The head of the New Jersey Department of Labor and Workforce Development – Rob Asaro-Angelo – contended that there was “zero evidence” that the $300 a week in federal unemployment relief was fueling the labor shortage befalling businesses across the nation ahead of Memorial Day reopenings.
“I’ll quote Rob: There is zero evidence, study after study, report after report, that the enhanced benefits are keeping people out of the workforce,” Gov. Phil Murphy said during his daily COVID-19 press briefing on May 26.
Business owners said they’ve struggled to build an adequate workforce as the nation weans off of the pandemic closures meant to keep the virus at bay. Those restrictions have been lifted as more than half of the nation gets fully vaccinated.
Murphy’s goal is to fully vaccinate 4.7 million adults in the state by June 3, with just over 4 million people to date having been inoculated.
But business owners warn that reopening measures could be for naught if they cannot find a large enough workforce to staff their operations.
“Most employers report that their staff will not return to work while they have the option to remain on unemployment,” said Dana Lancellotti, president and chief executive officer of the New Jersey Restaurant and Hospitality Association. “The incentive to return to a job when many are making the same or even more to remain home just doesn’t make sense.”
The benefits expire in September unless Congress and the White House opt to renew them. But Michele Siekerka, who heads the New Jersey Business & Industry Association, said that businesses run the risk of missing out on the mass influx of summer tourism dollars if they cannot get enough workers.
Data from the federal Bureau of Labor Statistics showed job gains stalling in April, during a month where the nation experienced dismal job growth. That month, the state added just 3,500 private-sector jobs, compared to 20,800 jobs in March.
Economists and public officials expected the nation to add more than 1 million new jobs in the private sector: Instead just 266,000 people were added to the labor force.
Murphy, while attempting to maintain a softer tone than his labor commissioner, still disputed just how much of a role the $300 a week was playing.
“Even if it’s possible it is somewhat of a contributor, there are a whole host of other factors: lack of child care or access to child care, schools not being fully back in person, people being flat-out concerned, afraid to get back into the mix,” Murphy said.
But labor advocates and unions contend that paltry wages and unsafe working conditions have made many Americans averse to returning to those same workplaces.
Kevin Brown, New Jersey state director for 32BJ SEIU, which represents thousands of service workers in the state, contended that a lack of worker safety during the pandemic is to blame for keeping people home.
“Employers cut corners where they can, and while they may provide some PPE [personal protective equipment], it may not be enough or with adequate frequency,” he said in an email. “There is a labor shortage because some employers are not even paying standard wage, taking away benefits. People can’t work in those conditions.
Low-wage jobs like in retail, leisure and hospitality have been especially hit by this phenomenon. But nonetheless, federal and state labor data showed that leisure and hospitality made up 3,000 of those new jobs in April.
Lawmakers are proposing a series of tax credits to help businesses absorb some of the costs with hiring, including wage increases that might need to be offered in order to hire back the workforce.