The Great Labor Shortage Debate

J

JimBob1952

Senior Member
Lots of employers are complaining about being unable to hire needed workers. Some of them cite the $300 weekly supplemental unemployment benefit as a disincentive for people to work.

Others say that's nonsense, that people can't work because they have to stay home with their kids (no schools) or because the jobs they left are lousy anyway.

What's your take? Will everybody go back to work once the benefits run out? Or is this something more deep-seated?

May figures come out tomorrow so it will be interesting to see where we stand.

This is a pretty objective view:

https://www.businessinsider.com/une...ng-to-the-labor-force-jobless-benefits-2021-4
 

I think that it is a factor but I also believe that people will go back for higher wages than they were getting pre-pandemic.

Bank of America announced recently that they will gradually increase the wages of the lowest-paid employees to $25.00/hour by 2025. They are also encouraging major business partners to adopt similar increases.

IMO this will kick off a round of price increases to support increased wages and soak up the additional buying power of entry-level workers. It also pulls established middle-class workers closer to the bottom unless similar increases are phased in at all levels.

The folks that will be hit the hardest will be senior citizens that rely on Social Security for the bulk of their retirement income.

We'll see!
 
Aunt Bea said:
I think that it is a factor but I also believe that people will go back for higher wages than they were getting pre-pandemic.

Bank of America announced recently that they will gradually increase the wages of the lowest-paid employees to $25.00/hour by 2025. They are also encouraging major business partners to adopt similar increases.

IMO this will kick off a round of price increases to support increased wages and soak up the additional buying power of entry-level workers. It also pulls established middle-class workers closer to the bottom unless similar increases are phased in at all levels.

The folks that will be hit the hardest will be senior citizens that rely on Social Security for the bulk of their retirement income.

We'll see!
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You've hit on some really good points -- there are always unintended results, even of something desirable like wage increases.
 
People are forgetting that in many cases schools are not completly open. The schools in my area talk about being "open' but it's only two hours a day. This saddles parents with full time day care costs. For many parents, it's just not worth going back to work if they have to give 50%+ of the earnings to the daycare. Once schools are fully back in session I think we will see more people in the workforce. The other things is many employers simply don't want to pay enough to make working worthwhile. Supply and Demand applies to wages as well as it applying to goods and services. Pay more!
 
Virtually all of the small business stores in our area have Help Wanted signs on their doors/windows. This pandemic, and the stimulus and unemployment payments have made it quite impractical for workers to accept the traditionally lower wages. Ultimately, wages are going to have to increase and consumers will have to pay more, or those living below the poverty levels will continue to increase....which is Not good for anyone.
 
There was a news story here on tv about a local restaurant trying to reopen and cannot find workers. They are going to offer bonuses to attract help. There are several fast food places here on the street where I live that are short of workers. A friend of mine brings me a breakfast sandwich when he gets his and some of the places were not open at the designated time because the workers did not show up. He called the number on the door to ask about it and the owner was very upset and said he could not find people to work any more.
I remember when I was trying to raise two girls by myself while working two jobs and I was grateful for any work I could get.
 
It is similar here in the UK, there is a shortage of staff,
at the beginning of the pandemic, most foreign workers
went home.

Now there are shortages of bar staff, restaurant staff and
vegetable pickers, where the workers had accommodation.

The employers of these foreign workers have only themselves
to blame for shortage as they paid very low wages, or charged
high prices for a room and meals, so low were these wages that
the British refuse to take the jobs, they are getting more from
benefits.

Some publicans were interviewed on the TV News last night and
they say that they can't keep open late because of no staff.

Mike.
 
Daughter is Director of Risk Management for a large corporation. At her location they employ ~1,200 people. Gave 98% of them laptops and let them work from home during the pandemic. Lots of issues with the work-from-home and, now, trying to get them back on-site.

A person begins to work from home for the same wages they were paid on site. Suddenly, they could keep their kids home and not have childcare expenses. No cost for gasoline and auto upkeep when commuting. Wear their sweats all day. They don't want to... won't... go back for the same wages when they would have to once again pay for child care, etc.

Do they offer more money to come back? The labor pool is decimated so there's no one to take their places if they quit. The work-from-home has had a plethora of warnings and firings. People don't understand they have to actually work and not be playing with their kids, doing laundry, starting childcare businesses in their home, etc. when on the clock!!

She feels the 'carrot' of high unemployment benefits puts the employee in a position to negotiate for higher wages. Yet, she also feels that many could be offered higher wages and they still won't come back and give up what they have learned to enjoy about working from home.

Really glad I'm retired and don't have to deal with today's labor market.
 
The good news this morning is that jobs are up by 559,000 and unemployment is down to 5.8 percent. One factor I didn't mention is that more and more people feel physically safe about going back to work.

BLS-Labor Statistics
@BLS_gov
Payroll employment rises by 559,000 in May; unemployment rate declines to 5.8% http://go.usa.gov/vrK #JobsReport #BLSdata
 
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In my working years, if I was laid off and collecting unemployment compensation, it was like a payed vacation, and if it was in the summer, better yet. I think that a lot of people are not in love with their jobs and are happy to receive free money. Eventually though the gravy train should end.

Unfortunately, these illegal immigrant coming over the border will be happy to take those jobs at half the going wage which is what open borders is about anyway.
 
Chet said:
In my working years, if I was laid off and collecting unemployment compensation, it was like a payed vacation, and if it was in the summer, better yet. I think that a lot of people are not in love with their jobs and are happy to receive free money. Eventually though the gravy train should end.

Unfortunately, these illegal immigrant coming over the border will be happy to take those jobs at half the going wage which is what open borders is about anyway.
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A lot of these illegal residents aren't going to find a job. Without a SS number, you're kind of screwed, unless they can get a job with a tax evader employer (and there are plenty of those) that is willing to pay under the table. Maybe the government is also supplying free SS numbers to these criminals. If you think I'm not liking what's going on at the border, you would be correct. You can hate me, just don't kill me
 
Chet said:
In my working years, if I was laid off and collecting unemployment compensation, it was like a payed vacation, and if it was in the summer, better yet. I think that a lot of people are not in love with their jobs and are happy to receive free money. Eventually though the gravy train should end.

Unfortunately, these illegal immigrant coming over the border will be happy to take those jobs at half the going wage which is what open borders is about anyway.
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Prosecute their employers (something the Justice Department refused to do under Bush and Trump) and the problem will not exist.
 
When I was working out of the Gettysburg Barracks, I would from time to time drive through the battlefield. While there, I would often stop and read the many historical markers that dressed the battlefield. I enjoyed it so much that I had to read as much as I could find on the battles that took place in G’burg.
 
'But a recent poll of 1,000 unemployed workers by CNBC and Morning Consult told a different story. Respondents said the trickle-down effect of job openings had not reached them — at least, not yet. Some 87% said they had not received job offers in the last six months.

What’s more, 65% of those surveyed said unemployment benefits were not a factor in their rejecting a job. Instead, they cited too-low salary (36%), concerns about COVID-19 (35%) and the need to care for family (31%). In fact, 76% of those offered a new position said the proposed wages were lower than their prior job."

https://www.marketwatch.com/story/i...s-why-are-people-turning-down-jobs-2021-05-21

Employers needs to make it attractive to fill jobs.
 
The current "level" of poverty, according to HHS, is about $26K/yr., for a family of four. In most States, the minimum wage is about $10/hour, which breaks down to less than $20K/yr, That means that anyone making minimum wage is officially living in poverty, The government has stipulated that the minimum wage will be increased to $15/hour, by 2025, which will be about $28K/yr. However, if inflation continues at its historic pace, those on minimum wage will Still be living under the poverty standards, in 2025.

A retiree, who is Debt Free, and in good health, and isn't paying hundreds of dollars per month to rent an apartment could probably meet their basic needs on $30k/year, IF they maintain a fairly frugal lifestyle. However, for a young couple trying to raise a family, and saddled with house payments, etc., anything less than $50K/year, probably barely meets their needs.

Meanwhile, we have huge numbers of millionaires, and billionaires, and corporations who are paying far less than their fair share to help bring our people out of poverty, The ONLY vital expense for those is their generous political campaign donations to maintain the "status quo". Meanwhile, the "disparity in wealth" continues to grow more and more with every passing year.

I am Not optimistic about the future of the nation,
 
I don't know specifically what the main contributing factor is in the labor shortage. Perhaps in the year plus of quarantine there are numbers of people who have found alternative means of earning money, that doesn't currently fit in the labor statistics.
 
An “advantage” to living on minimum wage is most social services programs are available.
What I really don’t understand is even if you’re making more on unemployment what about health insurance?
Cobra is extremely expensive and with a young family one trip to the ER could bankrupt someone.
 
They need to change their "Ads", instead of Barman/maid, or
Shop Assistant, etc., they should be asking for "Trainee Manager,
Supervisor", anything with a better sounding name will appeal
to younger workers,

Mike.
 
Don M. said:
The current "level" of poverty, according to HHS, is about $26K/yr., for a family of four. In most States, the minimum wage is about $10/hour, which breaks down to less than $20K/yr, That means that anyone making minimum wage is officially living in poverty, The government has stipulated that the minimum wage will be increased to $15/hour, by 2025, which will be about $28K/yr. However, if inflation continues at its historic pace, those on minimum wage will Still be living under the poverty standards, in 2025.

A retiree, who is Debt Free, and in good health, and isn't paying hundreds of dollars per month to rent an apartment could probably meet their basic needs on $30k/year, IF they maintain a fairly frugal lifestyle. However, for a young couple trying to raise a family, and saddled with house payments, etc., anything less than $50K/year, probably barely meets their needs.

Meanwhile, we have huge numbers of millionaires, and billionaires, and corporations who are paying far less than their fair share to help bring our people out of poverty, The ONLY vital expense for those is their generous political campaign donations to maintain the "status quo". Meanwhile, the "disparity in wealth" continues to grow more and more with every passing year.

I am Not optimistic about the future of the nation,
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The poverty level was 10.5 percent in 2019, the last year for which figures are available. It went down for five consecutive years from 2014 to 2019. No doubt it increased in 2020 due to the pandemic, but it's certainly dropping again.

Poverty statistics ignore wealth transfers. The poor family of four making $25,000 is eligible for food stamps, housing subsidies, earned income tax credit, Medicaid and many other benefits. It still sucks to be poor, but not as badly as you might think.

I'm not optimistic about the future of the nation, either, but for other reasons.

https://www.benefits.gov/benefit-finder
 
JimBob1952 said:
The poor family of four making $25,000 is eligible for food stamps, housing subsidies, earned income tax credit, Medicaid and many other benefits.
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Eligibility for food stamps and Medicaid is contingent is governed by state laws. In many states if you have more than $2,000 in your bank account or other liquid assets you do not qualify for these things.
 

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