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What I’ve Been Reading This Week

 

With a less than stellar jobs report out this morning, I wanted to lead things off with an Axios article I read a few weeks back that addresses the struggle in some industries (in particular the restaurant industry) to locate enough workers to stay operational.  The reason?  Partly a lack of interest in returning to front line work in the age of the coronavirus yet also many workers realizing they can make more in unemployment benefits than they could actually working these jobs.

As always, below are a couple articles that caught my eye this week.


Now Hiring...But Who Will Actually Take These Jobs??

As noted above, Axios published a well thought out article recently in which it recognized the ongoing problem many employers in the restaurant industry are facing as they struggle to re-staff their businesses as things continue to reopen across the country.  The article notes that many employers in the industry are not only struggling to hire employees but also struggling just to get them in the door for an interview.  (One McDonald’s location was reported to be offering applicants $50 for just showing up for an interview.)  That has led many to ponder what steps can be taken to bolster employment numbers in this sector.  Some have suggested scaling back unemployment benefits so workers are incentivized to return to the workplace rather than continue to collect unemployment.  Others have suggested the problem is indicative of the need to raise wages...given that many workers are only making the federal minimum wage rate, $7.25/hour in some parts of the country.  (It is worth noting that many workers in the restaurant industry report they can make as much, or a comparable amount, in unemployment benefits than they would if they were actually working.)  In addition, some employers are offering incentives and referral bonuses in an effort to fully staff their workplaces.  Is there a clear solution?  It depends who you ask, but probably not.  The likely solution is it will take several things to actually get more workers back in the workforce.


$15/Hour Wage Rate at Chipotle = More Expensive Burritos & Guac

On an earnings call last week, Chipotle’s CFO Jack Hartung, noted that should the company raise its hourly pay rate for employees to $15/hour (from its current pay rate of $12 - 13/hour), menu prices would likely rise about 2 - 3% across the board.  It should come as no surprise that rising labor costs would eventually be passed to consumers.  While there are apparently no set plans in place at this time for Chipotle to boost employee pay, I think the comments on the earning call are indicative that it is likely something that the company is setting the stage for in the not too distant future.


In 2022, Tennessee Voters Will Have Final Say on Right to Work Law

Last Thursday, the Tennessee Legislature advanced the constitutional amendment that will allow voters in the state to have final say no whether to write a right to work law into the Tennessee Constitution.  Voters, who will head to polls in 2022 to vote on the matter, could make Tennessee the 28th state to approve a right to work measure.  While this is no sure thing (in part because the PRO Act could throw a wrench into things here), this is one to keep an eye on.

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