Labor shortage: Employers increase wages and benefits to lure workers
Ever since the pandemic shook the U.S., Peter Van Runkle has spent much of his time in meetings, usually on Zoom.
Most of these meetings are with Ohio Health Care Association members. As the association's executive director, Runkle represents the interests of each health care facility associated with OHCA.
He heard a lot of issues over the last year, but one stood out: Workers are in short supply.
Despite job openings soaring in nearly every industry, companies are unable to find employees. To attract new workers, some companies are increasing wages and benefits.
"We're getting to the point where not only is the quality of service challenged, but just the ability to keep serving people, particularly in things that involve home care," Runkle said.
He heard stories of nursing facilities being short-staffed, so they turn away new patients or ask workers to take on extra hours.
But for Runkle, this trend stretches beyond the pandemic. Health care and other industries struggled to fill employment holes even before COVID-19.
"We constantly hear our members ask, 'Where do I find the staff?'" he said.
Now, Runkle is looking for new solutions.
Thousands of jobs, few applicants
With nearly 9.3 million jobs nationally available, according to the U.S. Department of Labor Statistics, nearly every industry is asking the same question: Where did the applicants go?
Ohio Means Jobs has nearly 193,000 openings with about 44,000 available in health care.
For Runkle, there is no one reason for the staffing shortage, but he cites competitive salaries and ongoing COVID-19 concerns as the two main problems.
"When we hear things like Cedar Point offering 20 bucks an hour or we see Amazon or Walmart or whoever offering 15 bucks an hour more, then our members have really a lot of difficulties competing with that," he said.
What started as increased COVID-19 hazard pay at $15 or $18 per hour is becoming the common starting wage at nursing facilities, he said. That's up from around $12 an hour.
In addition to a wage bump, some employers have increased benefits to make health care more attractive to potential workers.
Many of the facilities Runkle represents rely on state funding to pay employees, which has operated on 2014 costs, he said.
"These costs bear no resemblance to the cost that they're paying now, so they just don't have the money to pay a higher wage," Runkle said.
Ohio's recently approved two-year budget sets aside nearly $627 million for the health care industry and its patients, plus a total of $63.2 billion Medicaid investments over fiscal years 2022 and 2023.
"I think the additional funding is enough to help with the staffing crisis, but how much impact it will have remains to be seen," Runkle said.
Manufacturing job postings jump as Ohio's unemployment increases
Despite Gov. Mike Dewine having fully reopened the state, unemployment jumped from 4.7% to 5% in May. The first time since last spring.
This is in contrast to national unemployment, which dropped by 0.3% to 5.8% or 9.3 million workers during the same month, according to the U.S. Bureau of Labor Statistics May 2021 employment report.
Among the worst affected industries was manufacturing. According to the state, manufacturing lost nearly 2,600 in April and May.
This data comes as manufacturing employers are posting jobs on Indeed at levels that outpace pre-pandemic rates.
The job hiring website reported a 76.6% jump in manufacturing postings compared to the pre-pandemic baseline in February 2020. Manufacturing employers posted 5.4% more jobs in May.
Jamie Karl at Ohio Manufacturers' Association regularly hears from manufacturers that their employment holes go unfilled.
Again, there isn't one answer, said Karl, the association's managing director of communication services.
Like in health care, competitive wages in other industries or jobs attract wouldbe employees.
"We've seen a nationwide wage increase in 2021 across the board," Karl said.
Like in health care, manufacturers have increased wages to attract more employees.
To avoid creating unwanted competition with each other, employers are coordinating their wage increases so one company doesn't gain the upper hand, Karl said.
Unemployment benefits
Members of the association often point to one culprit: COVID-19 unemployment, he said.
Ohio halted its expanded unemployment June 26, "so members are really hoping that pushes people to apply for jobs," Karl said.
The state determines non-pandemicrelated unemployment checks by halving weekly wages before taxes and other deductions.
The maximum amount one can receive is determined by the number of dependents the applicant claims. If someone earned $996 or more and has no dependents, they can earn a maximum of $498 each week. Three or more dependents can earn $672 a week.
Additional payments made from federal coronavirus relief packages allowed unemployed individuals to receive an extra $300 each week.
"Why would someone work when they could earn so much just sitting at home?" Karl asked.
Impact of immigration on restaurant jobs
Both manufacturing and health care struggled to fill holes in 2019, but this was especially true in the restaurant industry, which was largely affected by the lack of immigration reform.
"Immigrants that come to this country, they want to work hard, so they stop at a restaurant because there are no real barriers to having a career in the restaurant industry," said Homa Moheimani, spokesperson for the Ohio Restaurant Association.
In 2019, foreign-born workers were nearly 6% more likely to work in the service industry than native-born workers, according to the Bureau of Labor Statistics.
Many restaurants across the U.S. rely on foreign workers who enter the country using an H-2B visa, which allows employers to hire nonimmigrants for temporary or seasonal nonagricultural work.
The Biden Administration recently increased the maximum issued amount of these visas by 22,000 for a total of 55,000 this season.
"These supplemental visas are available only to U.S. businesses, which attest that they will likely suffer irreparable harm without the ability to employ all the H-2B workers requested in their petition," according to the U.S. Department of Labor website.
A total of 873 applications were filed to the labor department for more than 21,000 H-2B workers. 24 applicants filed from Ohio.
While the additional 22,000 visas will help alleviate some problems, Moheimani said more needs to change beyond immigration reform.
"There isn't just one issue like unemployment that causes these shortages," she said. "The circumstances are different for everyone, and someone may have found a better job at say Amazon because they were doing so well during the pandemic."
Reach Bryce by email at bbuyakie@gannett.com
On Twitter: @Bryce_buyakie