Business should be booming, if only there were enough workers for the job | Hacker News Reader

Business should be booming, if only there were enough workers for the job

npr.org

22 pointspaulpauper65 comments

Business is booming, which is why wages are rising and there are more jobs than laborers. The headline is misleading because the author tried to focus on a handful of businesses who were behind the curve on their hiring requirements.

The obvious retort is "raise wages", but that's exactly what one of the interviewed businesses is doing:

> The Wacky Knacky Diner in Osage Beach, Mo., near the Lake of the Ozarks, boosted wages to $20 an hour, then added health benefits and a retention bonus.

The article also notes that they found twice as many job listings offering hiring bonuses as compared to a year ago. The market is working as appropriate and the situation is sorting itself out. These headlines are starting to feel like clickbait.

They also highlighted some other temporary and seasonal roadblocks, such as parents being at home while their kids are out of school:

> A survey by Indeed found most job-seekers plan to start working within the next three months, but many are waiting for schools to reopen, vaccination levels to rise or for their personal savings — boosted by unemployment benefits and three rounds of federal relief payments — to run out

The article is worth a read. There's more to it than the "just raise wages" comments.

Many of these articles are about tourist towns that have had an influx of new residents and/or increased seasonal populations (in this case Hood River, Oregon and Lake of the Ozarks). I read an identical article yesterday about Ketchum, Idaho and last week about Telluride, CO. In such cases, the problem is two fold. There has been an increase in the total need for workers to serve the additional residents and visitors. At the same time, the supply of worker housing has gone down (and prices up). Raising wages is not enough to balance supply and demand since the housing market does not adjust quickly enough. I sometimes wonder if these towns are economically sustainable -- wages can never rise quickly enough across all necessary occupations to establish equilibrium with the outside money forcing workers out.

Well the fact there is more jobs than laborers can be explained by the government actions. If the government offers free money it rises the minimum wage that people are willing to accept. And if they do not produce more than before it means they are more expensive for the same quality/quantity and the prices will rise. The nominal numbers will get bigger eating away the savings that are kept in cash. Do not keep cash, invest or spend.

Raise prices and raise wages. Or if you can't compete, go out of business because others will be able to.

Alternatively, maybe it's the optimal strat (in terms of maximizing profit) to only be open 4 days a week/or be short staffed. If so, that's fine too.

Yeah, I don't understand this at all.... if they can't pay enough to attract labor because it will make them unable to be profitable, than it is false to say "business would be booming".

Yeah, lots of businesses would be booming if they didn't have to pay market rate for key materials. You don't see many articles about manufacturers saying "my business would be booming if I only had to pay half the going rate for steel!"

I think things are a little more complicated now that we’re in a global economy.

Some jobs cannot be outsourced, for example from the article, baking pizzas.

It makes the math harder, but it is still about supply and demand.

Wages are a huge part of it, but right now these companies are trying to go from < 25% capacity to > 100% capacity in just a few weeks. Companies got used to being in an employers market for the last decade or more to an employee market overnight.

Plus there are a ton of other factors affecting employees that I really wish reporters would research more. Just a few the ones I've heard:

* Got a different (often better) job

* Went back to school full-time to get or finish a degree

* Lack of transportation - sold their car during COVID and can't afford to buy one now

* Lack of childcare - can't find or afford childcare now (demand is pushing up prices there too)

* Staying home with the kids - after being forced to do it some people decided staying home to raise the kids is a better life and they could afford to do it

* Unemployment is still paying better than any job they can find

* Retired - some people were putting it off and others decided to retire early rather than go back to work

* Long COVID - still sick or physically impaired months later

* Dead - COVID or other causes

Long-COVID is the one I would personally like to see statistics around. I know a couple people in their 30s and 40s that are still unable to function normally 6+ months after being seriously sick with COVID.

Once again people are all for yelling "economics!!!" when scolding others but don't like it when it supply and demand applies to them.

> Raise prices and raise wages.

They're doing that and adding benefits, too. From the article:

> The Wacky Knacky Diner in Osage Beach, Mo., near the Lake of the Ozarks, boosted wages to $20 an hour, then added health benefits and a retention bonus.

There's more to the article than businesses complaining that people won't take their jobs at fixed wages. It's about how businesses are adapting, raising wages, adding benefits, turning away customers, and management is taking advantage of the lull by taking their own vacations.

The article also highlights some of the temporary roadblocks to getting people back into the workforce will naturally go away in the next few months, such as parents who are home with children while school is out for summer:

Some of my extended family has been facing this problem - they’re blaming the pandemic, unemployment assistance, and even raised the salary they’re willing to pay. They’re all the way up to $7.45/hr (that’s $0.20/hr more than they offered before the pandemic) with 0 benefits and a random work schedule of 10-20 hours a week.

I tried to explain that they had three levers they could try to move and they continue to blame the people who didn’t want to work.

I do think unemployment assistance is an actual problem here. Not that it shouldn't exist, but that it shouldn't have a cliff where you immediately lose benefits.

I know people who make more now not working than they did pre-pandemic when they were working. I've also noticed rates advertised at over 20% increase (somewhere in the range of being $15-$20/hr) from just a year or two ago, with a signing bonus, that aren't being filled.

I suspect they aren't being filled because people would have a very marginal increase of pay compared to not working having unemployment assistance. I know I wouldn't work if I would be sacrificing 30ish hours a week for 10% increased pay.

It's almost like capital owners take workers for granted.

Why would people not spend their lives to make capital owners rich? /s

The solution is obvious bring back the slavery.

I don't think I need to state this but just in case its /s

Maybe pay a decent wage. I dunno, is supply and demand too much Free Market Fundamentalism?

The wage has to, post taxes, still be a worthwhile tradeoff to the enhanced unemployment benefits people are being paid to sit around and do nothing. That's not to say employers are being reasonable here, but people who lose benefits because they take work are typically facing the highest effective marginal tax rates, and there's little an employer can do about that eligibility cliff.

Whatever the reasons, the market rate for labor is the market rate for labor. If you can't make a profit paying the market rate for labor, then you are not a viable business.

Now, if we find out that our economy grinds to a halt because there are not enough businesses around to provide for the needs of the public, or if we experience rapid inflation, THEN we can say the things you mentioned might be issues that need to be confronted.

I think people are really underestimating the number of people who have fallen back to the "middle class safety net" of parents.

It's mostly the orphans, abused, generationally poor without a safety net that are back to working underpaid / under appreciated jobs.

Why get back on the service worker treadmill (that discarded you during the pandemic) once you've already moved and blown up all your social ties if you can chill at home with parents while you try to change careers?

So many adults who grew up in the middle class really underestimate the compounding power of a safety net but they are finally realizing it.

I'd be willing to bet that a lot of people didn't take that option before the pandemic due to social stigma. With that gone why not make the rational choice?

A family safety net changes your entire decision process to more heavily weight "Maximize Opportunity" over the impoverished priority of "Mitigate Risk". I think a lot of people were just socially pressured into moving out and taking service jobs instead of making the more rational choice.

>> Greenspan had stated that growing worker insecurity is a significant factor keeping inflation and inflation expectation low, thereby promoting long-term investment

This is modus operandi of the system. Its by design. A worker that has a mortgage, car on loan and bills to pay cannot mouth off to boss, cannot complain about long hours and lack of pay increase. They risk their whole life to collapse otherwise.

That is a perfect cog for neo capitalistic machine.

Heh, the company mentioned in the first paragraph has this as their jobs page:

http://solsticewoodfirecafe.com/contact

What the heck do they expect people to do here? This forces people to know what positions are open ahead of time, and if they don't, they're basically throwing applications into the wind. Just post the damn openings!

NPR, you can do better.

I kind of wonder if requirements/specific postings deter or increase applications.

As they would have jobs with little more in the requirements than being healthy and able, so really they could probably use anyone willing to work.

I can't speak to that, but if I were looking for a job and saw this, I would take it to mean that they don't have any openings available. Kind of like when someone says, "We're not looking for anyone right now, but please still send a resume.. you never know!". Everybody knows that goes nowhere.

> What the heck do they expect people to do here? This forces people to know what positions are open ahead of time, and if they don't, they're basically throwing applications into the wind. Just post the damn openings!

It's a small restaurant, not a tech company. You're either working in the kitchen or front of house. People in the food service industry basically know the drill. You don't really need a job listing with bullet points of every responsibility because they're not really unique to each restaurant.

They're savvy enough to pay for a nice site, but not savvy enough to add a couple lines of text on their website? Not buying it, sorry.

I (mostly) agree with your point about how the food industry operates, but in this situation, the company agreed to be interviewed by the media in order to make a larger statement about the economy. When there are trivial things they can do, but aren't, I'm not sure how it fits into a narrative about the larger economy.

Edit, this is literally all they need to do: https://i.imgur.com/KY08Hne.png

Honestly if restaurants went into detail about what is entailed in the job they probably get even less applicants lol. It's tough work. Often no healthcare or benefits.

The gender aspect of this really should get some attention. When schools closed women left the workplace in huge numbers in order to take care of their kids. Now the reopening of schools is messy and inconsistent and there are still huge problems providing enough day care service to meet the demand. If we really want to get workers back then we are going to need solid plans for reopening schools and providing day care. Unfortunately, people are getting distracted by the lazy workers hooked on stimulus and unemployment insurance narrative and not focusing on what clearly needs to be done.

There's nothing unfortunate or that needs to be done about women leaving the workplace to take care of their kids and deciding to continue.

> There's nothing unfortunate or that needs to be done about women leaving the workplace to take care of their kids and deciding to continue.

But if those women stay home, they won't be liberated to find fulfillment by satisfying the needs of capital! Day care is an ideal solution for society, because it increases the market participation of all members of the family. /s

> He's struggling to find all the workers he needs to churn out his pizzas, and he's losing valuable business.

There’s literally no way there aren’t enough workers to make pizza so long as unemployed people exist. This is a problem with their hiring practices. Maybe there’s a squeeze on illegal immigrants working for sub-minimum wage and slave hours, but there’s a bunch of Americans willing to work if you actually pay them.

If demand is outstripping supply, raise prices and wages?

It's free to whine to journalists looking for an easy article (and clickbaity too!).

The conservatives i've spoken to (and know personally) suggest that we should be gutting social programs like Unemployment because they're the reason why people are demanding more money - it's too easy to get it "for free".

Curiously, this has become a theme. Nearly a meme, honestly. In every major debate i've spoken to them about, say Gun control and school shootings - the answer is to double down. Not less guns, but more! Give teachers guns! etc. Now i'm not interested in having this debate here, on any front, but i am curious about this line of thinking.

Is this "doubling down" observed by anyone else? If so is there something interesting at play? It feels odd to me that the response seems so frequently to dig in deeper. More guns. Less social protections. Less environmental protections. More oil. etcetc

I posted a similar question here[1].

I'm not a GOPer, but I do hold some fairly free market beliefs, so I wanted to answer your question about the general case. I think some of this thinking comes from the fact that there's been a lot of legislation in the past that attempts to solve market "failures" with more government regulation or subsidies, and that those promises have fallen short. In my mind, there are a lot of liberals in the US who say things like "if only the stimulus was larger" or e.g. after the "assault weapon" ban failed to demonstrably change gun violence in the US that we "just needed to ban MORE guns".

For me, the big one on this is healthcare. I'm the first to admit that a single-payer healthcare system is my 2nd favorite system after a purely free market approach, but there's a lot of gaslighting going on that what we have today in the US is actually a free market approach. Liberals tell me that the free market failed, and that it's time to socialize healthcare. But from where I'm sitting, we've had massive governement intervention in healthcare for a century, and that intervention has made the market aspect of our system fail completely, govt subsidies for employer-provided insurance being the number one (inflates prices by increasing demand for lower-pri care, ties people to their employer for longer than they'd otherwise do), but also Medicare/Medicaid and the lack of insurance pools across state lines.

This debate falls out most cleanly when you debate the Laffer Curve. Are we on the left of optimum, or the right? There's really no way for us to know for sure in a vacuum, but "doubling down" is the only approach that either side can really take in pushing increased or decreased tax rates.

Obviously, I didn't flesh out all my positions here, and I don't mean to get into a debate on any of these things in particular. I'm just trying to help explain some of my own logic in response to your question.

[1]: https://news.ycombinator.com/item?id=27778374

I posted an interview about the open-pricing surgery center of Oklahoma which actually goes into how a free market healthcare system would work.

A free market system would make for even more uneven differentiation in health care quality - with some people not being able to receive care at all at the end of the day. Yes, on average we would have better health outcomes (same as most people would have better outcomes on average if you didn't require car insurance, since most people don't end up using it), but the few outlier cases would be significantly more tragic than they already are.

Yea, i'm quite liberal but in my perspective it's not about what works best - but what's most moral. To me capitalism runs by greed, which isn't a bad thing, but you can't depend on greed to be inline with moral based outcomes. Competition might be best, but how often do companies decide that competition is not in their favor? Frequently it's gamed/etc.

So my view is that anything that matters, like healthcare, should not be managed by capitalism. It can play a part, but something motivated by human good should be at the core of some decision making processes. Which capitalism is definitely not. Government has far to go, but capitalism has no place in moral based decision making. Imo.

Prices are skyrocketing near me for unskilled positions.

The “free hand of the market” is only desired when the oligarchs are benefiting.

I'm seeing a lot of "just raise wages" in this thread. The traditional GOP response on something like this is to get rid of the extended and special unemployment insurance programs, and you'd see folks re-enter for minimum wage jobs.

I'm not an expert in this field, but that naively seems like it would achieve the same result. Obviously there's a conversation to be had about fair wages, and whether a minimum wage is livable, but is there something else here that I'm missing about why that wouldn't also mitigate the current labor shortage?

Extended unemployment has already been eliminated in many states and that had no effect. This might be an opportunity to review why these ideas about labor markets appear not to match what actually happens.

I read an article[1] about workers suing states to restart extended unemployment (and are winning, at least in Maryland and Indiana so far). This would have an effect on the job market.

[1] https://www.msn.com/en-us/money/markets/when-unemployment-en...

So then how are people paying to survive?

Ending the extended unemployment benefits only reduces the weekly unemployment payment. In my state that was an extra $300/week. Our Governor got rid of that, but the labor shortage remains.

But eventually the standard unemployment will run out too, right?

Yes.

My answer is that for me (and I'm assuming a lot of people) it would just be too immoral to do that. It's like forcing people to work against their will.

Your solution could definitely work, it's just less humane, so there are fewer people who naturally want to advocate for it.

You might ask yourself why you want to stop at cutting unemployment benefits, when there are even more effective ways to coerce people into working.

Well...I personally wouldn't want to stop at unemployment benefits, but I'm not trying to make that case here because I understand there's a lot more moving pieces and it's much tougher case to make.

Well, it's not a "labor shortage" because, as others have explained, there is an ample supply of workers if an employer is willing to pay for them.

> is there something else here that I'm missing about why that wouldn't also mitigate the current labor shortage

- 600k+ dead people.

- Increased hiring competition from more remote-friendly jobs.

- Workers who don't want to return to employers who laid them off at the beginning of the pandemic or required them to work in unsafe conditions as "essential" workers.

First one is totally valid, and honestly a bit chilling. Not sure why that wasn't obvious to me.

The 2nd one seems dubious to me: in my experience, people are moving to remote-friendly jobs from within the US...it doesn't explain why we have a shortage of people making pizza.

The last one is the one I'm struggling with: I don't knock people at ALL for making those choices, but if they're struggling to survive and (as others have noted in response to me) unemployment insurance has ended, what are they doing instead of taking a job?

Unemployment insurance hasn't necessarily ended. The extended benefits have in many case though. Those extended benefits included things like more money per week and benefits for longer.

Regarding increased competition for people working from home, you're right. It might not be a huge factor, but I know two people who used to work in IRL service roles pre-covid who now work for call centers from their homes. So it is a possible factor even if it's a small one.

The last one is definitely a factor, but #1 is hard to believe since the vast majority of the dead were well past retirement age. Similarly anyone in the running for a pizza tosser position is probably not also considering a remote software development job.

Every story like this should be required to post wages. I looked at the job postings for several Canadian employers complaining about labour shortages and they were hard labour jobs for minimum wage.

We had ~650k deaths from covid19 in the last year alone (and counting), bit part of them were minimum wage workers. After the black plague in Europe, labor was in such a short supply that wages multiplied. This is definitely having an effect on the labor market.

The consensus here seems to be that companies should start raising wages significantly. There is no other way.

That’s a popular narrative, but it may not be true. Of the 650k deaths in the USA, about 475k were people over 65 and most were probably out of the labor force[0]. That’s not to say that a 175k hit to labor force is nothing, but it’s not the sole factor at play here.

[0]: https://data.cdc.gov/NCHS/Provisional-COVID-19-Deaths-by-Sex...

COVID killed about 0.2% of the population and about half of the death were in the >80 years age range. The death rate in the working age population has virtually no impact on the labour supply.

Not to be morbid, but dead people don't consume, either. You are right that they are no longer in the labor pool, but they are also no longer in the consumer pool.

Given that Covid disproportionately kills elderly people, who are out of the labor pool but still consuming, I would think their deaths would cause a greater reduction in consumer demand than in labor supply.

> bit [sic] part of them were minimum wage workers

I'm not sure that's correct. According to the CDC the vast majority of deaths were among people 65+ [1]. The curve for minimum wage workers is pretty much the opposite, the vast majority of minimum wage workers are between 16 and 24 yo [2].

[1] https://www.cdc.gov/nchs/nvss/vsrr/covid_weekly/index.htm#Ag...

[2] https://www.statista.com/statistics/298852/minimum-wage-work...

Only about ~120k of them were even under 65: https://www.cdc.gov/nchs/nvss/vsrr/covid_weekly/index.htm#Se...

Considering that even those will be weighted towards towards the already disabled, there's no way this makes a meaningful dent.

Its not just wages, it is all the barriers to employment: screening/background checks, pre-employent tests, required credentials, long interviews, etc. Even doing all of these in no way guarantees a job.

It's soul-crushing to write a cover letter characterizing yourself as passionate about <menial work> and super interested in <company that you would never work for if you had a good alternative> as well.

Raise wages

Good luck competing with the government's free money. The only solution is inflation. Let's increase the nominal wages, hence prices, while inevitably reducing the real wages, and purchasing power of savings. It may be a good time for assets owners at the cost of the middle class. Inflation is taxation but it is safer for politicians, since common people do not get it and do not blame the culprits.

Stop subsidizing unemployment with welfare checks, which in many cases pay the recipient more money than they were making working.

You cannot create money out of thin air at the rate we a printing it unless you want hyperinflation (you don’t).

It’s not only damaging to the economy—business owners cannot operate and consumers cannot get what they need. It’s harming the work ethic of the unemployed and their sense of self-worth.

I do not buy the “raise the minimum wage” argument. Enough people have shown they would rather not work and get paid less than work and get paid more.

The continuation of unemployment subsidies is forcing companies to compete against the federal/state government for workers in a losing battle—it’s hard to ignore the possibility this is intentional on the part of those in power who want to force the minimum wage increase. Which, by the way, results in higher unemployment in a way inverse to how rent controls result in less available housing.

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