This is not a real thing, this is a fake assertion you have invented in your mind. No one is getting paid to "not work". And no, workers who have lost their job, collecting their unemployment they earned during past labour, never counts as getting "paid to not work".
>Once the government spending stops, things will change quickly.
In most places, the paltry, tiny financial aid for workers ended months ago, and nothing has changed at all.
> For instance here our dog daycare can’t hire enough employees
They should consider paying wages. If they paid money for labor, they'd get labour. It's really that simple.
What most "employers" actually want is nearly slave labour, volunteers, like they had pre pandemic. Employers swear up and down that no one wants to work, and then you find out they pay just $15/hr or some other insultingly low slave-like wage (a wage so low that no human could feasibly live alone off of it, much less advance in any way in their life).
A single adult with no debt, and no dependents, in Michigan, "making" $15/hr doesn't even take home enough money to rent a modest 1-bed apartment in the city, much less eat or do anything else with their life. At this wage, the adult is literally poorer every day they show up to work, they are literally donating their labour to a for-profit company. And most people are not "perfect ideal adults", they have children, or student loans, or elderly parents, or a tricky medical condition, or any other totally-normal totally-reasonable life complication that they need money to help cover, so they can show up to do good work for you.
I don't know your local market, but I guarantee if your dog daycare was in Michigan and it started paying $25/hr, they'd fill those positions in just a few days. Their employee "shortage" is a fake problem they have intentionally created for themselves, not some sort of indicator of people's willingness to work.
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Everyone wants to work right now. No one is hiring at a liveable wage. Most reasonable people are not going to get out of bed and go to work all day, just to end the day poorer then they started. That would be insane. But that insanity is what every company seems to demand of labour these days.