“Help Wanted” signs are everywhere you look. From the neighborhood restaurant to the corner store, it’s hard to miss them these days. You also can’t turn on the news or read the paper without seeing another story about business owners talking about having positions to fill but nobody to fill them with.
For many industries, this is the reality as our national economy emerges from more than a year under the pandemic cloud. After months of staying home and away from crowds, consumers are releasing pent-up demand in a surge of activity fueled by a boost in buying power after a year of curtailed spending and several rounds of federal stimulus.
While businesses have reacted quickly to capitalize on the economy heating up, the national workforce has been slower to flip the switch. Nationally, job openings have jumped by 2.5 million since the beginning of 2021, and the 9.3 million job openings in April were the highest level reported in two decades. In April alone, the number of job openings grew by nearly a million positions, with one in three new openings coming in the accommodation and food services industry.
These numbers aren’t entirely surprising. Restaurants, bars, hotels and the workers who staffed them bore the brunt of the pandemic’s economic impacts. Now, that the end of the pandemic is in sight, the industry has the most ground to make up. It has made notable progress. The accommodation and food services industry hired the greatest number of workers in April with 232,000 new hires, but overall employment remains 2 million workers below levels reported in February 2020.
The challenge to find willing workers may seem counterintuitive. In the early months of the pandemic, a third of Nevada’s workers were unemployed, and those jobless workers were concentrated in the accommodation and food services industry, where payrolls were cut in half. Nevada’s 7.9 percent unemployment rate remains one of the nation’s highest, and accommodation and food services workers account for four in 10 unemployment claims.
There seems to be a job for anyone who wants one, particularly in the accommodation and food services industry, so where is the disconnect?
The reasons are varied. There is no doubt that bigger unemployment checks combined with an elimination of the requirement that unemployed workers actively seek work has created a perverse incentive for many workers to remain on the sidelines. But, it is important to acknowledge that is not the only thing keeping would-be workers of the job. A number of displaced workers retired; others opted to go back to school. Many families were required to make changes to keep a parent home while schools were closed, and changing back is not as easy as flipping a switch. Other workers have delayed returning to work because they are scared of getting sick or getting someone they care for sick; and, in a troubling paradox for those wary of getting vaccinated, they will not be ready to reenter the workforce until vaccination rates climb closer to herd immunity levels.
Whatever the reason, it’s a seller’s market for the labor force. Businesses desperate to fill positions are offering higher wages and hiring bonuses to attract candidates, and workers are taking advantage of the competitive environment. Not only are they reentering the workforce with better pay prospects, they are also quitting jobs at the highest rate in recent history.
And the industry with the highest quit rate is, you guessed it, the accommodation and food services industry, with a quit rate that is twice the overall average. That explains all those “Help Wanted” signs in restaurant windows.
The current labor market dynamics undoubtedly create headaches for many businesses looking to hire employees. But those dynamics are a temporary symptom of an economy that is rapidly emerging from a devastating pandemic-induced recession. The labor supply-demand balance will normalize, likely in the fall once schools are back in session, unemployment programs return to normal and vaccination rates are even higher. Until then, there will be plenty of jobs available for the workers who are ready and willing to get back to work. That’s a very good place to be considering where we were just a year ago.
Members of the editorial and news staff of the Las Vegas Review-Journal were not involved in the creation of this content.