Many jobs but few candidates, the new crisis that is targeting the United States

Getting employees has become a difficult task in the United States, where many workers decline some positions or even resign from the positions they occupy, which shoots up wages and threatens growth.

Retail sales, transportation, manufacturing, childcare … Employers in many industries have trouble hiring, particularly when it comes to jobs at the bottom of the pay scale.

This “reflects the aging of the workforce, changes in the types of jobs that people want and the time needed to train workers,” reflected on Wednesday one of the governors of the Federal Reserve (Fed, central bank), Randal. Quarles.

“Difficulties in caring for children and the obligation to get vaccinated were widely cited among the causes of the problem, as well as absences linked to covid,” the Fed explained on Wednesday in its economic report known as the “Beige Book”, which carried out based on a survey among companies in the country.

Despite the reopening of schools, they are places in the nurseries that are lacking. These establishments, most of the times private and very expensive in the United States, are unable to hire staff, and must reduce their locations and increase rates.

In addition, fears of contracting covid remain high in a part of the population.

And the obligation to be vaccinated to work in some companies or sectors can stop the most reluctant, although the number of resignations linked to this requirement was lower than expected according to the companies interviewed, for example, in Minneapolis.

With offer in hand

Result: the expiration, on September 6, of the expanded unemployment benefits that were distributed since the beginning of the pandemic was not accompanied by a run towards jobs as expected, many businessmen highlight.

There are still 3 million workers to return to the level of the economically active population (EAP) that was registered before the crisis, according to data from the Labor Department.

It is “unlikely”, according to Randal Quarles, that the participation in the labor market, 61.6% in September, will return to the level of 63.4% in February 2020, before the pandemic slowed down many activities economic.

Executives in the Philadelphia region even estimate that “operational changes and automation will allow their companies to operate with fewer workers,” the Beige Book states.

A New York-based employment agency noted, however, that it expects an increase in hiring, currently “moderate,” as people return to offices in greater numbers.

At the moment, “many candidates arrive at the (job) interview with another offer in hand,” detailed the Fed.

That puts pressure on companies: salaries, hiring bonuses, health insurance, better working conditions. Everything is part of the package.

Rising wages

CVS pharmacies, Target stores, Chipotle restaurants, or the giant Amazon, among others, exceeded $ 15 an hour at the time of hiring, double the federal minimum and the figure that President Joe Biden wanted for the national minimum wage .

Biden resigned his goal amid strong opposition in the Senate.

Treasury Secretary Janet Yellen welcomed the need for small American businesses to raise wages to attract labor in the face of competition from large groups.

“They should, perhaps, pay more. (…) But it is a good thing for the workers, “said Yellen, asked about the possibility that restaurants, for example, offer higher salaries than those proposed by commercial giants such as Amazon, who hire massively.

“Many workers in the service sector have always low wages and insufficient working conditions and social benefits,” he said.

The median hourly wage in the United States went from $ 28.52 in February to $ 30.85 in September 2021, according to the Department of Labor.

But for companies, large or small, that fail to seduce candidates, the activity is reduced.

“Many companies in the distribution, hotel and manufacturing sector reduced their hours or production because they do not have enough workers,” detailed the “Beige Book”.

Ultimately, it is growth that is harmed, with a slower cadence at the beginning of the boreal autumn, “penalized” by this lack of personnel, to which are added global supply difficulties and fears related to the impact of the variant delta. (I)