As time moves us further from the pandemic's beginnings, some artifacts of the Before Times seem more and more antiquated — especially when it comes to how Americans work.
I don't just mean, say, companies' arbitrarily forcing people who've worked just fine remotely back into the office. I mean the tradeoffs Americans have until now been willing to endure for their survival. It's a rethinking that has spawned a rash of worries that the recovery will be hampered as some businesses struggle to find hires for open roles.
It's true that some companies and industries are finding it difficult to fill positions — but it's not because of a labor shortage. The laborers are there, and many of the people who are still unemployed are willing and ready to work. No, what we're seeing is the effect of a yearslong wage shortage. And that lack of money in people's pockets is playing out before us.
Low-income earners, the people making $27,000 or less annually, are the ones who were hurt the most when the pandemic struck — janitorial workers for closed offices, food and beverage staffers at closed restaurants, salesclerks at stores that couldn't retain staffers at brick-and-mortar shops. But data show that they are also the group having recovered the least since Covid-19 reached the U.S., with employment rates still about 16 percent below average nationally.
The work Americans put in doesn’t match the wages that come out, especially for lower earners.
This disparity between the number of people unemployed and the number of open jobs seem like a paradox at first. But then you remember that wages in the U.S. have grown far more slowly than you might assume over the last half-century compared to how much more productive the average worker has become. The work Americans put in doesn't match the wages that come out, especially for lower earners, a gap that has become untenable for many.
And the people who are among those bottom earners? They are tired after the year we've just had — especially hospitality workers. This Twitter thread from Stefanie Williams struck a chord with a lot of the waitstaff and bartenders out there. "While so many who have worked in the industry for years have the thick kind of skin it takes to survive and thrive, 2020 was a breaking point for a lot of people," Williams wrote.
It seems like in the face of that kind of treatment, the idea of returning to work for wages below the federal minimum in many states — and depending on the generosity of the kinds of people who continued to dine out in the middle of a public health crisis — isn't exactly appealing. Go figure.
Before we continue, I just need to emphasize that the solution is not, as many Republicans seem to think, turning off federal unemployment benefits. Some Republican governors are going so far as to start to reject the additional $300 per week in benefits from Washington, months before they expire in September, to the detriment of their states and a disproportionate share of their minority residents. In doing so, they're threatening 3.5 million workers who count on those benefits still — are they all supposed to be hired at well-paying jobs before the next rent check is due?
Now, if your argument is that these were supposed to be temporary measures, I'm willing to have that debate. I think the country can afford to support people who are out of work; let's figure out how to make this a permanent part of the social safety net. But if you're arguing that these unemployment wages keep people from looking for work, then there's more to unpack there than you're letting on.
The Wall Street Journal recently reported that a "University of Chicago study found 42 percent of those on benefits receive more than they did at their prior jobs, and the share is higher when factoring in temporary health insurance offered through relief bills." What does it say about what they were being paid before if an extra $300 a week is enough to lead people to eschew working altogether?
The unemployment benefits also don't explain the other factors people have cited in their hesitation to take jobs, including the number of unvaccinated people still out there and the lack of child care options. Schools' being able to reopen fully will take care of some of that pressure — as would an uptick in the vaccination rate among the holdouts.
Other fiscal conservatives have also pointed to the fear of inflation as a reason not to raise wages. "Psh" is what I say to that. A lot of the rising costs you may be seeing are the product of consumer demand snapping back after a year of suppression — the supply isn't able to keep up yet, in terms either of labor or of raw materials. There's a reason, for example, that the cost of lumber has skyrocketed in the last few months.
The answer, then, isn't to keep wages low, depressing demand, but to raise them so people can afford to keep buying. As hard as it is to find workers who are willing to staff restaurants right now, do owners think they'll be better off if potential diners are suddenly less able to afford to eat out?
In the face of this pressure, some of the largest corporations are starting to raise their wages to attract new hires. While that's great for companies that made major profits during the last year, like Bank of America and Walmart, it's harder for small businesses to match those rates. But it's not impossible, as Jacob Hanchar, co-owner of a Pittsburgh ice cream shop, told MSNBC's Stephanie Ruhle:
There's been a lot of talk about how Covid-19 "changed everything." I don't know if that's true, but workers' demanding appropriate pay for their labor is one change I'm very here for. The main solution to the "labor shortage" should be obvious: If you pay them, they will work.