business news in context, analysis with attitude

The Wall Street Journal reports this morning about how "the tight labor market is hampering new restaurant and supermarket openings, putting a potential check on growth in a food industry that is being reshaped by the pandemic.

"Many food sellers are adding stores to capitalize on high consumer spending as Americans emerge from a year spent largely at home. But grocers and restaurants say they are struggling to hire all the workers they want for these stores. They are adding perks and bonuses to entice job seekers and in some cases delaying openings."

According to the story, "Grocery and restaurant executives say expanded unemployment benefits and federal stimulus checks are making it harder to find people willing to work at their stores. Surveys have shown some people say they aren’t working because they worry about spreading or contracting Covid-19. Those concerns are acute in restaurants and supermarkets, where workers are indoors and interact with customers and colleagues who in many cases aren’t wearing masks, as vaccination rates climb and companies relax their rules. Some companies say potential workers are staying out of the job market for now because of concerns about the safety of working in public during the pandemic or child-care duties."

However, the Journal writes, "the worst of the labor crunch could prove temporary. Enhanced and extended unemployment benefits end nationwide in September, and some states are stopping them sooner. Many schools and daycare centers are expected to fully reopen by fall, allowing parents to return to work, and with vaccines widely available, more Americans could feel comfortable working outside their homes."

But, "food executives say higher costs for pay and benefits, as well as the hassle of deploying existing staff to new stores, are weighing on operations, potentially preventing them from grabbing more sales."

KC's View:

Retail executives like to say that we'd all be better off if increases in the minimum wage were left to the demands of the marketplace as opposed to being determined by legislative action.  In some ways, that's what happening now … though not entirely, since the extended unemployment benefits are an act of government that are having an impact on the employment situation.

That said, we've just gone through a year in which the pandemic had a tectonic impact on the lives and careers of almost everybody.  It may take some time for things to regain a sense of balance.

That said, it may be that in some cases, some workers are feeling a little betrayed by the companies where they worked.

Fast Company has a story based on a preliminary report from the Economic Policy Institute, which each year reports on CEO compensation trends based on data from the 350 largest firms:

"At the start of the pandemic, some CEOs announced, to much fanfare, that they’d give up their salaries in order to protect their companies from layoffs or closures. But those gestures did little to curb the trend of soaring CEO earnings (because salary is often just one component of CEO compensation). In 2020, what CEOs took home rose nearly 16%, according to preliminary data, while the average worker’s compensation rose just 1.8%."

It may be that some employees are looking at that disparity and are wondering why they're being demonized by looking out for themselves and their families.

And, by the way, these are the same employees called "essential" not too long ago.  It may be that they are demonstrating exactly how essential they really are.