It’s no secret there is a significant labor shortage in America at the moment and we are seeing its effects clearly here in Otsego County.
Help wanted signs are everywhere. While the problem touches most businesses, local restaurants appear to be particularly affected. Many have been forced to close multiple days per week; some have closed permanently. One local food service has become a food truck because of a lack of employees.
At the end of June, there were about 9.3 million U.S. workers on the unemployment rolls at the same time as U.S. businesses were looking to fill 9.2 million open positions.
There are those who understandably blame the extended unemployment benefits that add an additional $300 to the existing base, which in New York tops out at about $500 per week, a 60% increase that brings the weekly take to around $800 maximum. Undoubtedly, there are those who are taking full advantage of this windfall for a number of reasons, from the legitimate — fear of COVID, lack of childcare, etc. — to the questionable “why work when I’m making as much or more just staying at home?” However, there’s more to this. Federal programs have infused the economy with trillions of dollars in stimulus targeted directly to wage earners and their dependent children. This direct stimulus, along with the fact that people were likely to spend less money under lockdown conditions, resulted in a dramatic increase in personal funds throughout the economy. A good indication of where the cash ended up is in the country’s Personal Savings Rate (PSR), which is the percentage of disposable personal income. For decades, the U.S. PSR has languished below 10%, with a brief high-water mark of about 15% in the 1970s. In 2020, with the first round of stimulus checks, extended unemployment benefits and reduced spending, the PSR soared to nearly 35%, followed by later spikes of about 20% and 25% as successive rounds of federal largesse hit the streets.
People have more options now, and possibly the time to look for, or prepare for, a job they want instead of having to settle. Certainly, back to the restaurant business, there are not many waiters and waitresses, bartenders or dishwashers, for whom that job is their desired career. Now some people have time and the liberty and opportunity of continuing their education or taking advantage of job-training programs or signing up for unpaid internships. We haven’t heard news of an intern shortage.
There should be no shame in being unemployed because you don’t want to take a job you don’t want. If you have the ability to hold out, God bless you. And as understandable as it is that unemployment benefits and perceived laziness are the root cause of our labor problems, states that have ended the extended unemployment benefits have about the same labor shortages as those that have not. The problem remains, and the shortage of labor across the country is a serious matter and it is having a considerably detrimental effect on local economies.
Meanwhile, down on the southern border, and fleeing from Afghanistan, there are hundreds of thousands of men, women and children yearning to build a new, safe and prosperous life in America, where one can rise to the full height of one’s opportunity and talent. Give those hopeful masses the opportunity to have a work-visa pathway to citizenship and, just as was experienced in past waves of immigration, our country’s labor problems may rapidly disappear.