Some Things Aren’t Complicated

I often post about the complexity of the issues confronting us these days, but I will readily concede that everything isn’t complicated. In fact, some things turn out to be relatively simple.

Case in point: As the pandemic has eased, thanks to vaccinations, and Americans have begun returning to the restaurants and bars we all missed during our year of isolation, the media has been full of stories detailing the difficulty those establishments are having attracting staff.  Politicians and pundits have “explained” the problem via their respective  biases: Republicans, for example, have insisted that the reluctance to return to these jobs is a result of the unimaginable generosity represented by those $300 unemployment checks.

Several Red states, including Indiana, have rushed to terminate those payments–essentially, calculating that further impoverishing the unemployed will force workers back into the low-wage labor market.

A number of economists have suggested that blaming the problem on unemployment payments, as satisfying as Republicans may find that explanation, is incorrect, and emerging data–that pesky thing we call “evidence”–would seem to confirm that conclusion. A number of media outlets, including the Washington Post have reported that there is even a relatively simple “fix” for the problem: better pay.

The owners of Klavon’s Ice Cream Parlor had hit a wall.

For months, the 98-year-old confectionary in Pittsburgh couldn’t find applicants for the open positions it needed to fill ahead of warmer weather and, hopefully, sunnier times for the business after a rough year.

The job posting for scoopers — $7.25 an hour plus tips — did not produce a single application between January and March. So owner Jacob Hanchar decided to more than double the starting wage to $15 an hour, plus tips, “just to see what would happen.”

The shop was suddenly flooded with applications. More than 1,000 piled in over the course of a week.

When a variety of media outlets reported on Klavon’s experience, it prompted a number other business to emulate the tactic–and guess what?! That clever ploy worked for them, too!

As the Post story noted, across the country, businesses haven’t been facing a scarcity of workers — they’ve been facing a scarcity of workers interested in applying for low-wage positions.

The current shortage of workers isn’t solely a function of low wages, of course–the problem isn’t quite that simple. There are a number of other elements exacerbating the problem, as the article pointed out.

Republicans have blamed enhanced unemployment benefits for the shortage; Democrats and most labor economists say the issue is the result of a complicated mix of factors, including many schools having yet to fully reopen, lingering concerns about workplace safety and other ways the workforce has shifted during the pandemic.

That said,

The experience of 12 business operators interviewed by The Washington Post who raised their minimum wage in the last year points to another element of the equation: the central role that pay — specifically a $15-an-hour minimum starting wage — plays in attracting workers right now….

Enrique Lopezlira, a labor economist at the University of California at Berkeley and an expert on the low-wage workforce, said the stories were a sign, albeit anecdotal, that the market was functioning as it should in the face of excessive demand for workers.

“The more employers improve the quality of the jobs and the more they think of workers as an asset that needs to be maximized, the better they’re going to be able to find and retain workers long term,” he said.

Several individual stories recounted in the Post article bear that out.

Many of the business operators interviewed said that the decision to raise their employees’ starting wage was not motivated primarily by altruism or a desire to do right: It just made good business sense.

They said wage increases would help attract stronger candidates, reduce turnover and elevate company morale and culture — important for customer-facing businesses such as restaurants.

“We’re going to see savings in retention and turnover, which is so expensive,” said Nicole Marquis, the founder and chief executive of HipCityVeg, a group of fast-casual vegan eateries with locations in Philadelphia and D.C. that recently announced a $15 starting wage. “And this is going to help with recruiting, which will help with our culture — and is really what drives profit at the end of the day and creates a long-lasting brand.”

No kidding.

Some things aren’t that complicated…


  1. Add the dangers of the workplace that reflect customers’ lack of concern (or dare we say “respect”) for low-wage workers. The Big Bear Supermarket shooting death of a cashier in Decatur, Georgia over a dispute about face masks should give all of us, especially women, pause. Is it worth working hard 8+ hours a day and have to put up with under-educated, opinionated, customers willing to risk public health for their own convenience? I would argue not even for $15 per hour, but that’s a different story.

  2. Well, small businesses fail quite often due to the lack of skill set of the owners. They may be great cooks or know how to build things, but they are lousy business people and poor leaders.

    My Facebook page was loaded with business owners (Republicans) who were shouting at the government to end unemployment because they couldn’t find workers. They were quick to point out that “lazy workers were the problem with the society.”

    Can you imagine how they treat their young workers?

    Nature, not the markets, will balance things out.

    And speaking of nature, I’ve been reading several articles that have been interviewing workers, and business owners are getting ready to experience a rash of resignations. I’m not talking 5% — it’s expected to reach 40%.

    I won’t expand on the “great resignation” but I can tell you it has very little to do with the minimum wage. I read a book over a decade ago about what motivates workers and it isn’t a paycheck. Turns out it’s mostly intrinsic. Many of the newer high-tech firms appealed to these motivations, but not all. I suspect this is the crowd looking to resign and reevaluate their lives and the role work plays in it. The pandemic (among other influences) has forced workers to start asking work-life balance questions.

    Meanwhile, the richest leaders in the world met this week and want war against Russia and China. They are so disconnected from reality, it’s not even funny.

  3. And just yesterday, the blog “Money Makes The World Go Round…” provided the reason for the government to continue paying people NOT to return to work but sit home collecting those $300 checks. How much is it costing this government in those millions of $300 checks to refuse to demand by law that the minimum wage be increased? There are also countless workers who have jobs which provide no Unemployment Benefits or limited benefits or only after 5-6 weeks of being out of work due to conditions beyond their control. Laws controlling Unemployment Benefits for working people need to be changed. Today; just sit home and wait for the $300 to arrive.

    “Some Things Aren’t Complicated”

  4. Todd brings up a good point!

    The “great resignation” as he calls it, I think I actually read that particular phrase in a CNN article, isn’t overly nuanced, but the younger techies do not want to go into a regular office environment if they don’t have to! My youngest son and his significant other both work for tech companies. My son is an IT guy, and his plus one is a code writer. These things can be done easily from home, and they both do a good job at it I would imagine, because they’ve gotten Significant Increases to retain their services by the companies they work for. And the deal was work from home!

    When we were talking to him the other day, he was saying that and his circle, his peers have threatened to resign and go to other firms that allow them to work from home, provide adequate insurance, and a better wage! Working from home makes a huge difference in that”” work life balance” Todd was talking about! These young folks are not spending significant parts of their days commuting anymore, and they don’t want to, for work that is! And it also puts a lot of treasure back into their chest for other endeavors.

    Then you go the other way, and certain restaurants that we use to eat in all the time, the management says they cannot wait to get the immigrants back into the workforce, because they’ll work for below minimum wage. Although, I think that ship has sailed! They are recognizing that they have power, the same with healthcare workers that are making a minimum wage. Putting their lives at risk for a couple of bucks an hour!

    With all of the insanity going on, cities are having difficulties retaining law enforcement personnel, and even fire and EMT personnel. Things would’ve not been to this point if they just would have been able to leave the $15 minimum wage in the cares act. But, even though it should be easy, they make it complicated for a reason! Major conflict is coming, not just overseas but right here! And, the Republicans better hope Joe Biden stays healthy!

  5. You can add the lack of affordable and reliable childcare to the list of factors contributing to the reluctance of workers to return to the job. When a not insignificant portion of one’s earnings must go to pay for childcare, a low wage looks even less appealing.

  6. Yes, Indygaffer, childcare is now a huge issue for workers. Not just the cost, either.

    Our education system (teachers) has been exploited as nannies and profit centers for publishers of books and tests. As more teachers awaken to this fact, they are going to wonder what the teacher’s unions have been doing for them exactly.

    Also, as John eluded, work at home has many advantages for the workers and the planet. If they have children, they can also keep the kids home and educate them since our educational system is broken badly. Our international rankings are sad and have been getting worse.

    Also, global birth rates are declining as couples make the conscious decision to NOT bring children into this world because of the direction our “leaders” are taking us — not to mention climate catastrophe reveals a dystopian reality.

    Like I said, meanwhile, our “leaders” have their heads wedged deeply up their posteriors.

  7. … speaking of childcare … education has been the major source of childcare in the USA for a long time. The hostility toward educators over the last year for not wanting to teach in an enclosed room with 20+ people who are lousy mask wearers, especially if you have health vulnerabilities, has made the teacher shortage even worse.

  8. Todd, Indy, Jen,


    Interestingly though, this younger generation is not willing to have children right now and maybe never. This creates a shortfall in the workforce in the not too distant future. Birth rates are dropping, and not just here, and most of the industrialized world! I guess the part of the world we call first world! The only cure is to force people to have children, or allow for more nuanced immigration!

    Down the road, child care isn’t going to be as much of a deal maker or breaker than it is today. Immigration is going to be a necessity for these corporations to stay staffed and productive.

    Also, instead of college for some of these positions, we are probably going to have to pattern the educational system after Germany’s Apprenticeship and vocational programs. I believe Todd and I commented on this very thing a while back.

  9. We build another two Americas…

    1. “Workwork” – construction, restaurant, caregiving, healthcare, hotel, retail, etc. – gotta get there/back, face customers, deal with safety, fixed hours, uniforms, etc.

    2. “Leisurework” – professional class remote, wear what you want, set your own schedule, ping pong in office, coffee bar in office, etc.

    Any wonder why the 1’s resent the 2’s and might vote GOP?

  10. Remember the complaint, “What ever happened to the WORK ETHIC? I say, “Where the hell is the PAY ETHIC?” I encourage any economist out there to write a book with that title. The entire Capitalist World needs scholarly reading material on that subject, as well as course work while in business school.

  11. There is a different approach to pay checks depending upon your position and what value capitalism places on your skills.

    For instance, I just checked and the average ER Doctor makes: “$294,159 as of May 27, 2021, but the range typically falls between $250,702 and $344,548. Salary ranges can vary widely depending on many important factors, including education, certifications, additional skills, the number of years you have spent in your profession”.

    The average major league baseball salary is just under $4.17 million. Los Angeles Dodgers pitcher Trevor Bauer is the highest-paid player in 2021 at $38 million after agreeing to a $102 million, three-year contract he can terminate after one season.

    Without a doubt the ER Doctors have far, far more value to humanity as a whole than a Major League baseball player. Yet in terms of monetary value a baseball player is paid much more.

    In the world of sports and CEO economics we are told that money allows you to select the best and retain them. Sadly, many companies see employees (the Proles) as expendable, quality is not valued, if you can pay less.

  12. Everything should be as simple as possible but no simpler. My industry leading employer in the 70s, 80s, and 90s paid employees fairly, but never as much as some other companies. Instead, they gave us occasional awards for exceptional service and said things like, “We really value your contribution around here. We couldn’t do this without people like you.” We knew they were stretching the truth, but we went away feeling that our contribution mattered and that made all the difference in how we felt about our jobs. Once you make a living wage, an occasional pat on the back and a thoughtful word sometimes matter more than your next raise.

    My wife wears a T-shirt which says, “My religion is kindness.” Wide adoption of that philosophy could make a big difference.

  13. Terry, I love that saying!
    Lester, the “two Americas” is something that has been smoldering in the back of my mind, thanks for laying it out.
    “Evidence,” wow, what a concept!

  14. Many women are not returning to work due to the expense of child care. There have been studies that indicate that when one parent is a home maker, the family actually saves money. That is because a large part of the home maker’s work is finding ways on the internet to save money on food, vacations, clothing etc. And if the home maker can make the family’s clothing and is skilled at gardening and food processing(canning and freezing food, pickling etc.) this increases the savings.

    Many people, however, do not find being a home maker rewarding or challenging. Having only one person in the work force is risky because “tomorrow is guaranteed to no one.” The average widow in the U.S. is in his/her 50’s. If we want women to return to work, we have to find ways to create affordable child care. If corporate America valued workers as much as they valued shareholders, they would all provide child care to their employees at low to no costs. I will bet that some elders would love to be around the kids more. Too bad nursing homes cannot also provide inexpensive child care and provide programs that benefit both the elders and the kids.

    It will be interesting to see if the search for good employees compels many businesses to increase salaries and/or benefits. I certainly hope so. I am certain that people working in home health care should be paid much more for the services they provide. Home care is much less expensive than assisted living or nursing homes.

    The GOP has a limited view of how unemployment benefits affect the availablity of labor. They oversimplify the issue. Their continued stances on how to support the American economy have proven to be ineffective. Trickle down does not work. They underestimate the power of greed,and the potential for wealthy people to become addicted to making more money and hoarding what they have.
    “Kindness is my religion.” Yes, every day I get to do something kind for someone else, even a stranger makes my day more joyful. And that is just priceless. Especially in a world rife with hate crimes, gun violence, and a widening gap between rich and poor. I will be taking food to a food bank this week. How about the rest of you, my friends?

  15. Lazy workers? What kind of workers and worker loyalty do employers expect for minimum wage (or less) jobs? You get what you pay for, ESPECIALLY in a competitively-tough labor market.

  16. The other benefit to employers of offering much higher wages is to stem the discussion of collective bargaining. So many employees don’t remember how union organizing brought them good pay, good benefits, job training, job security, and ultimately stable employment, housing, neighborhoods, access to higher education, and a higher quality of life. Check out my podcast with Mark Gevaart of My Labor Radio for a discussion about union organizing in these times.

  17. One of my classmates from high school owns a few restaurants/catering and advertised last month for staff. He was offering 10 bucks an hour plus tips and sick time with a 600 dollar signing bonus. For South Bend, that is huge! It must have been well received because I haven’t heard or seen him post it again. Follow the money!

  18. Wage inequality – the biggest domestic issue we have other than, of course, a demented other guy who likes to set dates for his inauguration(s). Corporate greed has always been with us but got a big boost with Reagan. Prior to Reagan median wages and the Dow moved in tandem and the average household had one wage earner whose wages were adequate for a house, a car and the education of children. Median wages have scarcely moved in forty years but the Dow is in the stratosphere – and climbing – proving the complaint of many (including me) that we are valuing investment over labor. (See tax treatment etc.)

    As I write this we have carried interest for hedge and equity funds, billionaires pay little or nothing in taxes, IRS auditing is undermanned, and the WSJ is running amok with its propaganda in re the horrors of big government and the virtues of capitalism. I think the wrong people are in the streets.

  19. Wow – decent pay – what a concept
    Our brilliant entrepreneurs are finally reinventing the wheel.

    Over a century ago, a guy named Henry Ford had a problem – nobody wanted to work in a stuffy building doing the same thing over and over on an assembly line. He came up with a solution – High pay – more than double the previous pay. Amazingly his horrible employee turnover rate went away, and his employees could even afford to buy the Model T, increasing his profits.

    “Business” has always had a two sided view of the world. Free markets should rule, but only when there is surplus labor. Then, supply and demand suggests low wages. If the labor market changes, the government should get involved. There is no labor shortage, just a shortage of people willing to work for paltry wages.

    Similarly, a CEO who won’t work for less than seven or eight figures is only demanding his (occasionally her) due, but a worker who won’t work for chicken feed is a greedy, lazy bum.

    I think Lester points out a problem, but not the one that he thinks he is showing. The non-customer facing world is not filled with offices full of games for their coddled employees. Maybe Google and a few start ups (which allows them to squeeze 100 hour+ work weeks out of their employees) are like that, but having been in IT for over 20 years, and biological research before that, the rule has been tiny cubicles/labs and managers hovering over you saying “if you work from home you must for goofing off because I can’t see you.”

    LeisureWork indeed. Maybe those WorkWork people should look at the lifestyle and perks of the big bosses with executive dinning rooms, golf games, business meetings at resorts (pre-pandemic) and Golden Parachutes. In a phrase, the Trump family. (or Bezos, or name your rich guy/gal). But with great misdirection, anger is directed at those upper middle class “LeisureWorkers” and education in general, leaving the uber-rich with a free ride, and support for the party that keeps them rich.

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