Christian D’Agostino, executive chef and owner of Tavern on Main in Wakefield and East Greenwich, as well as the soon-to-open Coastal Cabin on Boston Neck Road in Narragansett, said a shortage of help is seriously affecting his businesses.
“A month ago I was literally getting zero applications, now I’m getting some,” he said, but is still having trouble finding waiters, waitresses and managers.
Like other business owners, he pointed to the extra federal unemployment bonus, but also a post-pandemic environment that finds many workers left the industry due to shutdowns and no work for the last year, they said.
Businesses in South County are facing a shortage of finding workers for the summer and some are pinning hopes on a new proposed state law that may lure unemployed workers back to jobs. If not, another summer could cripple these businesses dependent on serving tourists and taking in tourism dollars to stay afloat.
In essence, say many business owners, the problem has several causes, but chiefly the $300 federally-funded unemployment bonus enabling many to make more money staying home than earning a weekly salary at work.
“There are many businesses struggling because of this shortage, with some owners themselves working in the kitchen because they don’t have anyone else. There’s no one taking the jobs,” said Joe Viele, former business owner and executive director of the Southern Rhode Island Chamber of Commerce.
Right now, state officials say, only about 10% of the 68,000 receiving unemployment compensation are reporting to be working.
With his ear to the ground to hear businesses’ concerns, Viele said he’s hearing more than rumblings.
He said the ground is actually shaking as industries of all kinds — especially those in seasonal-dependent tourism — wonder where they will find needed workers to serve an expected record number of tourists returning to a pre-pandemic lifestyle of hanging out in South County.
To help businesses in South County and elsewhere in the state, State Rep. Carol McEntee sponsored a measure that would allow people under certain conditions to work part-time and still receive the federal bonus, according to Matthew Weldon, director of the state Department of Labor and Training,
This would enable the person to return to work part-time, collect the federal bonus and earn more money weekly than under current rules for state unemployment compensation, he said.
Viele observed, “There are alternatives to the problem and this is one of them and worth very much exploring. These businesses need the help anyway they can get it.”
The Predicament
D’Agostino said that he understands how people who depended on a restaurant - or any other small business - for a salary would feel after a year-long hiatus of work. “They’ve been put out of work for a year, you can’t expect to wait,” he added.
Right now he’s trying to recruit at least 10 people in the Wakefield and East Greenwich locations, “but the problem with our industry is that you hire five and only two will work out,” he said.
On the other side are people who prefer to collect unemployment rather than work. Several area people collecting unemployment declined to be interviewed for this story. One from Narragansett, however, offered a glimpse of her sentiments.
”I would like to remain anonymous as this is a very small town as I’m sure you know. I am currently working as a hairstylist and collecting Pandemic Unemployment Assistance,” she said.
She noted that because of state-required COVID-19 restrictions on the salons “we haven’t been able to take as many clients as we normally could. That really affects our bottom line so having those benefits has really helped.”
“I thank God that I have been able to have these benefits to supplement my work at the salon I work at in Narragansett. What I have found is that yes, people would rather collect than work, can you blame them?”
She said that often she finds that the unemployed are stigmatized for failing to find work, “but the reason for businesses not finding help is in my opinion multi layered.” She included the high costs of housing in South County and changes in fewer high school students wanting to work.
Robin Gallup Cichy, offered in a Facebook post, that perhaps people choose to stay on unemployment insurance “because it is more profitable than working. One of the considerations is child care. “
“If the person is staying home and taking care of their own child, and collecting unemployment insurance, It certainly beats out even an even swap for salary if you have to then pay 250 a week for childcare. I wonder how often that comes into play?,” she wrote.
A Solution
Department of Labor and Training’s Weldon, in an interview with The Independent, said that he understands the particular squeeze this problem puts on local businesses.
“In South County in particular, the hospitality industry is in the bedrock of the economy and so we know if those South County restaurants cannot operate this summer, it’s going to have a devastating impact on Rhode Island’s economy,” Weldon said.
“We need to do something and that’s why we are doing it now. Those changes we are trying to put into place along with the return of the requirement to be seeking work while on unemployment should help get people back into the workforce,” he added.
Weldon gave an overview of two major changes proposed in the bill that McEntee co-sponsored.
Current law only allows people to earn less than their current weekly unemployment benefits. If they earn more, they are cut off.
In addition, someone can only have free and clear 20% of those earnings before losing money from their unemployment pay.
The bill addresses these issues to provide more of a buffer so that, as Weldon noted, “You can earn more money, you can keep more of what you earn and stay connected to the $300 federal bonus and go back to work.”
The bill would allow instead someone to earn up to 150% of their benefit amount and still qualify for partial unemployment payment, but would not get full payment. “So long as they get $1 from the state, they’ll also get whatever the federal government provides,” he said.
For example, a person receives weekly $300 in unemployment compensation and another $300 boost from the federal government. Under current rules, if that person took a part-time job paying $449 a week, both the total unemployment of any kind and the federal bonus would end.
The proposed change, however, would allow the state to give the person $1 and that unemployment compensation qualifies the person for the $300 federal payment as well.
So, by going to work part-time this person’s weekly check would go from $600 to $750, according to the state DLT. However, unemployment benefits are taxed by both the state and federal governments.
In addition, those on unemployment who earn money from part-time work have a reduction in that overall benefit. The proposed bill pushes up from 20% to 50% the amount someone can keep before reduction kick in, Weldon said.
For example, if a person’s unemployment benefit rate is $100 weekly, the person can today earn $20 per week without a reduction in their unemployment benefit. With the remaining $80, the person’s check is reduced by $1 for every $1 earned.
So, if they earn $90 from part-time work, their benefits are reduced by $70, and their remaining unemployment payment is $30.
This second component of proposed bill pushes up from 20% to 50% of their weekly benefit amount that a person can keep without penalty.
In this example of someone with a weekly benefit amount of $100, the proposed bill would allow a person to earn $50 penalty-free. If that person earned $90, they would only have $40 subtracted from their benefit amount and would be able to receive $60 in unemployment benefits.
Weldon acknowledged that the rules for receiving unemployment can be complex and focus specifically on an individual’s personal circumstances. DLT has many resources on its website to assist in understanding benefits available and also a call center.
Weldon also said that the DLT is reinstating the requirement that unemployed workers document that they are seeking a job. It was not enforced during of last year’s pandemic.
Help Needed Soon
When going to the website of Pier Pizza, with restaurants in South Kingstown and North Kingstown, a pop-up message hits a viewer right between the eyes before scanning he menu, much less placing an order for delivery.
“Due to an industry-wide labor shortage, beginning on 4/23 we will be suspending delivery service. This is a temporary measure we are taking to maintain our standards of service. If you are interested in becoming part of the Pier Pizza team, apply online at pierpizza.com.”
Jordan Becker put the problem succinctly in an interview.
“Lack of applicants is the big issue,” he said, and added, “I honestly am not sure if the $300 (federal benefit) would help. I think whichever way is going to net people more income with the least amount of work possible is going to be the direction people lean.”
Casey Montanari, owner of the Bike Shop Café in Narragansett, worries whether the help will come soon enough.
“My issue right now is opening up right now…in time for the summer, without restrictions, and no one has any help,” she said, adding, “I can’t find anybody. I found somebody three weeks ago who showed up for three shifts and was gone.”
She said that she’s looking to hire three or four people to work in the kitchen and another several for waiter and waitress positions.
“It isn’t one industry, it’s all of them. Some people are scared (of catching COVID-19) and other people are abusing the system, working under the table,” she said.
Some business owners reported having interviews with people who demanded that they be paid “off the books,” meaning no taxes or records of their employment and in violation of state and federal law.
Other also pointed to a variety of secondary issues, such as thresholds on prices customers will pay and that income connected to higher salaries for workers.
“To pay employees more, you have to charge more and people don’t want to pay more to go out to dinner to a restaurant,” said another owner.
In addition the old staple of high school and college students working in kitchens and cleaning tables is not as plentiful in some towns as in others. Owners blame the push on athletics and after-school activities to qualify for college scholarships.
There’s also the problem of unreliable people simply failing to show up for scheduled interviews, they said.
DLT’s Weldon again said he understood the situation, the variety of problems and empathizes with the owners.
“There is not a single solution to this incredible challenge. It is one possible way to get people to go back to work. The (Governor Dan McKee) Administration is also thinking about different ways to offer incentives in different areas,” he said.
He also noted that as DLT’s nearly 450 staff workers struggled with varying working conditions — such as remote work — they faced historic numbers of people seeking unemployment assistance so far during the pandemic.
He and other agency officials never imagined the magnitude of 125,000 people unemployed at one time, the largest number in state history, Weldon said.
“Right now, we’re focused on getting people who are unemployed to go back and to take work,” he added.
May 07, 2021 at 07:00PM
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Local businesses faced with a new issue: finding people willing to work - The Independent
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