Expanded unemployment benefits are hurting St. Cloud businesses
In a new survey, business owners in St. Cloud reported expanded unemployment benefits as one of the main reasons they are finding it hard to recruit workers. As reported by the Star Tribune,
More than half the respondents had up to seven open positions and a quarter had 14 or more openings — with the hardest-to-fill jobs being positions that make between $15 and $25 an hour.
Conventional wisdom holds that when a company is struggling to find labor, it can solve the problem by increasing wages or offering better benefits.
But that’s not what local companies have found, according to GSDC President Patti Gartland. About 40% of respondents said less than half of the applicants contacted for interviews this year followed through with them and less than half the applicants who were offered jobs actually accepted them.
It is important to note that most of the job openings are high-paying jobs –– well above the $15 deemed as a “living wage”.
Furthermore, a lot of evidence cements the fact that the stagnation in the labor force is not due to lack of jobs.
Between March and April, the St. Cloud metropolitan statistical area — Stearns and Benton counties — gained 1,314 jobs, or 1.3%, according to state figures released Tuesday. Meanwhile, the labor force grew by only about 240 workers.
Industries with the largest gains were leisure and hospitality, mining and construction, retail, and professional and business services. Compared to the same time last year, leisure and hospitality jobs are up 47%.
While the area has about 4,800 fewer jobs than it did in February 2020, before the start of the COVID-19 pandemic, it is still taking about 40% of survey respondents more than six weeks to fill the jobs that are open. Respondents said the shortage is causing an increased over time (50% of respondents), employee burnout and turnover (47%), the halt of expansion plans (28%), and reduced production (27%).
Some people have, of course, pointed out other issues like childcare as a possible reason people are staying home. Evidence shows that women have regained most of their job losses, and childcare is not a big issue for the remaining gap. All evidence points to the fact that people do not want to work, which should not be surprising as they are already making a lot of money with unemployment payments.