Speaker Pelosi finally got her wish: Americans have been freed of ‘job lock.’ The fawning Spring articles in the mainstream media on the empowerment of the American workforce still trickle out here and there. But the confident, even celebratory, tone they took – telling us of wholesale changes in our cultural approach to work and even a ‘Great Resignation’ – is starting to waver as the disruptions and price increases so obvious in our daily lives mount. And so, Americans are about to hit the road for the Fourth of July with service delays, supply chain breakdowns, and high gas prices due in part to a shortage of oil tank drivers.
This was not what we were promised. Not when many of us submitted ourselves to an experimental vaccine that has been around less time than the IPhone12. Wasn’t the reward supposed to be a return to normalcy? Not concerts delayed yet again as emails for virtual performances hit our Inboxes, pools operating on limited hours for lack of lifeguards, and ride-sharing services diluted in many cities around the country. Of course, the continued pain of our diners, cafes, and restaurants losing available revenue remains visible to all.
Looking forward to a summer of recovery yet seeing many restaurants in a half-life due to lack of staffing; grand openings delayed; dreams painfully dashed. And for many that are open, this odd scene: servers rushing about overstressed in a restaurant that’s half empty. Long waits despite the lack of a line, confusing until you realize there are only two servers for the entire place. The other booths are closed not for COVID but lack of staff and the prep cook is the line cook is the dishwasher. Despite the hopeful claims of many mainstream journalists, each of us knows enough small business owners struggling to find folks willing to work to know this scene is no mere anecdote.
What it is is an unacceptable level of labor market intrusion. After a year of suffering, a hobbled American economy has enough to overcome without having to tolerate this degree of federal arrogance and incompetence. For those of you who only tune into politics occasionally, this is what bad public policy looks like, and how it hurts you. If you’re looking for evidence of overreach, this is a hardcover textbook.
Even as Republican governors look to fix the unemployment extension debacle, the UBI-disguised-as-tax credit hits bank accounts starting July 15th. Plus, the Democrats have made public their intent to add several new permanent entitlements via the post-infrastructure reconciliation bill. Oh yeah, and they are still making noise about free college via student debt forgiveness. At that point, Mitt Romney’s infamous 47% quote will be quaint; Democrats will be actively buying a far higher percentage of votes than that.
President Biden seems determined to relive the legacy of his Democratic predecessor’s abysmal recovery from ‘08. While the overall economic numbers right now are strong relative to the pain we just experienced, how much opportunity are we leaving on the table? In the years after the last financial crisis, annual GDP growth remained below post-WW2 historic norms as the Obama recovery introduced sub-3% GDP growth as the new American normal. Public policy matters, and if we had found a way to maintain those postwar norms – consider how much commerce and wealth creation even a single percentage of GDP growth represents – many around the country would’ve been more financially secure and stable entering the 2020 crisis.
Now, we are supposed to be returning to work, yet June’s supposedly rosy job numbers tell us there are 2.9 million more long-term unemployed than in February 2020 and that the proportion of the U.S. population in the labor force – 61.6% – remains exactly the same as it was in May. Those fewer workers are now bearing the weight of so many missing coworkers. Some dispatches from Pittsburgh over the past few weeks are notable:
Across the counter from a barista, he shared that he was hired in May and yet already one of his shop’s longest-tenured employees, earning him the brunt of complaints about slow service.
A bartender last week told me she hadn’t had a day off in weeks. She appreciated the shifts and the extra cash and even said she moved up the timeline for paying off her house, but man could she really use a day off.
That same week, a friend who owns a small seasonal business mentioned in casual conversation turning down precious Summer bookings specifically to avoid burning out the few staff she did have.
Thursday night I popped into a new local joint whose original location was widely acclaimed in all the fancy publications, they survived COVID with creative events and grit. They were fortunate in that their opening of the second location was only delayed by a few weeks, yet even with that delay, they had to limit tables due to lack of staff.
This is how to bumble a recovery. Job lock is gone for today, creating for workers new, short-term choices that feel like empowerment. But we’re replacing it with debt lock, the hard math that will constrain our choices for a generation.
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