WASHINGTON—Lyle Beckwith, senior vice president of government relations at NACS, recently penned an op-ed in the Washington Times that questions how the U.S. economy can get people back to work in a post-pandemic climate.
“The U.S. economy finds itself in an odd contradiction. While nearly 10 million people are looking for work, businesses from across the country and in a variety of industry sectors report a shortage of willing workers. Normally, people who want work and businesses who want workers find one another, but that is not happening now,” wrote Beckwith.
Some sectors are having more trouble than others, like in-person service and hospitality sectors that include restaurants and convenience stores. There’s also a truck driver shortage, a topic covered multiple times in NACS Daily. The big question is this: Why?
“An unhealthy combination of factors seems to be driving the labor shortage. One of those factors is the fear of contracting COVID-19,” and caring for family members could also be keeping people out of the job market. All of this is being compounded by compounded by economic incentives, such as unemployment payments.
“Many unemployed people may be receiving nearly as much (or, in some cases, more) for not working than they would working. While that might not last forever, it may be keeping some people home for now, or at least until they can get vaccinated or otherwise feel less concerned about the COVID risk,” said Beckwith.
Last year around this time the Wall Street Journal reported that about half of all U.S. employees would earn more in unemployment benefits than working prior to the coronavirus pandemic shutdown. The coronavirus stimulus gave out-of-work people who filed for unemployment an extra $600 weekly on top of state benefits, which added up to about $978 a week—"sharply higher than the $377.97 average unemployment compensation in 2019,” per the U.S. Department of Labor.
Beckwith noted that the widespread difficulties businesses are having to find willing workers suggests that all these factors “are combining in a problematic way for the economy.” Labor shortages typically trigger higher wages, but under today’s circumstances it will take more people working for the economy to pick up.
So, what can businesses do? One answer may be to make more progress on vaccinationsand incentivizing current employees to get the vaccine. “Giving people confidence that life should return to its more normal patterns would clearly help. More vaccinations should also allow schools, day care centers and other services to get back to in-person operation,” said Beckwith.
Other ideas proposed during the previous Congress were the FRNT LINE Act and the AG CHAIN Act. “Both bills would have provided income and payroll tax relief for essential workers. The idea behind them was to reward people financially for getting back to work in areas such as foodservice and food and fuel transportation that all of us need to continue without interruption,” said Beckwith.
While this type of incentive program would provide a direct financial incentive to get back to work, it would also send a strong signal about the societal importance of working and doing these jobs.
“A year ago, it was commonplace for people to voice the appreciation they had for the everyday workers who were showing up to ensure shelves were stocked, gas could be found at the pump and the like. That sentiment has dissipated,” said Beckwith, adding that we need it back. “We need to be clear about the importance and dignity of work, especially in essential industries. If we don’t find a way to send that message and get people back to work, our economy will lag.”