiring unmet skills: 77.2%
- Population with bachelor’s degree: 44.7%
- Time-to-employment index (in months): 3.53
Veterans who invest in digital literacy, technical certifications, or hybrid skill sets, combining leadership with technology, may find themselves well positioned in these markets.
Why digital skills matter after the military
Sean O’Keefe, CEO and founder of Affordable Contractors Insurance, points to digital skills as the defining issue behind the shortages.
“The biggest problem is how many people lack basic digital skills,” O’Keefe said. “Many relied on manual labor throughout their careers, but automation keeps replacing those jobs. In a few years, there simply won’t be many roles left that don’t require computers or software.”
For veterans, this reality underscores the value of using transition benefits wisely. Programs such as the GI Bill, SkillBridge, and approved certification pathways can help bridge the digital skills gap and turn labor shortages into long-term stability in post-military careers.
What this means for transitioning veterans
Skilled worker shortages aren’t just an economic problem – they’re a roadmap to opportunity. States struggling to hire are actively searching for disciplined, trainable, and mission-focused workers. Veterans already bring many of those qualities to the table and can ease the skilled worker shortage.
By pairing military experience with in-demand digital or technical skills, veterans can position themselves where demand is highest, competition is lower, and long-term growth is strongest. In a labor market defined by shortages, the right preparation can turn transition into opportunity.
Note: All Data Courtesy of Affordable Contractors Insurance
