If you’ve visited restaurants or retail stores lately, you may have seen the signs: “We’re dealing with a staff shortage. Your patience is appreciated.”
Nearly two years after the start of the “Great Resignation,” in which millions of Americans quit their jobs during the COVID-19 pandemic, many businesses remain understaffed. As a result, consumers might have to wait longer for their pizza or to pick up a prescription.
So where did all of these workers go? In a new report, the U.S. Chamber of Commerce calls it the “Great Reshuffle.” Many people who quit their jobs have moved into other industries that provide a better work-life balance, better pay, and more flexibility about where they do their work.
“During the pandemic reshuffling, jobs that require in-person attendance and traditionally have lower wages, have had a more difficult time retaining workers,” the Chamber said in its report. “For example, the leisure and hospitality and retail industries have had the highest quit rates since November 2020, consistently above 4.5%.”
The staff shortages have not been limited to those industries. The transportation industry has struggled to fill jobs. Even health care jobs, which usually come with relatively high pay but also a high amount of stress, are going unfilled. According to the Chamber, hotels and restaurants have the highest number of job openings.
The pandemic’s impact
The experts we consulted say there is no question that these staff shortages are the direct result of the pandemic. Andrew Duffy, a behavioral economics and labor expert in addition to being the CEO and Co-founder of SparkPlug, says it’s mainly frontline workers who are disappearing.
“The prevailing sentiment in America is that success equals a desk job with a salary, while hourly- or service-based work is the bottom rung of the economic ladder,” Duffy told ConsumerAffairs. “The pandemic exacerbated this overarching belief, with businesses praising their employees as ‘essential’ while simultaneously offering little to no additional financial support or resources. Frontline workers are burned out and angry.”
Mark Kaley of Otter Public Relations, who consults a number of small businesses, agrees that it is a narrow sector of employment that has been affected. He tells us that many employees reevaluated whether they found satisfaction in their work position during the pandemic.
“How employers handled the shutdowns and reopening affected potential employees' perception of the employer,” he said. “These former employees have either moved on to other positions where they find more satisfaction or moved on to other employers with a better work-life balance.”
Quitting might actually save money
Chris Motola, a financial analyst at MerchantMaverick.com, says the pandemic increased challenging family duties for many workers who had to make choices between working or caring for family members. Previously, most families paid for child care or adult care.
“A lot of people dropped out of the workforce to perform those tasks,” Motola said. “Some of them may have even discovered that they're ultimately saving money this way.”
Jeanniey Walden, chief innovation and marketing officer at DailyPay, Inc., says the impact of staff shortages may be most pronounced at restaurants. She points out that food service sectors had a quit rate of 5.7% in May, compared to about 3% for the national average.
In some cases, restaurant owners who struggle to fill positions may have decided to live with the situation by operating with a smaller staff. Walden said the same is true in the hotel industry.
“Many companies are seeing this time as an opportunity to reexamine how they can operate more efficiently,” Walden said. “For example, many large hotel chains now offer housekeeping services upon request, a trend that began during the early days of COVID. Many chains have continued the practice to save money, allowing them to shift resources to other customer service-focused areas.”
The Chamber of Commerce report also underscores the impact of the necessary shift to remote work early in the pandemic, calling it a game-changer for the labor market. It cites a recent Gallup Poll that found 91% of U.S. workers hoped they could continue working some of their hours from home. Three in 10 workers in the same poll said they would seek new employment if they were recalled to the office.
All of the experts that ConsumerAffairs consulted agree that the labor force shifts may be permanent. For consumers, it likely means getting used to more leisurely restaurant meals and more self-service in retail stores.