We are living through a time of economic contradictions, with the world of business and the lives of workers disrupted by the aftershocks of the pandemic in ways that we are struggling to understand.
Recent headlines in the News-Post reflect this topsy-turvy situation: “Help Wanted,” “COVID safety net ending” and “... poverty rates could rise.”
According to the federal government, 8.4 million potential workers are unemployed, while businesses say they have 10.9 million job openings. If this were simple math instead of real life, that would seem to be an easy problem to solve. But it is not.
Frederick County businesses, including restaurants and retailers, have been forced to cut back on operations, eliminating days and reducing the hours they are open because they cannot find enough staff.
“It’s everywhere. And it’s in every sector,” Rick Weldon, president of the Frederick County Chamber of Commerce, told News-Post reporter Jillian Atelsek.
Potential workers have been holding back for many reasons. Some were receiving more in enhanced unemployment benefits than they were paid in their old jobs. Others are rethinking their options and looking for new jobs in different sectors of the economy. And still others are fearful to take any job where they might be exposed to COVID-19 and its deadly delta variant.
As Vox, an online news site, recently wrote: “The millions of jobs available aren’t necessarily millions of jobs people want.”
Vox quoted Shelly Steward, director of the Future of Work Initiative at the Aspen Institute, who explained: “A lot of what people are seeing are low-paying jobs with unpredictable or not-worker-friendly scheduling practices, that don’t come with benefits, don’t come with long-term stability. And those are not the types of jobs that any worker is eager to take on.”
Hiring was surprisingly weak in August, with employers adding just 235,000 jobs, according to the Labor Department. Economists put most of the blame on the impact of the delta variant, which caused a huge increase in COVID cases during the late summer.
“The delta variant has taken a bigger toll on the job market than many of us had hoped,” Sarah House, a senior economist at Wells Fargo, told The Associated Press. “It’s going to take workers longer to come back to the labor market than we expected.”
According to the jobs report, hiring was the weakest in the sectors of the economy that require face-to-face contact with the public — restaurants, hotels and retailers.
The enhanced federal unemployment benefits that sustained many workers who lost their jobs because of the pandemic have come to an end. The stimulus payments that went to almost every family are long past.
That generous federal aid, intended to stimulate the economy and prevent a general depression, supported living standards and in some cases raised them. The Urban Institute estimated that Maryland had an 18.6 percent poverty rate prior to the pandemic, but it said benefit programs reduced the rate to a projected 6.3 percent. An estimated 729,000 Marylanders stayed out of poverty.
With the end of those programs, it seems as if workers should be shrugging their shoulders and taking on work, even if they don’t like it. But it has not worked that way so far, even in several states where the unemployment benefits were ended early.
So, we wait, to see what the new world of work and business will hold. Facing a slide back into poverty, we would expect workers to return, even to jobs that they do not love. And we would expect that businesses desperate for workers will improve the attractiveness of jobs by increasing wages and improving conditions to get more candidates.
That is what would have happened in the past. But this is a different time, and our expectations may or may not be met. The next few months should tell.