The U.S. economy finds itself in the midst of an odd contradiction. While nearly 10 million people are looking for work, businesses from across the country and in a variety of industry sectors report a shortage of willing workers. Normally, people who want work and businesses who want workers find one another, but that is not happening now.
The problems seem most acute in a couple of areas. The first are in-person service sector jobs. People do not seem as interested in working in convenience stores, restaurants and similar settings as they were in the past. A second area of dramatic shortage is for truck drivers. The nation desperately needs more truck drivers to move goods around the country. There simply are not enough of those workers today, and that creates the risk of supply disruptions — ones our nascent economic recovery cannot afford.
One big question is why. An unhealthy combination of factors seems to be driving the labor shortage. One of those factors is the fear of contracting COVID-19. Working can bring increased risk of exposure to other people and, by extension, COVID. That may explain why restaurants and stores, in particular, are feeling the strain. Those jobs require interactions with members of the public and that brings a perception of risk. For some people, it may not be a risk they are willing to take at this time.
Caring for family members might also be pulling people out of the job market. With many schools still not meeting in person and families having made changes over the past year to figure out how to care for elderly or otherwise vulnerable family members, people who might otherwise work still may be needed more at home.
Of course, all of that may be compounded by economic incentives. Unemployment payments remain higher than normal. Many unemployed people may be receiving nearly as much (or, in some cases, more) for not working than they would working. While that might not last forever, it may be keeping some people home for now — or, at least, until they can get vaccinated or otherwise feel less concerned about the COVID risk. One study, published in August, found a three percent decrease in jobs applied to for every 10 percent increase in jobless benefits.
Under normal circumstances, this relationship may be more attenuated, but the widespread difficulties businesses have finding willing workers suggests that these factors are combining in a problematic way for the economy. Typically, the answer to this type of shortage would be increasing wages. But many businesses report that even large increases have not attracted enough workers. Somehow, we need people working for the economy to pick up.
That leads us to the other big question — what to do about all this. One of the answers may simply be making more progress with vaccinations. Giving people confidence that life should return to its more normal patterns would clearly help. More vaccinations should also allow schools, day care centers and other services to get back to in-person operation.
Another idea that was in the mix during the last Congress but never made it across the finish line could hold promise. Last year, Sen. Joni Ernst, Iowa Republican, introduced the FRNT LINE Act and Reps. Glenn Thompson, Pennsylvania Republican, and Dwight Evans, Pennsylvania Democrat, introduced the AG CHAIN Act. Both bills would have provided income and payroll tax relief for essential workers. The idea behind them was to reward people financially for getting back to work in areas such as food service and food and fuel transportation that all of us need to continue without interruption.
Creating this type of incentive program would do two things. One is, of course, that it would provide a direct financial incentive to get back to work. But the other may be just as important. It would send a strong, official signal about the societal importance of working and doing these jobs.
A year ago, it was commonplace for people to voice the appreciation they had for the everyday workers who were showing up to ensure shelves were stocked, gas could be found at the pump and the like. That sentiment has dissipated. We need it back. We need to be clear about the importance and dignity of work — especially in essential industries. If we don’t find a way to send that message and get people back to work, our economy will lag.
• Lyle Beckwith is the senior vice president of government relations at the National Association of Convenience Stores.