Labor market should be applauded, not lamented

Ever so slowly, people around Virginia and across America are going back to work. A constant trickle of laborers has returned to restaurants, retail outlets and offices since the worst of COVID-19 forced Americans to quit their jobs or work remotely.

Businesses, chambers of commerce and lawmakers say the hoped-for flood of workers hasn’t reappeared since before the pandemic struck in early 2020. Much wailing about vacancies continues, including at the recently concluded National Conference of State Legislatures in Indianapolis.

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Legislators from around the country suggested incentives like child care, affordable housing and mental health services as ways to lure people off the couch and back to work. All of that’s welcome.

But I don’t weep for the employers whose policies and stingy pay convinced people that risking their lives during a pandemic was foolish, perhaps suicidal. Discerning Virginians are now assessing their own cost-benefit analysis before they punch the clock again.

They want to ensure the work-family-life balance is recalibrated in their favor. They have a different perspective after watching relatives, co-workers and friends die from COVID-19; it has killed more than 1.13 million Americans and hospitalized more than 6.27 million.

That means employers have to think differently.

“If you’re someone who owns a business, man it’s tough. … You need to pay more,” Alice Louise Kassens, an economics professor and senior analyst at the Roanoke College Institute for Policy and Opinion Research, told me. “If you’re the supplier – people, households and workers – then it’s a pretty good situation.”

Folks around the state aren’t lazy, said Jay Speer, executive director of the Virginia Poverty Law Center, assailing an oft-leveled complaint. “They need stability,” he told me. “But they don’t want crappy jobs for crappy pay.”

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They’re willing to flex their muscles – and they should.

My view is the labor market should be seen as robust. The state’s unemployment rate in July was just 2.5%, slightly less than the same period in 2022 and a percentage point below the national rate. It was the most recent month available as I wrote this. Those stats should be applauded.

The labor force participation rate, which measures the proportion of the civilian population aged 16 and older that has a job or is actively looking for work, increased by 0.1 percentage points to 66.7% in July in the commonwealth.

The highest labor participation rate in the state was nearly 71% in 1992, said Timothy Aylor, a senior economist with the Virginia Employment Commission. His statistics go back to 1990. The lowest participation rate was 63.4% in June 2020, a few months into the pandemic after many workplaces had shut down.

“We don’t fully understand” why some job-seekers are still on the sidelines, Aylor told me, though “there remains a big skills mismatch between what employers need and what the unemployed have to offer.”

Kassens said employers and government officials can entice potential workers in a variety of ways.

Providing job training for work that actually exists is one method, she noted. Raising pay is another, as is making child care more accessible and more affordable for parents.

Easing immigration rules – a potential non-starter for some politicians – would also add to the labor pool, Kassens added.

One thing is clear: The canard that people would rather get jobless benefits – including $300 a week from the feds – than find work should be buried, once and for all. Those enhanced benefits ended roughly two years ago.

Some rich chamber of commerce types earlier denigrated the unemployed essentially as being lazy, and that the jobless should be pushed to return to restaurants and hotels – and risk their lives.

If those benefits had truly kept people home, though, the labor participation rate would be even higher now.

I’m not saying employers can find everybody they need. Professions like air traffic controllers and policing are truly stressed, according to a recent Axios article. “Help Wanted” signs or internet job postings are easy to find elsewhere, especially in restaurants, clothing stores and certain specialty businesses.

“Jobs are here for everybody,” Nate Phillips, a manager at a Chili’s restaurant in Chesapeake, told me last week. A sign on the front door seeking “Chili Heads” touted perks including medical benefits, help with education costs and so-called “competitive” salaries.

“The job market is hot,” Phillips continued, noting he had openings for servers, a bartender and kitchen staff. “I did four interviews yesterday.”

Yet he acknowledged people were voting with their feet, too. “Turnover is really high,” he said. Some of his employees “just get better offers.”

Fancy that.

Companies should get creative with their hiring strategies, obviously. Boost pay. Improve the working environment. Create clear management tracks for people who desire them.

That way, both employers and employees would get what they want.