A U.S. jobs report on May 7 showed job growth below expectations in April, leading the pro-business U.S. Chamber of Commerce to seek a quick remedy — end the $300 per week federal supplemental unemployment benefit.
“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” stated Neil Bradley, U.S. Chamber of Commerce executive vice president and chief policy officer. “Based on the Chamber’s analysis, the $300 benefit results in approximately one in four recipients taking home more in unemployment than they earned working.”
Are people not working because they make too much on unemployment?
One North Bay economist says the data isn’t there yet, but there’s “little doubt” that some people are making that choice.
“It's one of the key questions that we are struggling to answer as economists,” said Robert Eyler, Ph.D., dean of the School of Extended and International Education and a professor of economics at Sonoma State University. “There’s a combination of a bunch of different factors at once that could be at play, but there’s little doubt that the enhanced and extended unemployment insurance benefits have some effect on what's going on regionally.”
Among those factors are people who previously worked in low-wage jobs and are currently bringing home more money on unemployment than when they were employed; people who face childcare issues at home; and businesses that aren’t willing to increase wages to attract their workers back, Eyler said.
“When the U.S. Chamber of Commerce is arguing this, they're arguing it from the perspective of an entire country's worth of wages,” Eyler said, adding that the North Bay region’s wages are generally higher, led by Marin County. “But the $300 a week, regardless, could easily be keeping a certain subset of people from going back to work. We just don't know with precision if that's true.”
Peter Rumble, CEO of the Santa Rosa Metro Chamber, said he thinks there’s anecdotal evidence of people not wanting to come back to their jobs right away, but that it’s not at the level that’s creating significant challenges and problems for employers.
“My take would be that it is far better for people to be able to stay in their homes and feed their families with the extra support,” Rumble said. “I think the positive impact of these increased benefits far outweighs the negative benefit, and I don't believe that it is the cause of the worker shortage right now or hiring difficulties. I think that's attributable to other things.”
Rumble pointed to legislation Gov. Gavin Newsom signed on April 16 that requires employers in the hospitality and business services industries for the next three years to offer new positions to qualified former employees laid off due to COVID-19.
“This goes to the hiring practices, particularly in the hospitality industry, adding many weeks to the process to try to hire back people,” Rumble said, “really solving a problem that doesn't actually exist, where hotels are already starving for employees.”
For some area staffing firms, the extended unemployment insurance benefit is necessary, yet problematic.
“We are still under COVID-19 restrictions and, as such, we fully appreciate and support the bridge the $300/week provides people in California,” said Chandra Pappas, executive vice president of Sonoma-based Nelson Staffing. “On the other hand, our staffing and recruiting teams have more job opportunities available than we have candidates.”
Nelson also has had clients state they’ve unsuccessfully tried to bring back furloughed employees, and believe the $300 enhanced weekly benefit is a big factor as to why, Pappas said.
“We do see this as a growing theme when we confirm candidates’ availability and interest in temporary positions,” Pappas said. “To counter this trend, we are seeing some companies respond by increasing the hourly rate.”
Nicole Serres, president of Petaluma-based Star Staffing, said hiring is a top challenge for employers and it will continue to get even harder to hire people.
“Indeed, the largest job board, reported a decline in application conversions since stimulus checks were announced,” Serres said, explaining that application conversions represent completed applications.
“The top two reasons we are hearing and seeing for people not coming back to work as expected is federal aid and still the fear of getting COVID, even with accelerating vaccinations,” Serres said. “For federal aid, the contributing factors are the stimulus checks, unemployment extension plus boost, and health care insurance subsidies.”
The unemployment extension from March 15 to Sept. 4 is already impacting employers throughout California, Serres said. The total package, she noted, could be a weekly benefit of $604, when combining an average weekly benefit of $304 plus the $300 boost.
“This means someone on unemployment could be averaging $15.10/hour,” Serres said. “Simply put, many are making more on unemployment when you factor in transportation, lunches and childcare.”
For Eyler’s part, he thinks there’s a chance the U.S. Chamber of Commerce could be successful in its bid for the federal government to terminate the $300 weekly unemployment enhancement benefit.
“I don’t think it would be from business pressure as much as what might be considered to be economic prudence,” Eyler said. “If the labor market is recovering faster than you expected, then the original reasons why you gave the enhancements may not be there anymore.”
Cheryl Sarfaty covers tourism, hospitality, health care and education. She previously worked for a Gannett daily newspaper in New Jersey and NJBIZ, the state’s business journal. Cheryl has freelanced for business journals in Sacramento, Silicon Valley, San Francisco and Lehigh Valley, Pennsylvania. She has a bachelor’s degree in journalism from California State University, Northridge. Reach her at cheryl.sarfaty@busjrnl.com or 707-521-4259.
The Link LonkMay 15, 2021 at 02:06AM
https://ift.tt/3htLS1o
Grappling with employees who refuse to return to work - North Bay Business Journal
https://ift.tt/2VuKK1x
Work
No comments:
Post a Comment