Businesses scramble as job openings go unfilled
NEW YORK — It looks like something to celebrate: small businesses posting “Help Wanted” signs as the economy edges toward normalcy. Instead, businesses are having trouble filling the jobs, which in turn hurts their ability to keep up with demand for their products or services.
Owners say some would-be workers are worried about catching COVID-19 or prefer to live off unemployment benefits that are significantly higher amid the pandemic. Child care is another issue — parents aren’t able to work when they need to tend to or home-school their children. For some people, a combination of factors go into their decision not to seek work.
When Steve Klatt and Brandon Lapp set up interviews for their restaurant and food truck business, they’re lucky if one out of 10 or 15 applicants comes in.
“The people who do show up, all assume their unemployment is running out,” says Klatt, whose business, Braised in the South, is located in Johns Island, South Carolina. The maximum weekly unemployment benefits in the state are $626 including $300 in federal coronavirus relief payments; in some states, maximum unemployment is over $700 a week.
Businesses of all sizes are struggling with hiring even with millions of Americans unemployed and as increasing numbers of people get vaccinated and look forward to a more normal life. A Census survey taken in late March shows 6.3 million didn’t seek work because they had to care for a child, and 4.1 million said they feared contracting or spreading the virus.
But smaller companies that often can’t offer pay and benefits as generous as larger companies have a tougher time.
“A shortage of talent is nothing new for small businesses, but the circumstances surrounding this shortage are entirely different,” says Jill Chapman, a consultant with Insperity, a human resources provider.
The National Federation of Independent Business found in a March survey of its own members that 42% had job openings they couldn’t fill. Owners cited higher unemployment benefits as one factor. And a study released last month by the National Bureau of Economic Research found that a 10% increase in unemployment benefits during the pandemic led to a 3.6% drop in job applications.
“Unemployment benefits allow workers to be able to wait longer before they take a job, which can make hiring harder,” said Ioana Marinescu, a University of Pennsylvania professor who co-authored the study.
Companies whose work is done inside homes — including plumbers, contractors and pest control businesses — find many prospective hires are afraid of contracting the virus on a job. Meanwhile, demand for their services is up because there’s more wear and tear on houses and apartments as people spend more time at home.
Child care is one reason why the pool of available workers has shrunk dramatically at Let Mommy Sleep, which hires nurses and health aides to provide in-home care for babies and give new mothers a respite. Founder Denise Stern says some of her caregivers want to work overnight and sleep during the day, but if they have their own children to care for, that’s not possible.