As Americans find it harder and harder to purchase Christmas gifts, replace broken appliances, or eat at their favorite restaurant because of the ever-emptying store shelves and ever-increasing prices, CNN commentator Fareed Zakaria claimed that the U.S. labor shortage is “just the kind of chaos the American economy needs.”
While Zakaria cited an economist who argued the lack of shortage is actually a good thing for the U.S. economy, economic data show the massive dearth of workers has raised prices, curtail services, and further stressed Americans who stayed at their jobs.
“Welcome to Strike-tober,” said Fareed Zakaria on Sunday — using a term coined by labor unions to celebrate the mass walkouts that have idled factories in the midst of a global supply chain crisis. “Last week 10,000 workers of the farm equipment manufacturer John Deere went on strike … [and] 1,400 workers at Kellogg’s have been striking for weeks,” he said. Zakaria did not mention that the strikes halted production at both companies, leaving farmers scrambling for equipment and paying tens of thousands of dollars more for used tractors than in years past.
But the U.S. shortage, which resulted in 10.4 million unfilled jobs, goes beyond organized labor to throngs of Americans temporarily quitting their jobs or permanently leaving the workforce.
“Most workers in the U.S. are not unionized, so they may not be inclined to organize a strike. But that doesn’t mean they can’t walk off their jobs,” said Zakaria. “Since April, an average of about four million workers have quit their jobs every month. It is a trend economists have called the Great Resignation.”
August’s “quit rate” of 4.3 million people is the highest in at least two decades, and 3.6 million more unemployed Americans say they are not looking for a job compared to pre-pandemic levels.
That has significantly impacted employees, the employers who pay them, and the consumers who buy their products. Americans who have not taken part in the Great Resignation must work longer, and harder, to pick up the slack for an understaffed business.
The average worker in manufacturing works nearly an hour-and-a-half more overtime now compared to last April. Meanwhile, many businesses are closing early or not opening one or more days a week due to staffing shortages: 80% of restaurants closed early in Michigan over the summer due to a lack of workers, according to a survey from the Michigan Restaurant & Lodging Association
Zakaria said the worker shortage is “actually good news,” because it lets workers demand higher wages.
“Low-skilled American workers … make almost one-third less per hour than their counterparts in Canada,” Zakaria said — without mentioning that the total tax burden in Canada is far higher in the United States. The combined marginal tax rate for workers making $50,000 Canadian ($40,500 U.S.) is higher in any Canadian province than in all 50 U.S. states, according to a 2020 study from Canada’s Fraser Institute.
Economic data show that higher wages have not attracted enough job applicants. Instead, in numerous industries hourly wages rose, employment fell, and the price charged to consumers rose. The Wall Street Journal reported:
Nationwide, employment at restaurants and bars was down by 930,500 jobs, or 7.6%, in September from February 2020; hourly pay was up 12.7% between February 2020 and August 2021. … Restaurant meals were 7.3% more expensive in September than in February 2020. …
Hotels employed about 290,000 fewer people in August than in the month before the pandemic, a drop of 17%, and were paying the employees they had an average of $20.83 an hour in August, up 13.3% since before the pandemic.
Yet Zakaria contended that America is on the right track economically. “So, Striketober — terrible word — and the Great Resignation may look chaotic, but this is just the kind of chaos the American economy needs,” Zakaria concluded.
The views expressed in this piece are the author’s own and do not necessarily represent those of The Daily Wire.
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Source: Dailywire
