Consider This from NPR - Why Are So Many Businesses Struggling To Find Workers?

Episode Date: May 12, 2021

Republicans say enhanced pandemic unemployment benefits are what's keeping people out of the workforce. That could be playing a role, but the complete picture is far more complicated. NPR chief economic correspondent Scott Horsley lays out the evidence for what's really behind the struggle to find workers. Stacey Vanek Smith, host of NPR's daily economics podcast The Indicator, explains why the problem may be specific to a certain subset of the economy. More from the Indicator on that topic here. Find more episodes on Spotify or Apple Podcasts. To take a short, anonymous survey about Consider This, please visit npr.org/springsurvey. In participating regions, you'll also hear a local news segment that will help you make sense of what's going on in your community.Email us at [e-mail] more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Hey, before we get to the show, we're trying to make this podcast better, and we would love some feedback from you about how we can do that. So to help us out, you can find a short anonymous survey at npr.org slash spring survey. And that link is in our episode notes. It only takes a few minutes, and it's a big help. Again, npr.org slash spring survey. Thanks. And thanks. These days, at Dairy Queen in Bend, Oregon, if an employee calls in sick, there's no plan B. So either the managers work an extra shift, or I work an extra shift, or we just go shorthanded and hope for the best. Area manager Nikki Johnson is in charge of two Dairy Queen locations on the north and south ends of town. And lately, they've been so short on staff, they'll sometimes go drive-thru only and close the indoor part of the restaurant. I get text messages from a friend that came to try and get a burger, but they can't get inside the building.

Or I see a friend put a post on Facebook that the lobby was closed and what's going on. And it's like, oh. What's going on is that Johnson, like a lot of hiring managers around the country, does not have enough employees. It's almost like we have, it's like wage wars. One restaurant ups the minimum, then everybody else does. And the next thing you know, somebody else is beating that person because we're all trying to pull from the same pool and there's just not enough people. Starting pay at her Dairy Queen locations? $14 an hour plus medical. That's up $1 in the last year. Decent, but not a ton of money in a pricey mountain town where the median home now sells for around $600,000.

Johnson estimates she's short 12 workers at one location and six at another. We did get three applicants over the last five days, which is a big number. We've contacted all of them, but we haven't heard back from anybody just yet. Consider this. Employers say they can't find workers, but do they really mean they can't find workers at the rate they want to pay? From NPR, I'm Adi Cornish. It's Wednesday, May 12th. This message comes from NPR sponsor, Womply.

Womply is committed to helping self-employed workers and small businesses get their PPP loan. Application determines eligibility. Apply for free at W-O-M- at WOMPLY.com slash NPR. This message comes from NPR sponsor Deloitte, offering insights and strategies for solving for the complex challenges that workers, companies, and governments face as we all look to reopen and recover. Online at Deloitte.com slash US slash COVID-19. Today, it seems like everybody's got a bone to pick with the news. So what happens when somebody stops talking smack and just decides to wage all-out war? First thing you do in an evasion, you eliminate the communications of the enemy. And what happens if they win? Visit Stockton, California for a story about a revolt against the mainstream media

that's shaken up a city from NPR's Invisibilia. It's Consider This from NPR. Here's how a growing number of Republicans explain the employment situation right now. Employers want to hire more people, but they're hearing that some workers, instead of returning to low-wage service industry jobs, can make more money not working. Employers have people who come in for an appointment but don't show up for the interview. They recite the fact that they can make more money because they have the assistance at home. Those are the kind of anecdotes you hear repeated by Republican governors like Asa Hutchinson of Arkansas, who spoke to NPR this week. And their argument, also made by some business groups and Republican members of Congress,

is that the enhanced pandemic unemployment benefits are keeping people out of the workforce. What Americans and Arkansans are about is that we don't get paid when you're able-bodied for waiting at home when there are jobs to fill. To a lot of labor experts, that explanation is too simple. It just, I'm telling you, I'm so upset when they talk about these antidotes because they're not based on facts. And if those folks had ever truly worked for people who are unemployed, they know that those folks want to work. Michelle Singletary, personal finance columnist at the Washington Post, says people receiving unemployment benefits are more likely to look for work because those benefits help them afford things like a babysitter, car repair, new clothes. There is no credible studies that show that people are more

likely to not search for a job if they're getting enhanced benefits. In fact, just the opposite. The Chicago Federal Reserve found that those receiving those amped up benefits were twice as likely to look for a job than those who exhausted their benefits. Republican governors are not convinced, and some of them have moved to eliminate pandemic unemployment benefits for people in their states. That's an extra $300 a week. And those benefits were already scheduled to expire in September. Last week, Montana Governor Greg Gianforte

was the first to eliminate them early, replacing them with a one-time return-to-work bonus worth $1,200. We need unemployment as a safety net, but it shouldn't be a permanent status. That's why Gianforte was asked on Fox Business Network, what if some people are willing to work, but just not quite yet, or just not at the wages businesses are setting? What if the math isn't based on the unemployment benefits that folks are receiving,

but just that not wanting to work at the positions that are available? Well, you got to start someplace. And we do have 14,000 jobs open in Montana that we know of. President Joe Biden did feel compelled to issue a warning this week to the more than 16 million Americans who are out of work and getting help from the government. If you're receiving unemployment benefits and you're offered a suitable job, you can't refuse that job and just keep getting the unemployment benefits. Biden says he doesn't believe that's a major factor in people not returning to work. His administration points to the need for child care with some schools not fully open or families hesitant to send kids back in person. Plus, there's the fear of getting sick at work before people are fully vaccinated.

I think the people who claim Americans won't work, even if they find a good and fair opportunity, underestimate the American people. So we'll insist that the law is followed with respect to benefits. But we're not going to turn our backs on our fellow Americans. But right now, the law when it comes to unemployment benefits, it's complicated. NPR's chief economics correspondent Scott Horsley spoke about that with Mary Louise Kelly. So Biden says he doesn't think this is a huge problem. Why is he out talking about it? Some employers have been grousing for a while that they can't find enough workers at the wages they want to pay, and they say the extra $300 a week in pandemic

unemployment benefits are at least partly to blame. Those complaints got a lot louder after Friday's disappointing jobs report showing far fewer jobs added last month than a lot of people were expecting. Republicans have piled on, the Chamber of Commerce called for an end to the benefits. So the president's trying to navigate all this. The administration's also trying to address other factors that might be keeping workers on the sidelines, helping to subsidize childcare, for example, and of course, getting more people vaccinated, which should help to address workers' fear of contracting COVID on the job. And I want to circle you back to something we heard Biden say just there. He said, well, insist the law is followed. What is the law? Can you turn down a job

and still get unemployment? Biden's warning to workers about losing benefits is basically just stating the existing law. But enforcement of that law has varied over the course of the pandemic. For example, people who receive unemployment usually have to look for work and document that job search. But that requirement was relaxed for much of the last year because the government didn't want people out pounding the pavement. You know, when the pandemic was raging, they wanted the people to stay home. Andrew Stettner, who is an unemployment expert at the Century Foundation, says that is changing now as the public health outlook has improved. You're seeing additional states announce the reinstatement of work search

now that the vaccine program has moved forward and their economies are reopening. Another example, Mary Louise, when President Biden first came into office, that the vaccine program has moved forward and their economies are reopening. Another example, Mary Louise, when President Biden first came into office, he signed an order making it clear workers could turn down a job that might jeopardize their health without losing unemployment benefits. But the definition of a job that puts someone's health in jeopardy is evolving as the threat of the pandemic changes. So many complications there. It sounds like we will be hearing this debate play out over the next few months. Bottom line, what evidence will people on both sides of this marshal to support the point that benefits are or are not keeping people out of the workforce?

The Chamber of Commerce estimates about one in four unemployed workers is getting more in unemployment than they did when they were working. So it's not unreasonable to think some people would rather not go back to work. But it doesn't seem to be that simple. For example, lots of people went back to work last summer, even though the government was paying twice as much in extra jobless benefits at that time. Benefits in Alabama are more generous than those in Louisiana, but more people have gone back to work in Alabama. So the picture's really complicated. And finally, worker advocates say if extra benefits do give workers a little more breathing room, a little more time to wait for the right job to go back to, well, that, they say, is a good thing, not a bad thing.

NPR's chief economics correspondent, Scott Horsley. Some employers are bumping up wages in an effort to lure more employees back to the labor force. And that's not all they're doing. You know, you would say desperate times call for desperate measures. There's a lot of competition out there. George Goldhoff runs Hard Rock Casino in Cincinnati. He got so desperate to find new workers, he started offering cash bonuses for different jobs, up to $4,000 for table game dealers. I'll walk by a Dunkin' Donuts on my way to work and they have $300 signing bonuses. So this is not something that is unusual.

George Goldhoff spoke to NPR's Daily Economics podcast, The Indicator, which looked into those one-time bonuses and why businesses are struggling to hire right now. Host Stacey Vanek-Smith picks up the story from here. This is going on all across the country right now. A lot of companies are desperate for workers, and some of them have started offering these big perks. Taco Bell, Chipotle, and Whataburger are all expanding their benefits and raising pay. A McDonald's in Tampa was advertising 50 bucks if you would just show up for a job interview. Overall, 40 percent of restaurants across the country say they are understaffed right now. I think there's a portion of folks that just would rather be on government assistance.

George says that Hard Rock will reach out to thousands of job seekers and only hear back from a handful of them. And even the people who do interview, he says, will often not even respond to a job offer. We'll reach back out to them and they said, well, I'm required to apply to ensure that I get government assistance, but that doesn't mean I have to have an interview. Economist Aaron Dubé has actually studied this issue.

He examined the period of time last year when those extra unemployment benefits were not being offered, between the months of September and December. And he looked to see if job searches picked back up once the extra unemployment insurance expired. There was very little, if any, evidence that this job recovery that we're seeing right now, that's being held back in any measurable way by the unemployment benefits. Aaron thinks part of the problem that businesses like Hard Rock and McDonald's are having is actually an industry issue. He points out that the worker shortage is very concentrated in the food service and restaurant industries. Some workers have moved on to other opportunities and other places.

If you look at Amazon or Costco paying $15 or $16 minimum wages. Warehouse workers, yeah. Warehouse workers. And as Costco said, their're $16 in ways. They have no problem in getting many more applicants than they have vacancies. Daniel Zhao is a senior economist at Glassdoor, an online job search site. He says when he first heard about companies offering cash bonuses to people for taking a job, he was really surprised. In my mind, that's a pretty extreme example of an employer who is trying really hard to get more people in the door. The question of whether this is a long-term issue or something that's more temporary is a different story. So I think that part of the reason you're seeing a lot of employers rely on these bonuses is because they represent

a one-time or temporary increase in pay. And that doesn't necessarily commit them to a long-term increase in wages. If the worker shortages continue for restaurants, Daniel says, that will most certainly push wages up. In fact, wages did rise last month. And Daniel says if the worker shortage is more than just a blip,

we will see those wages continue to rise. That's Stacey Vanek-Smith, host of NPR's daily economics podcast, The Indicator. And that was an excerpt from a recent episode of theirs all about the employment situation right now. Links to that and more of their episodes on Spotify or Apple Podcasts are in our episode notes. And just a reminder, we're asking for some feedback on this podcast from you. To help us out, visit the link also in our episode notes to take a short anonymous survey. It's Consider This from NPR. I'm Adi Cornish.