I got it now. It was actually the end, not the beginning, of a round, and "You must take an action" meant deciding whether to do a conversion (e.g. turn a veggie into food) or use a ruby, NOT using a dwarf to take an action. What I had to do was click on "Pass" then click "Confirm" which does make it seem like I am going to skip a turn. But happily, it then tells you to "place a dwarf".
It is actually the issue in
https://boardgamearena.com/bug?id=77084 and I agree with user jgpaladin that it is a UX thing. Unfortunately, the developer doesn't seem to agree even though it seems to have tripped up a number of users for the past year. "Choosing an action is not the same as placing a dwarf on an action space" is apparently clear enough.
However, the timing is also strange: why does it ask me to "Choose an action" (do a conversion or use a ruby) after I and all of the other players have already finished our turns and done all our harvest stuff before it lets me take the first action of the next round?