“If our farmers can’t have the workforce they need, which many cannot, and don’t have access to -we need to fix that and change it,” said Rollins.

Speaking with reporters in Nebraska earlier this week, she said the USDA and the Departments of Labor and Homeland Security are aggressively exploring ways to ensure a reliable and lasting workforce.

She says that includes creating a process that would allow farmers to hire undocumented employees who would need to self deport and return legally. “Our teams are meeting and are figuring out how to make that a reality, what that looks like and what the timeline looks like.”

But, Rollins says, the best solution will ultimately need to come from legislation in Congress.

Source:

Between the fourth quarters of 2019 and 2021, the labor-force participation rate—the share of the population ages 15 to 64 either working or looking for work—dropped 0.7 percentage points in the U.S., while rising in Japan and Canada, according to the Organization for Economic Cooperation and Development. The eurozone’s participation rate was also above its pre-pandemic level in the third quarter, which is the latest data available.

While much of the decline in U.S. labor is because of retirement, its participation rate for people ages 25 to 54 has also fallen more than in other countries.

The sources of this discrepancy could help answer another question: Why is U.S. inflation higher than in other countries? It appears to be a combination of stronger demand and more constricted supply, including supply of labor.

One cause is differing approaches to supporting workers during the pandemic. European governments historically sought to keep workers in their jobs during downturns, and Japanese companies have long given priority to preserving head count. The U.S. has instead supported laid off workers directly, facilitating the transition to new jobs and new industries.

During the pandemic, European and Japanese employers furloughed rather than fired employees, with governments subsidizing the furloughed workers’ salaries.

The U.S. had the Paycheck Protection Program, which gave forgivable loans to businesses that held on to their employees, but the impact was relatively small. Most federal support came through enhanced unemployment insurance for millions of laid-off workers.

As a result, bonds between employers and employees were more likely to be severed in the U.S. than in Europe.

Differing wage subsidies, however, can’t explain why labor participation is lower in the U.S. than in Canada, where the subsidy plan was similar to the U.S. plan.

Here, COVID-19 may have played a role. Cumulative infections and deaths from the virus are about three times higher, per capita, in the U.S. than in Canada—almost certainly affecting the willingness and ability to work.

U.S. monthly labor-force surveys show the number of people absent from their jobs because of illness averaged 50 percent higher last year than in 2019. Over the same period, Canada’s corresponding survey showed 16 percent more workers missing a full week of work because of illness or disability, and 13 percent fewer missing part of a week.

Source: Wall Street Journal

As the economy reopens, the process of matching laid-off workers to jobs is proving to be slow and complicated.

The disconnect helps to explain why so many companies are struggling to fill open positions. It also helps to explain why wages are rising briskly even when the unemployment rate, at 5.9 percent in June, is well above the pre-pandemic rate of 3.5 percent. (The relatively high jobless rate suggests an excess of labor supply that in theory should hold wages down.)

Several factors are behind the development: Many workers moved during the pandemic and aren’t where jobs are available; many have changed their preferences, for instance pursuing remote work, having discovered the benefits of life with no commute; the economy itself shifted, leading to jobs in industries such as warehousing that aren’t in places where workers live or suit the skills they have; extended unemployment benefits and relief checks, meantime, are giving workers time to be choosy in their search for the next job.

“The labor market is a matching market where you need to choose something and be chosen by it,” said Julia Pollak, a labor economist at ZipRecruiter Inc., an online employment marketplace.

A recent ZipRecruiter survey found 70 percent of job seekers who last worked in the leisure and hospitality industry say they are now looking for work in a different industry.

In addition, 55 percent of job applicants want remote jobs. An April survey of U.S. workers who lost jobs in the pandemic, conducted by the Federal Reserve Bank of Dallas, found that 30.9 percent didn’t want to return to their old jobs, up from 19.8 percent last July.

Source: Wall Street Journal

Now that most pandemic restrictions have been lifted, Americans are back to dining out and booking vacations—and business owners are looking to fill nearly 1.6 million openings, a 68 percent increase in openings compared to February 2020.

Contrast that narrative with the manufacturing industry.

Some 1.4 million people were laid off or furloughed from February to April 2020. But as of last month, business owners are hiring for 851,000 positions—a record high for the industry and a 112 percent increase in openings since last February.

Manufacturing firms “are desperate for workers, and they would take anybody in off the street and help them learn what they need to know to start,” said Carolyn Lee with the National Association of Manufacturers.

The record rate of openings in the industry comes as 1.7 million workers over 55 unexpectedly retired during the pandemic, according to a recent report published by the Schwartz Center for Economic Policy Analysis.
Health concerns likely played a big role in pushing older Americans to retire during the pandemic, the report said.

The trend has been particularly troublesome for the manufacturing industry where the median age for workers was 44.4 in 2020, two years higher than the overall median age across all occupations, according to data from the U.S. Census Bureau.

“We definitely have an older workforce,” Lee said. “People are leaving the top end of the funnel, and people [are] not coming in and behind to replace them.”

The biggest hurdle the industry faces is attracting younger workers who either aren’t aware of job openings in the industry or have no interest in joining the sector—a product of a “perception gap,” Lee said. “People don’t know that these are jobs that are available or that these are jobs they’d want.”

What’s more, women made up just 29 percent of all manufacturing jobs in May 2021 even though they comprise nearly 50 percent of the workforce, according to BLS data.

That’s not a coincidence considering “we as a society foster from kindergarten: ‘OK girls, you play with the pink doll set and boys, you can have the hardhat and the digger,’” said Nicole Smith, chief economist at Georgetown’s Center on Education and the Workforce.

That has contributed to a significant PR problem in infrastructure and manufacturing where women are convinced that every job requires heavy lifting and a hardhat, Smith added.

Retirement and PR problems aside, some manufacturing firms complain that labor shortages, which employers across the board are confronting, are the reason there’s a record number of openings.

Over the past two months, some 837,000 jobs were added—far below the 1.6 million jobs economists forecast for April and May. Meanwhile, there were 9.3 million unfilled positions in the U.S. in April, according to the Department of Labor’s Job Openings and Labor Turnover Survey.

That’s equivalent to the number of people who are currently unemployed, according to the latest jobs report.

As a result, they’re prematurely cutting some 4 million jobless recipients off from enhanced benefits in the coming weeks—months before they expire in September.

Anecdotally, Lee said she has heard that some applicants are telling manufacturing employers that they’re waiting until enhanced unemployment benefits end in their state before they start a new job, but there’s “no definitive proof” of that.

Source: MarketWatch

At least 19 states recently decided to prematurely cut off the sweetened aid, which provided an extra $300 a week on top of regular state unemployment benefits. The supplemental benefit is not slated to expire until Sept. 6.

Alabama, Alaska, Arizona, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, North Dakota, Ohio, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia and Wyoming announced they will stop giving unemployed workers an extra $300 in benefits some time over the summer.

The new measures come in light of the Labor Department’s April payroll report, which revealed the economy added just 266,000 jobs last month—sharply below the 1 million forecast by Refinitiv economists.

Some lawmakers were quick to blame the extra unemployment aid for the lackluster job growth, although experts have also cited a lack of child care and fears of contracting COVID-19 for the hiring shortage.

There remain about 8.2 million fewer jobs than there were in February 2020, before the pandemic shut down broad swaths of the nation’s economy.

“It has become clear to me that we cannot have a full economic recovery until we get the thousands of available jobs in our state filled,” Mississippi Gov. Tate Reeves said in a tweet.

The average state unemployment benefit is about $330 per week. With the federal supplement, Americans are receiving about $630 in weekly unemployment benefits. (For comparison’s sake, that’s about $32,000 annually, or roughly double the nation’s minimum wage.)

Source: Fox Business

“In talking with my guys that do the welding for us …, they said it all goes back to the steel mills,” said Nic Beck of Carks Ag Supply in Nebraska. “It’s not a shortage of iron ore. It’s not a recycled steel shortage. It comes down to labor.”

In the Pacific Northwest, a TikTok video from farmer Shay Myers went viral after he pointed out 350 pounds of asparagus that was on the verge of going to waste.

“We can’t get the labor,” he said on the video. “We can’t get people to show up and do the work for $16 an hour, with housing, transportation and all of those things.”

Myers said challenges at the border are costing him his workforce, but it is one among many factors. Also in play: a shortage of truck drivers.

The California Farm Bureau says during carrot and onion harvests in South California, they are seeing up to 30 percent fewer drivers than before the pandemic.

“In order to alleviate some of the shortage, we need to get President Biden to enact the Stafford Act, as Donald Trump did last year,” says Joe Antonini with Antonini Enterprises. “This would allow the weights of the loads to go from 80,000 pounds maximum to 88,000 pounds, a 10 percent weight tolerance. Given that, there would be some relief on the amount of drivers needed to bring in the harvest.”

Not everyone sees it that way. Purdue University’s Jayson Lusk says there’s not necessarily a worker shortage in the U.S.

“It’s a little perplexing,” he said. “You mentioned the word ‘shortage.’ If you actually looked at data on employment, there’s actually a lot fewer workers in the restaurant industry, and a little bit fewer workers in food manufacturing and in grocery retail. So that would seem to suggest, well, we don’t really have a shortage.”

The Bureau of Labor Statistics data shows wages and earnings have increased significantly, especially in the grocery and retail food sectors.

“Wages are getting pulled up, so you would think that would pull more workers into those sectors. But we’re not really seeing that at the moment. That’s really where this perception of a shortage comes from,” Lusk said.

The Associated Press last week reported a record number of available jobs in March, illustrating starkly the rush of businesses seeking to find new workers as the economy expands. Yet total job gains increased only modestly, according to a Labor Department report.

The data comes after the April jobs report that fell short of economist expectations, largely because companies appear unable to find the workers they need. Data shows it’s not a shortage of workers, it’s a shortage of people willing to work.

“That is the natural question: why? Why are people (not) showing back up at work? And I think there are several possible explanations,” he said.

In the latest Kansas City Federal Reserve Manufacturing Report, one manufacturer said, “Stimulus and increased unemployment money are wrecking the labor pool.”

Today, someone with a $15-per-hour job, working 40-hour weeks, would bring home $600 a week. However, in Kentucky, the maximum unemployment pay is $569 per week, plus the extra $300 per week passed in the Biden administration’s American Rescue plan. In Kansas, those who were getting $488 for unemployment before, are now getting $788 with the added federal benefit. The numbers show instead of getting paid to work, some Americans can make more money by simply not working at all.

“I haven’t seen empirical estimates of the effect, but it has to be having some effect,” Lusk said. “If people can stay at home and make something similar to what they might at work, that’s going to keep people out of the workforce.”

Source: Farm Journal Report