Back to Work!

One of the more recent things Republicans and Democrats have argued about have been the expanded federal unemployment benefits passed during the pandemic. As you may recall this put an extra $1,200 in the pockets of the unemployed on top of their regular state benefits.

Republicans have been arguing that this giveaway has kept people from going back to work. Why go to work when you can sit home and play Xbox and get paid to do it?

Democrats argue that people aren’t going back to work because of fear of Covid and childcare issues.

I’ve noted here before that all of those factors are real, although judging by the crowds I’m seeing everywhere I don’t think the fear of Covid is stopping anyone from about anything these days. There are some still sheltering in place but it’s clearly a much smaller number.

With summer here and school out I can see childcare issues being a factor, however, parents had to deal with summer schedules before the pandemic ever hit, they had to have had a plan back then. To me those two things don’t add up to the ridiculous amount of help wanted signs I see.

We are soon to find out and some initial data is trickling in as Republican governors in 21 states have ended the federal unemployment boost early in an attempt to get people back to work.

While it’s just one example, Midas Hotel group in St. Louis Missouri has noticed the change.

The hotel company which operates 44 locations around the U.S., started holding job fairs to increase staffing as coronavirus restrictions eased about two months ago. In many cases, no one showed up, said Linda Eigelberger, senior vice president for operations and marketing. Other times, only two people would arrive, immediately get offered jobs and then not show up to start work, she said.

Then a few weeks ago, things began to change at its Missouri locations (a state that ended expanded benefits on June 12th). At one property, seven people came to a job fair, which Eigelberger took as a positive sign. Then, two weeks ago, the Element St. Louis Midtown hotel had a breakthrough with 40 job seekers, she said.

“It’s crazy how quickly” things seem to be ramping up, she said, noting that workers in other states where Midas operates and the federal benefits are still in place appear reluctant to re-enter the workforce.

My gut tells me that we’ll be hearing more examples just like that one. In the meanwhile the governor of Indiana is being sued for ending the benefits too early. Who knows what will happen with that, but it may be September when the benefits are scheduled to end anyway by the time that gets settled. Who knows.

What I do know is that this labor shortage is causing serious damage to the economy and anything that nudges people back to work is a positive thing.