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Why Can’t Oregon Restaurants Find Workers as They Reopen?

Four questions for Jenny Liu, an economist at Portland State University.

As the pandemic eases, Portland’s wooden cocktail sheds and social-distancing stickers are being joined by a new sidewalk feature: the help-wanted sign.

The sight of kitchens seeking cooks might seem surprising. After all, the Oregon hospitality industry just finished shedding 25 years of job gains, and the governor is swiftly relaxing COVID-19 restrictions. But for several weeks, business owners have been complaining that the labor market is tighter than they were expecting—and restaurants are having particular trouble finding job seekers.

“Workforce shortages continue to be cited by restaurant and lodging employers as the number one issue facing their business,” the Oregon Hospitality Foundation noted last week.

On May 18, the Oregon Employment Department announced that hiring in May ground to a virtual standstill, with the unemployment rate unchanged at 6%. The lack of job gains was striking, and part of a national trend.

Jenny Liu already has a job—she teaches urban studies at Portland State University and is assistant director of the Northwest Economic Research Center. But as an economist advising Gov. Kate Brown, Liu regularly compares notes with fellow experts tracking Oregon’s recovery.

WW asked her if she has a theory why people aren’t returning to work. She has several.

The interview has been edited for brevity and clarity.

WW: Why are businesses having such a hard time finding workers?

Jenny Liu: You’re still seeing a lot of people really being hesitant about the level of risk that they might put themselves into—specifically more customer-facing types of jobs. Exposing themselves to that kind of risk and potentially contracting the virus and bringing it home to family members who might be more vulnerable or who might not be able to get vaccinated is definitely still causing a lot of uncertainty for a good number of people.

Another really key factor is the child care situation. Treasury Secretary Janet Yellen was recently talking about how more than 4 million women went out of the workforce during the last year because of unexpected child care or family care situations. Maybe about half of those women haven’t come back into the workforce—mainly because a lot of children are still not fully back in school. Child care facilities are not open, and disproportionately women are the ones thrust into caregiving positions in their families. It disallows a large portion of our workforce to get back into work. Around 2 million women that are not coming back into the workforce is quite a significant number. And the number of women that haven’t come back in into the workforce here in Oregon is going to be significant as well.

The conservative talking point has been that government relief checks were just too large: People are staying home because they’re better compensated not to work. Is that a little true? Is that entirely nonsense?

The amount and the duration of a lot of these unemployment benefits were there to help the lowest-earning portion of our population. And I think that is exactly what it’s doing. It’s helping the people who really need to take care of their families and stay out of work for those reasons—not because they are just earning so much that they’re not getting back to work. It also allows for people to look for jobs that might be higher paid and have a better balance in terms of a living wage versus the risks that they’re taking.

Is the free market making a $15 minimum wage necessary in order to get someone to take a job?

There is definitely an upward push in terms of wages. Businesses are vying for a smaller pool of eligible applicants. And so pushing the wage towards that $15 level is definitely happening a lot faster than we thought it might have. So, yeah, I agree with that.

Does a year of remote work change the job market?

It definitely triggers a little bit of an industrial sector transition between jobs that can be done at home versus jobs that necessarily require people to be face to face with others. I think that’s also one of the reasons why people are hesitant to get back into some of those service industry jobs. There are some jobs that require personal interface with people who may or may not be wearing masks and may or may not be vaccinated. And that’s why you see some of that increase in wages as well as help-wanted signs outside McMenamins. They’re paying a premium for the risk that people are going to take.