Best Ever Job Market Should Upend Standard Employment Policy – Wirepoints

By: Mark Glennon*

The world sometimes inverts so rapidly that consequences go unnoticed.

That’s the case with our current job market – the best ever for jobseekers. Job openings across the nation exceed 10 million for the first time ever. America has more help wanted signs out than it has people unemployed.

For now, at least, maybe the mantra for politicians and policy makers should be “Take the job. And if you can’t find a good job nearby, move.”

The consequences of the historic job market simply haven’t yet sunk in:

      • For able-bodied people who are dependent on government welfare, there has never been a better opportunity to join the workforce.
      • For anybody longing for a career change, now’s the time.
      • And for those hoping to relocate, the choice is theirs because the worker shortage is acute across most of America.

That should turn a traditional article of faith upside down. “Jobs, jobs, jobs” is gospel in most times. No matter what their politics, most everybody at least claims to consider employment effects in just about every policy matter.

What’s different now is that the jobs are out there; unemployment isn’t resulting from too few jobs. It doesn’t get any better than this.

It’s true even in Illinois, in most sectors, and it’s not just about low skill or entry level jobs.

I checked in with Mark Denzler, president and CEO of the Illinois Manufacturers Association, which has many members desperate for workers. “These are good paying, middle class jobs that average more than $80,000 in wages and benefits,” Denzler told me. “We need to get able-bodied individuals back in the workplace in order to grow the economy and be able to simply fulfill orders.” Manufacturing alone has more than 800,000 open jobs nationally, nearly double the previous record, Denzler says.

Farmers and ranchers face a severe worker shortage. Hospitals are absolutely desperate for nurses, a shortage raising fears about staffing for COVID hospitalizations that’s probably more severe than bed counts. In the construction industry,“virtually all professional trades are in high demand, including carpentry, plumbing, electrical, HVAC, roofing and painting.”  By 2028, more than a million craft professionals will be needed in the residential construction industry alone.

The shortage extends to white collar workers. “Firings and layoffs reached record lows in June and companies have been rolling out new staff perks, from higher salaries across Wall Street to $1,300 fitness machines for senior staffers at a New York City hotel,” reports Business Insider. It’s ‘The Great Resignation’: White-collar staff calling shots as job markets recover,” says a Reuters headline.

A broad survey from Gallagher & Co. shows the extent to which employers are willing to go to entice workers in the pandemic era. Some 41% of employers responding said they are offering enhanced benefits. One such enticement: 19% say they are offering pet insurance, a perk that is expected to rise to 27% of companies in the next two years.

But politicians remain stuck in the world where job creation was everything. Here in Illinois, for example, Chicago continues to “invest” in areas short on jobs. The city last week announced new mixed-use projects valued at $200 million for South Chicago, North Lawndale, Bronzeville and New City as part of its Invest South/West initiative to spur development in disadvantaged communities. Trillions more in federal spending loom, loaded with “equity” requirements targeting high unemployment areas.

Wouldn’t it be wiser and kinder to encourage able-bodied, jobless people to move where the jobs are?

Move. Just move. If you think that’s a heartless, conservative thing, forget it. Voices on the left have recognized that, for the underprivileged, moving is a ticket to upward mobility. Research is proving it’s true. That research was detailed by a left-leaning Vox article about families reliant on housing assistance. The economic consequences of moving to places with more opportunity could be massive, says one researcher the article quoted, who estimates that the lifetime benefit to a newborn child of moving from a low- to high-opportunity neighborhood is about $210,000 in additional income, or an 8.1 percent increase in lifetime earnings.

Seattle put that research to work by providing information and counseling encouraging housing voucher recipients to move to better places. It worked. “This is the largest effect I’ve ever seen in a social science intervention,” another researcher told Vox.

Many of Chicago’s African-Americans have already figured that out. They have represented the largest portion of people leaving the city for other states; 200,000 have left over the last decade. For them, it’s not just about jobs but better schools and safer neighborhoods.

With a job market that’s as good as it gets, you would think politicians would adjust their approach accordingly, but precisely the opposite is happening. Congress may be poised to pass $3.5 trillion of “human infrastructure,” which unquestionably is designed primarily to replace dependence on work with dependence on government. It would “mark the biggest expansion of the social safety net in nearly 60 years,” says the New York Times.

And the Biden Administration is urging some states to extend extra unemployment benefits after the September expiration date for federal supplements. That’s crazy, being perhaps most clear in the restaurant industry. Restaurants are so short of workers that some are forced to curtail their hours.

On that, I get an earful from a local entrepreneur, Jesse Boyle, who owns Station Restaurant and Bar and Vinny’s Pizza Bar in Chicago’s Ogilvie Transportation Center.

“My business is newer, with a nice facility, nice people, and is in the middle of the action in downtown Chicago,” he told me, but “I could not for the life of me understand why people were not responding to our offers, especially with wages that would get them in excess of $80,000 per year for a basic bartending position.”

“I’m convinced that the premium unemployment benefit very much stunted our ability to get going. People are smart,” Boyle said, “and they do these calculations all the time.” To this day, he says, “I still have not been able to hire enough people for the work I need to do.  It is constraining growth, and at this point I’m just hoping that the expiration of the federal unemployment benefit on September 1 will bring more people into the workplace.”

Boyle is hardly alone. Small businesses like his are bearing the brunt of the labor shortage, as reported in a recent Quartz column.

Source: Quartz

Nobody knows how long the unprecedented opportunity in the jobs market will last, but for now a change from traditional employment strategy is clearly in order. Forget job creation for the time being. Tell people to take the jobs available and, if necessary, move to where they are plentiful.

*Mark Glennon is founder of Wirepoints.

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r
2 years ago

Why work? Free food stamps and rent are today’s norm in Illinois.

NB-Chicago
2 years ago

One issue I notice, at least anecdotally, with my 20 something kids and their friends is they really live in their own little social media bubble/world (as do we all). They don’t read about politics and/or certainly wouldn’t have a clue or any interest on Illinois/Chicago fiscal disaster or how it effects their lives (@ 63 after living here a lifetime I’m still incredibly confused about how Ill works, even with reading wp 24/7). What I’m trying to get at is I think there’s a real lack of the big picture for most folks, especially amongst young people about HOW… Read more »

NB-Chicago
2 years ago
Reply to  NB-Chicago

of course if we all had TIER I / Streets and San-$100k yr Tree Trimmer jobs finacial literacy courses wouldn’t be necessary. Or maybe even showing to work.

Rural Mom
2 years ago
Reply to  NB-Chicago

I thought teaching about personal finance, along with basic morality, getting along with others, and grooming was a parent’s job. We should never rely on the public school system to do a parent’s job.

Marko
2 years ago
Reply to  NB-Chicago

Ever wonder how the Pritzker class comes about, how people you’d think would embrace capitalism because they themselves are it’s ultimate beneficiaries? 100 years ago there was a capitalist Pritzker, or in their case a mobster but I digress, who worked hard, built something and passed it down. Four generations of compound wealth later the attitude is F U I got mine and want yours too. They are pulling up the ladders and confiscating power. They think of themselves now as benevolent royals and us their feudal tax serfs.

Rick
2 years ago

A breakfast restaurant by me has begun paying waitresses in cash under the table to stay open. Its a win win, they don’t lose their unemployment, they make tax free money, and he has the help.

On another note the wife and I went to KFC in New Lenox, it was closed with a note on the drive up, “no employees we are closed today”.

Fed up neighbor
2 years ago
Reply to  Rick

Happened to the Taco Bell out by me also

nixit
2 years ago

People wrongly focus on low wage argument, saying that employers need to raise entry-level wages to fill these jobs. But the main driver is really the replacement wage. The feds have artificially inserted a subsidy into the job market that is simply too generous, thereby distorting the true value of that work.

If the govt gave the same replacement wage rate for any profession (programmer, dentist, lawyer, etc) as they do to a low wage worker, many of those professionals would chose to not work either.

Illinois Entrepreneur
2 years ago
Reply to  nixit

Yes, this is exactly right. Plus, there are two additional premiums (or discounts, depending on your vantage point) to consider: 1) free time from work and 2) untaxed benefits from unemployment.

If someone is going to pay you $20/hr to not work and have time for side jobs, would you take, say, $21 for 40 hours, thus netting you only an additional $40? Most people would not.

On top of that, you are taxed for work, but untaxed for unemployment. So add an extra $4, just to break even.

Employers can’t compete with that.

Marko
2 years ago

Union tradesmen been pulling this for decades. In winter they collect unemployment while doing side work like house additions, basements and maintenance

Eugene from a payphone
2 years ago
Reply to  nixit

You’ve just described the problem of replacement father/wage earner the Government created in Black neighborhoods. Also, Wages under the table won’t help.

NoHope4Illinois
2 years ago

Based on inflation trends, I’m guessing by this time next year much of the country will be in a economic downturn as consumer spending contracts.

Carl
2 years ago

There are specific issues for Illinois but the US (and Canada) are facing very unusual workforce headwinds.
Population growth is down, population is aging, social mobility is down and geographic mobility is down.
The American Dream defined by the hope that the following generation will do better is dwindling.
Instead of going through some kind of restructuring, some kind of extend-and-pretend attitude has been forming, as exemplified by the following:
Illinoisans Paid Almost as Much on Unemployment as at Work | RealClearPolicy
Somehow, i’m confident that obstacles will be surmounted but why make it so difficult?

geo mobility.png
Freddy
2 years ago

Maybe JB should move to New York. I hear there will be a spot open there for a governor.

LessonLearned
2 years ago

Those Illinois residents that say they can’t leave Illinois because of their job are merely making excuses. Jobs exist everywhere right now. Those that say they can’t leave because of family are also kidding themselves. In many cases the best thing someone can do is lead by example. If you leave, others will follow. Someone has to be first.

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A statewide concern: Illinois’ population decline outpaces neighboring states – Wirepoints on ABC20 Champaign

“We are not in good shape” Wirepoints’ Ted Dabrowski told ABC 20 Champaign during a segment on Illinois’ latest population losses. Illinois was one of just three states to shrink in the 2010-2020 period and has lost another 300,000 people since then. Ted says things need to change. “It’s too expensive to live here, there aren’t enough good jobs and nobody trusts the government anymore. There’s just other places to go where you can be more satisfied.”

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