Why are businesses having trouble hiring employees?

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Why are businesses having trouble hiring employees?

You’ve all seen them, businesses plastering hiring signs all over the area desperately searching for employees to help fill their vacant positions created by the pandemic.

Some businesses have raised their starting wages and even offered sign-on bonuses to help attract workers, but many places are still struggling to reach full staffing as COVID-19 orders have been lifted and capacity levels are allowed at 100 percent.

Some businesses have been forced to cut hours and even entire days due to poor staffing. Your Place restaurant announced that they are closing their Hershey and Mechanicsburg locations every Tuesday due to staffing shortages.

With the pandemic orders beginning to lift nationwide, and unemployment rates still at record-high levels, the question still remains: why can’t businesses fill jobs?

Some people are blaming the boosted unemployment benefits as the reason why people aren’t coming back to work. President Joe Biden signed the American Rescue Plan into law in March of 2021, which extended the boosted unemployment benefits to September 4, 2021. This plan pays individuals on unemployment an extra $300/week, which was put in place at the early stages of the pandemic to help prop the economy up while businesses were shut down.

Now that businesses are back to full capacity, some individuals argue that the extra unemployment benefits are hurting businesses’ ability to attract new workers. Governor Wolf was asked about this possibility back in April of 2020, and he stated that “as a former business owner, if you ever face that kind of situation, there’s one really simple thing you can do as a business owner and that is raise the compensation of your employees.”

Compensation levels have been slowly rising, with businesses having to raise their wages well above Pennsylvania’s $7.25 federal minimum wage. Many businesses have been forced to raise their starting wages to above $10/hour to compete in the job market.

Governor Wolf’s office addressed the issue in a statement Tuesday, saying “many Pennsylvanians are still waiting to complete the full vaccination process, or are facing other pandemic-related challenges that prevent them from rejoining the workforce, such as children remote learning from home or a lack of child care. Others are reconsidering their career options and placing a higher value on pursuing higher-quality jobs that pay higher wages, or might require upskilling or training. Pennsylvanians who are ready to return to the workforce are already being enticed to certain employers or industries who are offering longer-term stability through higher wages, benefits, signing bonuses, and other contributions.”

Many businesses have been hosting hiring events all over the Midstate, some promising to hire individuals on the spot. Some have been offering small incentives just for attending the event, such as free food at some restaurants.

Pennsylvania’s unemployment rate stood at 7.4% in April, up almost three percent over the rate in April 2019, but below the record-high numbers seen in April 2020. With more and more individuals getting vaccinated every day, it is not yet known how the unemployment rate will respond as we move into summer.

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