Finding Workers Is Harder Than Ever. The Economic Impact Could Be Significant

Employers hired more than 1.8 million workers in June and July. But millions of others are still on the sidelines. That's leading to long wait times and is forcing some businesses to turn down orders.

Transcript

SCOTT SIMON, HOST:

Some Americans are buying more and spending more freely now, but millions of people who were working before the pandemic aren't yet back on the job. So restaurants have to limit hours. Factories are taking longer to fill orders. And that means some companies are missing out on business. NPR's Scott Horsley reports.

SCOTT HORSLEY, BYLINE: Like a lot of employers, Dean Burrows is looking for help these days. Burrows runs a precision gear manufacturing business in Syracuse, N.Y. Over the last year and a half, a number of his experienced machinists have walked out the door.

DEAN BURROWS: Many of our employee owners have decided through the pandemic that life is too short and it would be better for them to retire earlier than they had planned.

HORSLEY: Finding replacements has not been easy. A lot of other factories in Syracuse are also trying to hire right now, and Amazon's about to open a giant new warehouse nearby.

BURROWS: We're not just competing against other manufacturers. We're competing against the McDonald's, the Amazons. So - and it becomes challenging to try to position yourself as a company that people want to come to work for.

HORSLEY: Burrows has boosted wages by about 20%, and he's offering to train less-experienced workers. Still, it's a struggle to find people, especially for the second shift, which stretches till 3 a.m. Because of that, Burrows has been telling customers they might have to wait longer for the specialty gears his company makes for cars, oil field pumps and medical devices. He's even turned down some orders out of concern he won't be able to deliver.

BURROWS: We don't want to risk our reputation because we can't find employees to be able to produce the product.

HORSLEY: Anne Boninsegna knows the feeling. She's the co-owner of an eating and event space in Columbus, Ohio, and she's had to say no to some wedding parties and bridal showers because she can't hire enough servers and bartenders.

ANNE BONINSEGNA: It's sad, and it's disappointing, especially, you know, after sitting empty for so long.

HORSLEY: Before the pandemic, Boninsegna says, she used to have lots of job applicants to choose from. Now the few people who do apply often don't show up for an interview.

BONINSEGNA: I've had lots of conversations with colleagues, and we just say, you know, where did they go? Like, did they become independently wealthy during the pandemic? People who would normally function as bartenders, it feels to me like they're all out there going to, like, festivals and traveling the country and, you know, living out their passions and stuff.

HORSLEY: That's probably a stretch. But the pandemic has changed the way a lot of people think about work. A Washington Post poll this summer found nearly 1 out of 3 workers under the age of 40 reconsidering their careers. People have been quitting low-wage jobs in restaurants and retail at especially high rates.

Some economists are not bothered by that. They say, eventually, those workers are likely to find better jobs, where they're happier and more productive. In the meantime, though, the large number of unfilled jobs is weighing on the broader economy.

SARAH HOUSE: Businesses can't sell as much if they don't have workers to either make those goods, provide those services.

HORSLEY: Economist Sarah House of Wells Fargo says if short staffing forces one restaurant to close its doors on Mondays, for example, customers might just go down the street to another dining spot. But when labor shortages are widespread, some spending is lost for good.

HOUSE: I'll give you a personal example. I was going to take my kid to the local amusement park until I talked to a friend and heard that the lines were so long because they had one worker operating two rides because they couldn't find enough staff. So we skipped that trip, and that's money that we didn't spend elsewhere.

HORSLEY: The Federal Reserve Bank of Atlanta estimates staffing shortages are costing U.S. businesses more than $60 billion a month in lost sales. Some of that business could be recovered once more people come back to work. And many forecasters were expecting that to happen this fall as vaccination rates rise, supplemental unemployment benefits run out and schools reopen, offering relief to working parents. Unfortunately, White House economist Cecilia Rouse says the latest jump in coronavirus infections could jeopardize that timeline.

CECILIA ROUSE: I'm particularly worried about schools. If schools are not able to open robustly and to stay open, it'll make it very difficult for caretakers to rejoin the workforce.

HORSLEY: In the meantime, small businesses, in particular, will continue to struggle. Anne Boninsegna worries about burnout for her stretched-thin kitchen staff in Columbus. She's pleading with her customers to be patient.

BONINSEGNA: Staffing levels are not what they were at, so if it takes a little longer to get something, there's a good reason behind it. It's not just people being lazy and not doing their job.

HORSLEY: Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright NPR.