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Columns | Go Far With Kovar

Why are there no workers?


by Taylor Kovar

Hi Taylor: I went to a Starbucks the other day and it was closed because they "didn't have enough workers." When is this going to end? And is it because of the unemployment benefits or something else? - Lisa

Hi Lisa: In my opinion, the labor shortage is an under-discussed problem that's resulted from the pandemic. In many cases, people aren't working because of the enhanced unemployment, but that's not the only problem. Let's take a closer look:

1. Unemployment. It's not too hard to find someone who's not working because the government check they're getting is more than what they'd make at a minimum wage job. However, with those benefits expiring, we're about to see how much that was actually holding people back. We're also going to see some wage increases before the end of the year. Starbucks is one of a few companies set to raise their minimum wage and give pay bumps to all employees, which might have an effect on future hiring issues. There's no doubt the stimulus helped people who couldn't work while also motivating others to stay out of the workplace, but that's hopefully about to end.

2. Delta. One way or another, COVID-19 continues to have a huge impact. Sometimes it's government mandates keeping people out of work, other times it's the virus itself putting people on sick leave or forcing them to stay home as a personal precaution. High-risk individuals who used to go work in cramped quarters are understandably hesitant to go back to work. As the Delta surge continues, we should expect to see staffing issues, especially since a positive case can force so many people in proximity to quarantine for at least a few days.

3. New normal. I keep reminding myself that things aren't going back to the way they were, certainly not as fast as we'd all like. We've been living through a once-in-a-generation pandemic that upended everyone's lives, and some businesses won't come back from that. Other companies will shift the way they operate, and a whole lot of people will seek out a career change over the next few months. This is not to say that we'll be dealing with a labor shortage forever, but the recovery is ongoing and it's important to remember that. Things will get better, we will get through this, but it's going to happen one step at a time — with the occasional step backward.

All things considered, I'm hopeful the labor shortage will improve in the coming months, which will be a nice economic lift and hopefully feed into itself, creating even more jobs than before. Thanks for writing in!



Taylor Kovar September 6, 2021
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Legal Disclaimer: Information presented is for educational purposes only and is not an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. To submit a question to be answered in this column, please send it via email to Question@GoFarWithKovar.com, or via USPS to Taylor Kovar, 415 S 1st St, Suite 300, Lufkin, TX 75901.


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