Is the financial cure worse than the disease?


Here on Cape Cod there are more HELP WANTED signs than daffodils out on the side of the roads. Traditionally, in a deal going back to the Cold War, seasonal shortages are supplemented by summer visas for young Bulgarians learning to speak English. COVID put paid to that. Now we are seeing some islanders from the Caribbean show up – but not enough to fill all the restaurant and leisure jobs required to keep this summer paradise from working properly. Things are so bad the restaurants are offering signing bonuses.

Here’s why. Unemployment benefits typically replace about 40% of workers’ wages, on average. But now, many laid-off Americans are receiving bigger checks from unemployment than they did from their jobs, thanks to the $2 trillion coronavirus relief package passed by Congress in March. The bill included a historic $600 boost to weekly payments, on top of state benefits, that lasts for up to four months.In 38 states, the combined payment is equal to or larger than the average weekly wage for the jobs that were lost. On the high end, the combined state and federal unemployment benefit covers 129% of lost wages, on average, in Maine and New Mexico.

Naturally farm hands, slaughter men, wait staff, shop assistants and other workers who are currently being paid more to stay home that return to work are taking their time about it. The problem? Will the jobs still be there when the boondoggle money runs out?

Jarrett Twigg is the co-owner of The Provincial in Apex, NC. He says staffers are getting a lot of money to sit at home and have no reason to go through the rigors of life in the restaurant business. So, he loses business.