From fast food restaurants to manufacturing companies, employers across the country are struggling to fill positions once vacant due to the COVID-19 shutdown.
Return-to-work hiring slowed sharply in August and the workforce is still 2.9 million fewer than in February 2020. Despite the fact that a record 10.9 million jobs remain vacant , according to the Bureau of Labor Statistics, 8.4 million people of working age are unemployed.
While dominant views tend to focus on the impact of the labor shortage on the economy as a whole, in terms of GDP and market projections, experts in Catholic economic thought express their concerns about the employment crisis in terms of its impact on human beings.
âHuman growth requires participation in the communities in which you live,â said Charles Clark, senior researcher at the Vincentian Center for Church and Society at St. John’s University and professor of economics. While not the only form of community engagement or work, Clark says “paid work is an important part of participating in our society.”
Catholic social educator Michael Naughton agrees, describing work as “a deeply human reality.” He adds that work enables people to exercise their divine gifts in order to “contribute to the good of society and become the people for whom we were created.”
Naughton, who heads the Center for Catholic Studies at the University of St. Thomas, says that beyond the negative impact of labor shortages on the productivity of organizations – which affects everything from the global supply chain to significant drops in profits – it is also fostering a form of “institutional poverty”. Not entering the workforce reduces an important source of belonging and participation for many, especially those who do not have strong ties to other institutions, such as the family or the church.
In this sense, the pandemic-induced labor shortage is exacerbating what was already a steady downward trend in institutional participation – especially among men.
In his 2016 book Unemployed men, Catholic political economist Nicholas Eberstadt described the already declining rates of male labor market participation as “America’s invisible crisis.” Likewise, in a September article titled âA Generation of Men Drops Out of Universityâ, The Wall Street Journal reports that men currently lag behind women in college enrollments at record levels.
Naughton points to a particularly disturbing finding, at least in part linked to declining institutional participation: rising suicide rates, especially among middle-aged men.
“We are social by nature – institutional animals – and when we break away from our nature and our institutions, we pay a significant price,” said Naughton, who sees the current labor crisis as both a product and a contributor to the world. broader cultural issue. declining participation.
Role of grants
A number of factors are contributing to the labor shortage, from pandemic concerns over personal health to rising child care costs.
But some also wonder whether government grants to help those who found themselves unemployed during the pandemic have been excessively extended, suppressing labor market participation beyond the peak of COVID-19 closures.
Additional federal unemployment assistance, initiated by President Donald Trump through the CARES Act and extended by President Joe Biden, took the form of weekly checks of $ 300 (up from $ 600 initially). This additional relief ended on Labor Day, after totaling $ 800 billion in aid to the unemployed.
Naughton believes the government played “an important role” during the worst of the pandemic when it intervened to help both workers and organizations.
“But like all well-intentioned programs, there are always unintended consequences,” he says, claiming that continued government assistance in the context of broader “institutional impoverishment” has contributed to government dependency and reduced incentives to work.
“Companies that had to put employers on leave often struggled to get them back, in part because the UI was equal to or greater than what they were getting from the company,” said Naughton, who sits on the board of directors of several companies and non-profit organizations. .
However, other Catholic economic experts do not believe COVID-19-related unemployment relief has contributed to the labor shortage. Clark in St. John’s, for example, points out that states that ended supplemental federal assistance early did not see a corresponding increase in their workforce.
Clark says this is consistent with âbasic incomeâ experiments, which show that providing people with a base of financial support does not reduce labor market participation – with the exception of married women with children, âwhich could be beneficial, because they just have something so important to do.
“I think when all the research is done on this period, we will see more evidence that cash benefits do not harm workers. [participation]”Clark said, adding that expanding government unemployment benefits in terms of amount and qualification was” the right move. “
Push against the system
Workers may be dissuaded from returning to work, but some data suggests this may be less a product of government assistance, and more deeply related to dissatisfaction with labor market realities, including stagnant wages and long hours.
A report of The Washington Post said the United States was not so much experiencing a labor shortage as it was “a great re-evaluation of work.” An editorial in The hill, was even more adamant, claiming that American workers are on a âprolonged general strikeâ.
âMillions of people refuse to return to low-paying jobs without benefits that force them to give up their dignity and rights in the workplace,â wrote Lane Windham, associate director of the Georgetown Kalmanovitz Initiative for the labor and the working poor. Possible indications of this trend are an increase in minimum wage expectations and a strong desire to change careers for a better work-life balance.
Naughton and Clark both agree that long-standing injustices in the workplace and in the economy have contributed to the labor shortage. Naughton says the relationship between corporate earnings and wage increases “has long been out of whack”, while Clark says a reassessment of the relationship between work and business is “long overdue.”
âA pandemic will cause a lot of people to rethink their priorities,â he said of some workers’ reluctance to return to work. He added that some economic commentators, in their reluctance to tackle wage stagnation, “resemble the 17th century mercantilists who stressed the need to keep workers in poverty so that they are motivated to work hard.”
Clark also adds that the labor shortage may indicate a need to focus more on connecting workers with suitable jobs instead of just treating them as a raw material to be used to fill a void, and asserts that an increase in enrollment in community colleges could be beneficial.
Naughton says, however, that the labor shortage – and its underlying causes – is not a “neither / or a situation.” It stresses the need to take into account all factors, including working conditions and wages, the role of government benefits and the cultural situation at large.
On that last note, he worries about a “work ethic problem”, especially among young Americans.
“So when a pandemic strikes and they find ways to exit the world of work, they do it.”
Economists and business owners will be waiting to see how the number of workers evolves in the coming months, especially with 7.5 million Americans no longer receiving COVID-related unemployment assistance from the federal government.
But for now, âHelp Wantedâ signs remain in store windows across the country – indicating a labor shortage, yes, but also a social and cultural deficit.