By Leonard A. Robinson
Millions continue to utilize unemployment benefits despite an abundance of available jobs and a sustained decline of jobless claims.
Jobless claims have continued a steep decline over the past few weeks. 473,000 Americans filed jobless claims in the week ending May 8, down from 507,000 a week prior, according to the Labor Department. This rate is the lowest since the pandemic, although it is higher than before the pandemic.
The Labor Department further reports roughly 100,000 people filed claims under the Pandemic Unemployment Assistance Program, a program that extends traditional unemployment benefits to independent contractors, during the week of May 8.
On May 12, Forbes reported that numerous states, including Alabama, Missouri, Wyoming, Idaho, and North Dakota, announced that they would be ending federal unemployment benefits. Some states, like Iowa, reinstated work search requirements in the fall.
Meanwhile, employers have struggled to find workers to meet the rising demand caused by coronavirus restrictions being lifted and vaccination rates climbing.
Numerous economists believe additional unemployment benefits – passed as part of the latest coronavirus package – are the culprit for more available positions than workers.
Bram Kleppner, CEO of Danforth Pewter, a metal works company, had to adjust to the issue after Connecticut made it easier to earn unemployment benefits.
“We are now trying to figure out how we navigate an environment in which people get paid more to stay home than they do to go to work,” said Kleppner.
Economist Ann Elizabeth Konkel and others believe otherwise.
“I certainly have heard the anecdotes of cases where workers are earning more on unemployment than at a job,” said Konkel. “I think it’s incredibly difficult to parse out how much that is happening and if that is driving the bigger trend because we have the public health question, the childcare question.”
Service industry businesses, such as restaurants and bars, have seen the bulk of the shortages.
Some business owners believe that the solution to hiring woes can be found in hiring teenagers. Restaurants traditionally employed more than a quarter of working teens. However, other restaurateurs say the shortfall is mainly in the back of the house positions, like dishwashers and cooks, that are not quite attractive to young people.
“Most teenagers, if they’re applying, I don’t think they want to work in a kitchen,” said Andy Diamond, president of Angry Crab Shack, a seafood chain. “If they’re applying, they’re looking for 15 to 20 hours a week, and that’s most likely front of the house.”
Throughout the pandemic, teens have become more vital members of the working force. Many began working after classes shifted online, breadwinners became ill, and companies began to have more open positions to accommodate newfound flexibility.