Why is Biden backing unemployment benefits after weak April jobs report?
Robert Wolf, former Obama economic adviser, and Fox News contributor Sean Duffy debate the state of the economy as many businesses struggle to find employees.
Some U.S. small business and restaurant owners claim President Biden’s unemployment benefit extension is making it difficult to hire new workers.
The president’s American Rescue Plan included a $300-per-week unemployment-benefit extension through September of 2021 despite concerns from Republicans that the benefits may be holding Americans back from finding new employment opportunities.
Nationwide, employers say they are competing with the government for workers.
Buddy Foy Jr., 50, owns two restaurants with his wife – one in Bolton Landing, New York, called The Chateau on The Lake and one in Holmes Beach, Florida, called The Chateau Anna Maria, which opened in December amid COVID-19.
The Florida restaurant has seen booming business since Gov. Ron DeSantis reinstated work-search requirements for Floridians seeking unemployment benefits, Foy told Fox News.
“Our staff’s overwhelmed answering those phones, which is a good thing,” he said. “We had zero inquiries for a job. We had 30 in the last seven days. Does it mean we’re going to hire all of them? We have 15 jobs to sell. Are they all qualified? No. It means we’re getting back to pre-pandemic conversations.”
His New York restaurant, meanwhile, has been closed since November when New York Gov. Andrew Cuomo implemented a curfew on outdoor and indoor dining, which he plans to lift in May.
Foy is recruiting his Florida workers to help reopen The Chateau on the Lake due to a lack of available workers up north, he said.
The restaurant owner added that he is also offering $250 bonuses to employees who recruit new workers who stay on for at least a month and said other businesses in the area are doing the same to stay competitive.
One business owner told Democratic Michigan Rep. Haley Stevens during an April 9 Rotary Club virtual meeting (23:20 minute mark) that he can’t hire new workers despite offering $15-per-hour wages and $500 signing bonuses for new, entry-level employees.
Christensen’s Plant Center owner Tim Joy said his company “cannot get employees because our government is our competitor for those people.”
“They’re getting $15.47 an hour if they’re working 40 hours a week on unemployment,” he said. “…We’re using our own tax dollars to compete against ourselves.”
Stevens responded saying she’s sure Joy is calling people who are saying “they’re making more on unemployment, which…we’ve got to ask the state why that’s happening if people have a job opportunity.”
“We can’t just be in this state-supported nanny environment going on and on and on,” she said.
New Hampshire, Ohio
Alene Candles CEO Rode Harl told The Daily Progress that his New Hampshire and Ohio facilities are looking to fill 1,500 positions.
“We have had more than 100 positions open since the start of the year, and just recently we increased sign-on bonuses to $1,200 for hourly positions – in-part because we are competing with an entity that can print its own money – the federal government – and its $300 per week additional unemployment benefit,” he told the outlet.
In Iowa, John Deere is offering employees a starting hourly wage of $19 per hour because it can’t find enough labor to meet demand, according to the Des Moines Register.
Deere & Co. reported an $8.1 billion backlog in equipment orders in its November SEC filings, as the Register first reported.
Iowa State University’s Center for Industrial Research and Service Director Ronald Cox told the outlet that he believes the issue is not unique to John Deere.
“People leave other companies to go work for Deere. If Deere is having problems, it’s much broader than them,” he said.
San Diego restaurant owner Dario Gallo compared the quest for new hires to a war between competitors.
Gallo, who owns Civico by the Park and Civico 1845 told The San Diego Times that he is offering $3 more per hour than his pre-coronavirus wages to bring new workers on.
“A restaurant sent workers to approach my employees and they would say, ‘How much are you making? OK, $17 an hour? I’ll give you $19 or $20 an hour if you come today,’ and they don’t even give two weeks’ notice,” he told the outlet. “So literally I was about to close both locations. Thank God, my brother at Civico and my chef at 1845 jumped in to do line cook duties, dishwashing, preparation during the day.
“It’s like a war, just because it feels like this is endless.”
In Washington, hotel owner Walt Worthy has cut his staff down from 1,200 people to fewer than 350, The Spokesman-Review reported.
“We are competing against unemployment. All the hard times you hear are going on out there and you can’t find people who want to work,” he told the outlet. “All the hard times you hear are going on out there and you can’t find people who want to work.”
Dondlinger & Sons Construction Vice President Raymond Dondlinger told KWCH that his company doesn’t have enough workers to handle its construction jobs.
“You’ll see a lot of our customers and clients that we work with through the past years, you know, they’re wanting to build new things and construct new things for their businesses. And we have opportunities, but we don’t have the people to help us build those opportunities,” he said.
The owners of Mom and Pop’s Diner in Carson City, Nevada, posted a notice outside their building saying their restaurant is closed on Tuesdays due to a lack of cooks on that particular day, according to News4, and they were not the only business in the area to post help-wanted signs.
“We can not find kitchen help to work. As most people know, when you’re getting more money on unemployment than when you work, why work?!” the sign reads, according to the outlet.
Large businesses in the area, including The Grand Sierra Resort and Atlantis Casino Resort, are experiencing similar issues.
“GSR finds the job market extremely challenging and continues to increase wages and incentives for a myriad of open positions within our property,” the Grand Sierra told the outlet in a statement.
Snoopy’s Hot Dogs co-owner Larry Cerilli told WRAL that four of his restaurant locations have reported a 60% drop in employees and he is working 70 hours a week to keep the business running.
“We’re all trying to pitch in to get through the day. And the answer is we just need some employees,” he told the outlet.
In Carrollton, Georgia, Barnes Van Lines owner Chris New told the Atlanta Journal-Constitution that he has turned down $250,000 in business because he can’t find enough laborers and drivers.
“There are plenty of people without jobs, but unemployment benefits give them too much incentive not to work,” he told the newspaper. “We advertise and nobody comes in looking for a job. A lot of people are taking advantage of the system. It’s really killing us.”
Chef Mike’s Atlantic Bar & Grill owner Mike Jurusz told NJ.com that he is having trouble recruiting new hires and blamed Biden’s expanded unemployment benefits and stimulus payments as the reason behind the apparent lack of interest.
RESTAURANTS NATIONWIDE STRUGGLE TO FIND WORKERS AS UNEMPLOYMENT BENEFITS OUTLAST CORONAVIRUS RESTRICTIONSv
While Jurusz employs about 15 people yearround, he typically boosts employment to 60 people over the summer to meet increased demand, which makes up 90% of his annual business, according to the outlet.
“We need 40 or more employees, and I’m getting scared,” he told NJ.com.
New Jersey restaurant owner Tim McLoone told the outlet that while “there’s no question that unemployment has contributed to the diminishment of the labor market, it’s not like” unemployed Americans are “staying home to watch ‘The Price Is Right’ and they don’t want to work.”
Marianne Mize, owner of the Grapevine in Henrico, told WRIC that while there are “plenty of jobs out there” for Virginians looking for employment, some may be choosing to stay home and collect benefits.
Mize said, “There’s plenty of jobs out there right now” and speculates some people may be choosing to stay on unemployment.
Fred McCormick, a general manager at a local Arby’s location, agreed.
“They don’t have to worry about COVID,” McCormick told the outlet. “I mean, we do all the process that we were supposed to do. We take care of our customers and our employees.”
In Connecticut, Metro Bis chef-owner Christopher Prosperi recently opened his restaurant on April 30 after being closed for two months and is now struggling to find workers, according to The Hartford Courant.
“The reason we’re open on Thursday, Friday and Saturday only is because we’re waiting for the college kids to come back. They’re the only ones not on unemployment,” he told the newspaper.
“American taxpayers should be furious that Democrats made it more profitable to collect unemployment than to work,” National Republican Congressional Committee spokesman Mike Berg told Fox News in a statement. “Their socialist agenda is destroying small businesses across the country.”
Americans are not supposed to continue to collect unemployment under any circumstances if they have a suitable job offer, a White House official told Fox News last week.
Despite that, the Labor Department reported dismal job numbers last week. Employers added just 266,000 jobs last month, well below the consensus 1 million forecast by most economists, suggesting that people are not applying to jobs as quickly as business owners anticipated.
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“We’ll insist that the law is followed with respect to benefits, but we’re not going to turn our backs on our fellow Americans,” Biden said Monday. “Twenty-two million people lost their jobs in this pandemic, through no fault of their own. For many of those folks, unemployment benefits are a lifeline.
Some politicians and pundits have argued that the hyper-competitive labor force is due to COVID-19 fears and a lack of satisfaction with hourly wages.
Secretary of Commerce Gina Raimondo, for example, on Sunday dismissed claims that the unemployment benefit extension impacted the most recent jobs report, citing COVID-19 fears instead, and suggested that governors in different states do what is best for their respective labor markets.
“This is regional, and it’s appropriate that governors in different regions would respond to what’s going on in their regional labor market. But if you look nationally, wages aren’t going up,” Raimondo said. “People are still telling us the number one reason they’re not going back to work is fear due to the virus. And more people were looking for work last month than the month before.”
One Fair Wage President Saru Jayaraman and author Mark Bittman in a Sunday op-ed for The Guardian pointed to a “wage shortage” as the root of the problem with employers finding workers.
“…This isn’t, as many industry representatives would have you believe, a shortage of workers,” they wrote. “It’s a wage shortage that is racist and sexist in that it disproportionately affects women and people of color, and is a legacy of slavery.”
Meanwhile, some states have suspended federal unemployment benefits early in an effort to combat what is being described as a labor shortage.
Fox News’ Megan Henney contributed to this report.
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