Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Employers Are Baffled as U.S. Benefits End and Jobs Go Begging

EconomySep 20, 2021 20:22
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

(Bloomberg) -- Emergency unemployment benefits in the U.S. expired two weeks ago, but employers who expected an increase in job applications are still largely waiting for them to roll in. 

Federal programs that had offered an extra $300 per week for jobless Americans, provided extended benefits for the long-term unemployed and gave special aid for the self-employed expired Sept. 6. Economists and companies expected a wave of interest from workers as the financial lifeline was pulled away, hoping it would provide the incentive to get back into the workplace. 

That hasn’t happened, according to employers across industries.

“People who have been on the sidelines have by and large stayed on the sidelines,” said Richard Wahlquist, president of the American Staffing Association, the country’s largest recruitment-industry group. “Nothing has changed in regard to the benefits that have fallen off and the need for people continues to grow.”

Even Wahlquist is struggling. He’s looking for 10 temporary workers to help at the organization’s conference in Denver at the end of the month, paying as much as $25 an hour. So far, he could only rustle up two. 

Across the country, staffing firms and businesses have yet to see a marked uptick in employees. Goldman Sachs Group Inc (NYSE:GS). economists forecast that the expiration of the federal program this month, which affected about half of U.S. states after the rest ended benefits early, would add 1.3 million people to payrolls by year-end. Other analysts said an end to the federal program should increase labor supply. 

Jobless claims for the week ended Sept. 11 showed an increase in people seeking benefits, though the effects of Hurricane Ida affected the data. In the meantime, the great labor shortage isn’t letting up, with a record 10.9 million job openings in July. 

“We’re only going to see the impact of the federal UI benefits ending a couple of months from now -- I don’t think we’re going to see a big spike one way or another really,” said AnnElizabeth Konkel, an economist at Indeed Inc. “We thought things should be better by Labor Day and they’re not.”

One reason could be pent-up savings, according to Daniel Zhao, senior economist at Glassdoor Inc. Stimulus checks, boosted unemployment benefits and expanded social safety nets drove the savings rate to a record 34% last year, and it remained elevated at 9.6% in July. 

Joanie Bily, chief workforce analyst at Atlanta-based EmployBridge, was one of the people who thought that her company would see a “significant increase” in the number of online applications once boosted benefits ended.

“I’ve been asking all of our locations across the U.S.: ‘Are you busier? How does it feel since the benefits have ended?’” said Bily, whose firm connects employees with companies across the U.S., focusing on manufacturing, logistics and call centers. “I pulled the data last night and I thought it would be better, but it’s not.”

Applications increased about 10% in the two dozen states states that ended emergency benefits early -- but that was also a boost that lasted only a few weeks, she said.

In the company’s offices in California, the most populous state with recently ended benefits, managers told her there is a slight boost in inquiries for administrative work but “it’s too soon to tell.”

In the restaurant industry, job applications have declined about 3% to 4% each week for the past nine weeks, including the period following the expiry of boosted benefits, according to Restaurant365, a restaurant-management software company.

That’s “contrary to many predictions that aid was the primary factor keeping restaurant workers out of the workforce,” said Tony Smith, CEO and co-founder of the company.

The reasons for the missing workers are many: childcare barriers, a skills mismatch, health concerns -- particularly for service-industry jobs and a mass reallocation of work as people reconsider careers.

“As people look at their bank accounts and realize we’re coming to the holiday season, we hope people have more incentive to come back,” said ASA’s Wahlquist.  

©2021 Bloomberg L.P.

 

Employers Are Baffled as U.S. Benefits End and Jobs Go Begging
 

Related Articles

Yellen Defends Powell’s Regulatory Record
Yellen Defends Powell’s Regulatory Record By Bloomberg - Oct 26, 2021

(Bloomberg) -- U.S. Treasury Secretary Janet Yellen defended Federal Reserve Chair Jerome Powell’s record on regulating the financial system amid attacks by progressives seeking to...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email