Higher Wages, Not Enough Workers
That is still not enough to fill all available openings. Higher wages reflect as higher prices for consumers, and potentially lower sales which then create a negative trickle effect.
Knowing that needing workers right now may not be the case later in the year is what keeps businesses offering higher wages. Businesses know that customers still expect to be served, regardless of the back-of-the-house employment issues.
In a Wall Street Journal article, restaurant owner Luis Reyes said, “The scarcity is huge. It’s a terrible stress. Many times I suffer from insomnia thinking about what we are going to do to give service.”
The article describes how the Federal Reserve has raised interest rates sharply in an effort to cool the economy and push down inflation. Many economists predict that will push up unemployment and trigger a recession. But for now, employers are more preoccupied with the labor shortages that hurt sales, investment and growth.
Should Immigrants Earn More?
Whether or not to pay immigrants as much as U.S. employees earn is a contended issue. The reality is that U.S. workers are not clamoring to fill the jobs immigrants are doing. With updated immigration reform, the pay to immigrants could level and create a more competitive hiring market where small businesses and large companies have enough workers. It could also level product and service prices and make room for growth across industries.
An example of such comes from an outdoor resort owner who cannot expand his business- even if he has the money to do so. Dave King, owner of Lake George RV Park campsite in Queensbury, N.Y., can’t find the workers to develop projects despite having more than $1.5 million for expansion and equipment purchases.
“We have never faced greater challenges in filling our seasonal staff vacancies than now,” said Mr. King, whose family-run business, with about $6 million in annual revenue, has been in operation for almost six decades. “This is our 57th season, and I’m unsure at this point how much longer we can hold on until a permanent fix to this problem is found.”
Competitive Edge Driven by Immigration
Immigrants are needed, from STEM to kitchen jobs, it is a proven fact. Nations around the world are facing this same struggle of needing employees. Unlike the U.S., other nations are implementing progressive immigration programs to welcome younger people to study or get work training and get a worker’s permit and eventually citizenship. The U.S. will relieve its employment and economic woes by implementing similar programs. The sooner, the better.
A report by the U.S. Department of Energy, covered by the Council on Foreign Relations, found that, “since 2010 the United States has been losing its competitive edge in basic science research to China. This loss of competitiveness is partly due to immigration issues.”
Regardless of what political party we support, the economic strength of the U.S. depends on immigration reform.
