Both 2020 and 2021 saw changes in the way we have been living our lives. Members of society were allowed to work from home while others sought work elsewhere due to business closures. Several government programs were created to help those in need of assistance who could not work. While the majority of those programs have ended, life is almost back to normal. There is still a considerable gap in the workforce which is felt on the individual and corporate levels.
One of the major complaints from customers in retail stores is customer service or the lack thereof. In the past, there were complaints about stores using self-checkout registers instead of manned registers before the pandemic. However, now that has escalated to complaints about longer waits, poor customer service, or no customer service at all due to the lack of employees available to assist. It seems like brick and mortar stores are running on skeleton crews, unable to find more workers.
Even though the public complains about retail customer service, and it seems as if there are no jobs available, we have 146,485 jobs posted on LinkedIn in the state of Kentucky. Roughly 12% of the jobs posted are for retail positions. While it may not seem like a significant number, that is 17,931 jobs available in retail alone. That gives plenty of opportunities for unemployed people to find new jobs, yet businesses are having a tough time finding new employees.
Jacob Ross, a self-hiring merchandising service manager for a big retailer, has had three open positions in the past six months. A team being down three employees may not seem like it has much of an impact, but with 13 or more associates, missing three employees can significantly impact day-to-day workings. “Two were full-time positions that took about three weeks. The last part-time position posted was up for four weeks with no qualified candidates. I end up having to post another full-time to fill the position,” said Ross.
Going a month or more while being short-handed causes extra stress to those who are still working. Often employees have to work harder by working longer hours and picking up overall slack in areas urgently needed. According to Ross, applicants are offered an interview but either deny the opportunity or do not show up to the scheduled times.
Michelle Rutan, a scheduling and staffing administrator, has had similar problems while hiring for open positions. “A lot won’t show up for an interview,” said Rutan. She has even had applicants reach out to her to schedule an appointment, and they still fail to show up or even call to reschedule. However, there are problems that Rutan runs into while trying to hire a new employee. A common issue she sees with most interviewees includes scheduling flexibility and availability. Several applicants are unqualified for the open position.
Another big problem Rutan often faces is that those offered a job will decline it after discussing pay. For those accepting the position, Rutan said, “A lot of people will come in, work a day or a few, and then quit.” Perhaps the pay scale is not enough for the job, or candidates are finding they can make more elsewhere.
Both Walmart and CVS raised their minimum wage to $15. In larger areas, that might not seem like a lot based on the cost of living. In smaller, more rural areas, $15 is quite an increase from the standard minimum wage. In 2021, it was reported by the U.S. Bureau of Labor Statistics, that 43 out of the 46 North American Industry Classification System industry groups raised their hourly compensation in 2020. This national wage increase is affecting smaller towns that are slowly seeing an increase in the cost of living, making the newer wage rates seem inadequate. Overall, the country is seeing a +0.4% increase in the Consumer Price Index based on the U.S. Bureau of Labor Statistics. Society knows that this trend will continue over time, giving reason to a refusal to work for lower wages.
Businesses that are not increasing their minimum wages to better compete with competitors are directly feeling the effects. It is harder to find new employees when they can earn more for doing less in most cases.
However, another major factor for finding employable candidates is geographic location. Jason Atherton, a district merchandising service manager, noted that geographic locations and businesses in that area could play a role in trying to hire. Atherton oversees 11 stores, eight of which have traveling teams. He said areas like Bardstown are a hard place to hire due to the number of distilleries. Usually, distilleries pay good wages that make the competition to hire difficult. Due to that, open positions for his company are posted in one of the less competitive regions that are a part of one of his traveling teams. “Corbin, where there’s not a diverse economy, you don’t have a lot of turnover there anyway; usually, you get a greater influx of candidates. So Somerset, Corbin, and all those areas, we never had any problem with the candidates,” said Atherton.
Another consideration for why retailers might have a hard time hiring people may be attributed to the changes in the workforce brought by the COVID-19 pandemic. Atherton said, “There’s a lot of factors that go into play with labor shortages right now. Most of it’s COVID impacted. So, a lot of people’s jobs are affected at that time, and one, they were either being supported by programs that were going on, or two, they found other employment.”
Most businesses have opened back up since the closures in 2020. Nevertheless, individuals affected by closures during that time did find other ways to make a living. In 2020, 70% of all full-time American employees worked remotely, with one out of two employees refusing to work on-site after COVID-19 according to a study by Owl Labs. Remote work allowed people to have a schedule that may be more forgiving, while others found an opportunity in ‘side gigs’ such as DoorDash. Despite their old positions opening up, workers realized that they did not want to go back as they had found betterment in their new working lives. Workers are willing to lose benefits and paid time off because they have become their own boss. Some found that their gains in a new line of work are not worth losing by going back to an industry-standard job such as retail.
Programs created to assist those who could not work during the pandemic have ended for the most part. Despite these programs ending, businesses cannot fill available roles. However, finding suitable employees ever since the peak of the pandemic has been an issue. Due to short-staffed businesses, it is not uncommon for businesses in small towns to post a note declaring that they are sorry for the long wait times. This is the case with the Harrodsburg Dairy Queen. These notices attempt to help the customer base understand and to ask for patience, but they are another reminder that there is a significant need for more people to join the workforce.
Most employers are blaming government assistance as a reason why there is such a gap in eligible employees. However, with the temporary assistance gone, there must be other factors that deter a suitable candidate from applying.
To find a solution, looking back to geographical locations and what businesses are located in these areas are key. According to Kentucky Educational Television, Kentucky has 4,500 manufacturing plants, usually all paying more than retail positions. This creates competition, causing multiple workforce members to flock to these companies for the reputation of great pay and benefits as well as the location.
One issue that is often overlooked is overall employee morale within a business. Morale is an issue that some companies suffering from labor shortages are experiencing. The labor shortage is causing employees to do the job of multiple people, oftentimes with no additional pay, training, or recognition. Companies experiencing a shortage may decide to permanently continue without a particular position, forcing employees to widen their job duties. There will be little opportunity to have a flexible schedule or take time off from work with less shift coverage. These factors alone may make people look elsewhere for employment.
For most companies, the workload does not change. For Atherton’s teams, he said that morale “affects our team just as much as anything else. Because of the allotment of hours that we’ve got, they’re saying, ‘well, you should have this many hours all the time.’ So if we don’t, the workload doesn’t change; it just becomes more constrained... We’re still trying to hang on and keep up with resets... It inevitably affects morale of people if they’re continually understaffed.”
This cycle of understaffing that started with COVID-19 closures continues after the pandemic. Most companies are trying to catch up to changes in the workforce from COVID-19, whether by raising wages to seem more appealing or to offer something that remote work cannot. This highly competitive market that has been created will continue to challenge employers.
In September of 2021, the food service industry along with those in an accommodation position saw a quit rate of 6.6% based on a report from the U.S. Bureau of Labor Statistics. While the percentage seems low, that’s equivalent to 4.4 million Americans. In areas with a large manufacturing presence, people may find service positions to be understaffed. Eventually, this trend will decrease, but for now, must be dealt with by companies who are most affected.
