Companies struggle to find workers as economy hums
Ron Sandlin has tried everything.
He’s boosted pay, added vacation days and even lowered the minimum age requirement from 25 to 23. But he still can’t find enough qualified people to drive Patriot Transportation Holding’s oil trucks.
“I’ve been in this business since 1984, and I’ve never seen what we’re dealing with in terms of hiring people,” said Sandlin, president of the Jacksonville, Fla., trucking firm. “Driver pay is going to have to continue to go up, and our customers are going to have to pay for it.”
This is what full employment looks like. A decade after the worst economic downturn since the Great Depression, the United States suddenly finds itself at a place where almost everyone who wants a job can find one. The unemployment rate in December was 4.1 percent, leaving employers struggling to attract and retain good workers and raising the prospect of higher wages as the U.S. approaches congressional elections in November.
“Employees today have lots of options in all corners of industry, whether you’re in fast food or retail or investment banking,” said Art Mazor, a principal at Deloitte Consulting. “This feels super tight.”
Since President Donald Trump signed a $1.5 trillion tax cut in December, several major employers have announced pay hikes or one-time bonuses. The latest came Thursday when Walmart announced plans to raise its starting hourly wage to $11 from $9 and distribute bonuses of up to $1,000. Other companies such as American Airlines, AT&T, Comcast and Bank of America have cited the tax legislation as the trigger for similar moves, drawing cheers from Republicans.
But the pace of wage growth actually has been accelerating at least since the fall of 2015. For the year ending Sept. 30, wages rose 3.2 percent compared with 2.9 percent for the same period one year earlier and 2.2 percent two years ago, according to economist Jim O’Sullivan of High-Frequency Economics.
Unemployment has been lower than the 4.6 percent rate that the Federal Reserve says is sustainable over the long term since March, which helps explain the brightening outlook for workers.
“It’s really not until unemployment drops below the full employment level that you get upward pressure on wages,” O’Sullivan said.
Employers face an especially daunting landscape in Ames, Iowa, which has the nation’s lowest jobless rate at just 1.5 percent. The local Chamber of Commerce has helped recruit workers from as far as North Carolina, while employers have doubled bonuses for employees who refer new hires, said Brenda Dreyer, the chamber’s head of workforce development.
“This is not the same world of recruiting,” she said. “You can’t do just one thing anymore.”