The city government of Chattanooga, Tennessee, will be stopping curbside recycling pickup starting July 30 due to employee shortages.
The recycling collection service will be suspended until the city is able to fill 32 open commercial driver positions, it said Thursday on Twitter. City officials are recommending residents personally deliver their recycling to Chattanooga’s recycling drop-off centers.
The starting pay for CDL (commercial driver’s license) truck drivers is $29,865 – 118% less than the starting pay for drivers recruited by local pickup companies, according to a presentation the mayor’s office made to the Chattanooga city council earlier this week.
The office also presented data that most qualified job candidates are turning down these vacant municipal positions, some of which have been unfilled for more than two years, because of the pay. The city is then forced to hire less-qualified applicants who require more training and manager supervision worker.
“The impact to recycling due to our driver shortage illustrates one of Chattanooga’s most acute problems,” said City of Chattanooga’s Chief of Staff Brent Goldberg. “Pay for city employees is far below the market rate, a problem our budget will address when we present it to [Chattanooga’s] City Council in August.”
A wave of employee retirements, resignations, and COVID-19 illness may contribute to further public work disruptions, according to city spokesman Ellis Smith.
“In spite of supervisors filling in on a regular basis, garbage and brush pick-up could also be impacted if the driver shortage continues to grow worse,” Smith said.
The tweet also linked to an external top application page where people can apply for one of the open pickup driver positions. Applicants will need to have a commercial driver’s license to apply.
Even with its massive scale, Amazon is still a distant second to the country’s largest private employer, Walmart, which employs nearly 1.6 million people in the US, or one out of every 91 workers.
While it’s possible that more people work at a McDonald’s than either Amazon or Walmart – the fast-food brand estimates more than 2 million globally – the company primarily operates on a franchise model, so it directly employs less than 50,000 in the US.
Along with Amazon’s size, its decision to implement a $15 minimum wage across the company has had a measurable effect in the communities where it does business. It has also forced other large employers to follow suit.
But last month, a New York Times report found that Amazon had a turnover rate of about 150% every year among hourly employees, leading some executives to worry about running out of hirable employees in the US.
In other words, with so many current and former Amazonians in the US, there’s a good chance that you know someone who’s worked there.
Nearly one in five flight attendants has been in a physical altercation with unruly passengers this year.
In a survey of 5,000 flight attendants by the Association of Flight Attendants-CWA union, 17% reported experiencing a physical incident in the first half of 2021.
More than 85% of respondents said they had dealt with unruly passengers this year, and 61% of flight attendants said they heard racist, sexist, or homophobic slurs during altercations.
“This survey confirms what we all know, the vitriol, verbal and physical abuse from a small group of passengers is completely out of control, and is putting other passengers and flight crew at risk,” said Sara Nelson, president of AFA-CWA. The union is asking for more support from federal agencies, including the Department of Justice and the Federal Aviation Administration.
“It is time to make the FAA ‘zero tolerance’ policy permanent, the Department of Justice to utilize existing statute to conduct criminal prosecution, and implement a series of actions proposed by our union to keep problems on the ground and respond effectively in the event of incidents,” Nelson said.
The AFA survey found 71% of flight attendants who filed incident reports received no follow-up and a majority “did not observe efforts to address the rise in unruly passengers by their employers.”
About 75% of reports of aggressive passengers involved disputes over masks, the FAA said. President Joe Biden mandated Americans wear masks while flying soon after taking office.
But Nelson said “this is not just about masks as some have attempted to claim. There is a lot more going on here and the solutions require a series of actions in coordination across aviation.”
Several flight attendants said their mental health has deteriorated due to the increase in passenger aggression. A Harvard psychologist told Insider’s Avery Hartmans the aggression stems from the fear and anxiety COVID-19 placed on Americans the past year and a half.
“This is not a ‘new normal’ we are willing to accept,” said Nelson, the union president. “We will be sharing survey findings with FAA, DOT, TSA, and FBI to help more fully identify the problems and our union’s proposed actions to affect positive change.”
The labor shortage is tough on the economic recovery. Consumers are spending and employers want to hire, but jobs can’t get filled fast enough right now.
There’s several signs that suggest the labor shortage will end soon, according to a Thursday note by the UBS Evidence Lab. But there’s one big reason it might not.
UBS’s Andrew Dubinsky, Pablo Villanueva, and Samuel Coffin wrote in a Thursday note that the labor shortage might be ending soon, given the increase in job openings and decline in retirement rates, among other things.
According to UBS, here are the three signs that the labor shortage could be ending:
Job openings keep rising
The indicator that makes “the best case for continued strong job gains is job openings which have continued to increase through the end of May,” the economists wrote.
They also note a drop in quit rates, which could suggest stable hiring rates accompanied by the job gains in May and June. The latter month added 850,000 payrolls, in the clearest sign that the shortage may be easing.
Insider previously reported that a factor behind the job openings could be workers holding out for higher wages, and given that a number of companies are beginning to increase wages to get people back to work, more jobs will likely be filled as a result.
Retirements may have peaked
UBS found that retirements may have peaked for those aged 70 and older, which could help explain why participation rates are low.
Other factors, like fear of contracting the virus and disruptions to childcare, are temporarily limiting the return to the workforce, the economists wrote, but they are expected to improve in the coming months.
Service jobs added to the high level of job openings
The leisure and hospitality sector made up 40% of the total job gains in June, adding 343,000 payrolls, showing a promising sign for job growth in the service industry.
Pay in the sector also jumped 3.6% over the past three months, and the correlation between increased jobs and increased wages is suggesting that higher wages work. For the month of June, wages shot up 7.1% from a year ago, the biggest gain for any sector.
But these promising signs for the end to the labor shortage could be jeopardized by one thing: bottlenecks.
Bottlenecks occur when an industry has to slow its growth because it cannot keep up with demand, and the economists wrote that if bottlenecks don’t fade, the labor shortage will likely persist. Job fillings remain slow from the bottleneck caused by the pandemic recession, but the drop in quit rates, along with wage gains, suggest bottlenecks might be fading, UBS said.
“If bottlenecks fade, openings and listings gains imply job growth trends should remain strong,” it said.
President Joe Biden is set to crack down on employers who collaborate to suppress workers’ wages in an executive order scheduled for Friday.
The White House published details of the upcoming order Friday morning. Biden will push the Federal Trade Commission (FTC) and the Department of Justice (DOJ) to “prevent employers from collaborating to suppress wages or reduce benefits” by sharing wage and benefit information with each other.
The executive order will say that workers may be “harmed” by existing DOJ and FTC guidance that allows third parties to make wage data available to employers in certain circumstances without triggering antitrust scrutiny, per the White House’s notes.
Workers’ wages tend to decrease when there are fewer employers competing with each other for their labor, according to research from the University of Pennsylvania.
The order, which focuses on promoting economic competition, will aim to help more businesses break into markets dominated by large employers, which it says should give workers more chance to negotiate higher pay.
The president has urged Congress to pass the Protecting the Right to Organize Act, which would include protections for workers who want to unionize and collectively bargain for better pay.
In Friday’s order, Biden will also call for the FTC to ban or limit non-compete agreements and “unnecessary, cumbersome” occupational licensing restrictions. These would make it easier for workers to change jobs and help raise wages, per the White House’s briefing notes.
Tens of millions of Americans, including people working in construction and retail, have to sign non-compete agreements as a condition of getting a job, which makes it harder for them to switch to better-paying options and “stifles” competition, the order will say, per the White House.
It will also say that nearly 30% of jobs in the US require an occupational license, and that there is huge disparity in license requirements between states, which makes it difficult for people to move between states.
Biden has appointed Lina Khan, a vocal critic of big tech, as FTC chair in a decision widely thought to signal his administration’s desire to bring in strict antitrust rules to prevent tech companies from monopolizing markets.
On June 15, player advocacy group Advocates for Minor Leaguers called out the Baltimore Orioles for their treatment of Double-A affiliate the Bowie Baysox.
Baysox players, Advocates for Minor Leaguers tweeted, were “considering sleeping in their cars” because the team wouldn’t pay for housing and the cost of a hotel would come to 80% of their two week paycheck after taxes.
Hours later, players were informed that the price was now actually half of what they had been initially told to expect. Orioles executive vice president and general manager Mike Elias denied to the press that the players had ever been in danger of sleeping in their cars, telling reporters that was just “not accurate.”
It’s hard to take that denial seriously, however. Minor League players have been subjected to mistreatment and poor pay for decades. Congress codified that maltreatment in 2018, including a provision in the $1.3 trillion Consolidated Appropriations Act that exempts teams from having to pay minor leaguers overtime or for spring training. The deck is stacked against minor league players, who are fighting for an elusive chance to make it to the majors and a real paycheck.
This is the American way. Around the country, workers are subjected to poor conditions, worse pay, and sold unrealistic promises of better futures. Rich owners of baseball teams deny their employees in the minors adequate pay and shelter despite the relatively low cost of doing so – just like billionaires like Jeff Bezos overwork and underpay their employees in other industries.
Food and Shelter
Minor League players face difficult working conditions, Advocates for Minor Leaguers executive director Harrison Marino told me. Most players make about $15,000 a year – seasonal pay that comes with a contractual obligation to perform services all year. Many, if not most, minor leaguers have to find other jobs in the offseason just to make ends meet while they continue to train.
Housing is extremely difficult given the rung-by-rung movement of most minor leaguers towards the majors and for the pittance they are paid. While teams pay for player accommodations on the road, players are expected to provide for themselves and find housing as needed when playing at home. This presents myriad issues, not least that a player can bounce around from city to city as they advance in their career because a team’s affiliates will not be all in one region.
For instance, a player in the San Francisco Giants organization would in theory have to travel from its Low-A affiliate team – the first rung on the minor league ladder – in San Jose to its High-A team in Eugene, Oregon (562 miles away) to its Double-A team in Richmond, Virginia (a 2,873 mile trip), and finally to the Triple-A team in Sacramento (a 2,783 mile trip). All while finding new housing every time they move up (or down) levels.
The food situation is often hardly better. On June 1, Advocates for Minor Leaguers posted photos from Oakland Athletics minor leaguers showing their post-game meals: a cheese sandwich from May worthy of the infamous Fyre Festival and, more recently, what appeared to be an attempt at a taco. The A’s claimed they had ended the relationship with the vendor, “several weeks ago.”
There’s not much players can do.
“Because players are tied to their MLB club for seven seasons, they can’t seek a better deal with a different club,” Marino told me. “When it comes to MLB teams’ treatment of Minor League players, it really is a race to the bottom.”
Because of its monopolistic position over the sport of baseball, Major League Baseball is the only viable buyer for baseball player labor. That gives the league outsized power and control over its labor pool to an extent most other companies can only dream of. In practice, this means a relationship between worker and boss that is tilted overwhelmingly toward the powerful.
Minor leaguers have faced an extreme version of that relationship for decades. Steve Hamilton, a major leaguer, told Studs Terkel in 1974’s “Working” that the unbalanced relationship between players and owners was even harder on the players in the minors – who didn’t, and don’t, have a union, unlike major league players.
“They insist on knowing you as a thing,” said Hamilton. “It’s easy for them to manipulate.”
Poor treatment and low pay are endemic in nearly every US industry, and the tension between how workers are treated and business owners are compensated has become more and more apparent in recent years. Conversations around income inequality that exploded into the mainstream more than a decade ago have matured and begun to target the systemic underpinnings of the American economic system.
Baseball isn’t even the worst offender. The gig economy, particularly driver services like Uber and Lyft, has led to a less stabilized and less secure workforce even as the people at the top of those companies rake in profits. Hourly pay for a driver at Uber – like Minnesota Twins pitcher Randy Dobnakout did before getting signed – comes to a little under $10 an hour after taxes, according to an EPI study; the company further depresses wages by refusing, unless forced, to provide benefits for workers.
Companies around the country dangle the opportunity of promotions and power in front of workers in order to entice them into dead-end jobs because, technically, the possibility exists that they can advance – though only around 10% will. But for the majority of working people in the US, the American dream seems barely worth imagining.
No wonder, then, that there’s a labor shortage. The service industry is facing severe difficulty in getting people to return to work, and the response from many restaurateurs and caterers is to call for an end to COVID-related unemployment benefits. The song remains the same: for bosses and owners, the workers are disposable, whether they’re short order cooks, drivers for Uber, or minor league baseball players,
“Baseball occupies a unique position in our cultural landscape,” Marino said. “For the past 150 years, labor relations in baseball have both reflected and shaped labor relations in the United States more broadly.”
Today, conditions are better than they were in the past – the plight of the Minor League players notwithstanding. But the deck is still stacked against workers, just as it is across almost every industry in America.
While the June jobs report exceeded expectations, adding 850,000 payrolls, it also blew up a developing narrative that teenagers were helping solve the country’s labor shortage.
According to Bureau of Labor Statistics data, teen unemployment rates in April and May were at 12.3% and 9.6%, respectively, signaling that in the spring, teenagers were jumping into the labor force. But the unemployment rate for the 16-19 age group sat at 9.9% in June, suggesting the trend might not continue throughout the summer.
The New York Times economics reporter Ben Casselman wrote on Twitter that in the spring, teen employment was well above pre-pandemic levels, but with their employment level in June fairly close to the pre-pandemic level, teens likely won’t be boosting labor supply.
The following chart shows employment for 16 to 19 years old in May from 2015-2021:
The following chart shows employment for 16 to 19 years old in June from 2015-2021. Employment in June 2021 seems to be similar to levels seen in 2019.
US business owners have been flocking to hire teens amidst a labor shortage, according to a Wall Street Journal report in early June, as teen unemployment rates in the US were at their lowest level since 1953 following the May jobs report, and the number of teens in work had reached the highest rate since 2008.
The labor shortage had given teens the opportunity to cherry-pick for the best-paying jobs. As Ric Serrano, CEO of Serrano’s Mexican Restaurants, told the Journal, “It’s a perfect storm for them.”
Another restaurant owner, Ben Eli – who owns Doris Metropolitan steakhouses in Houston and New Orleans, told the Journal that he had been significantly struggling to find workers, and he’s only been able to hire teens.
“I’ve never seen anything like this,” he said. “They are 100% of my staffing right now.”
Employees are definitely coming back to work, though, and restaurants may not have to rely on teenagers to keep service afloat. June’s jobs report revealed a 343,000 payroll gain in just the leisure and hospitality sector, largely thanks to increased wages for those workers in the industries that teenagers had mainly staffed.
And President Joe Biden saw this as a promising sign moving forward in economic recovery.
“More jobs, better wages – that’s a good combination,” Biden said during his remarks on Friday. “Put simply: Our economy is on the move, and we have COVID-19 on the run.” While this may be true, teens may not be leading the charge after June.
The June jobs report added 850,000 payrolls, going beyond expectations as the economy continues to recover from the pandemic. A large chunk of the big jobs gain came from leisure and hospitality, and the reason for this likely comes down to higher wages.
Of the 850,000 payrolls added, leisure and hospitality made up 343,000 of them, or 40% of the total gain. Pay in the sector jumped 3.6% over the past three months, and the correlation between increased jobs and increased wages is suggesting that higher wages work. For the month of June, wages shot up 7.1% from a year ago, the biggest gain for any sector.
“The continued progress for the leisure and hospitality sector is excellent news. Continued payroll gains for these industries hit so hard by the pandemic is a sign that more workers can quickly return to work,” Nick Bunker, economic research director for jobs site Indeed, wrote in a statement. He added that 23% of gains added overall last month were from food services and drinking places.
Despite the fifth consecutive month of gains in the industry, leisure and hospitality is still 2.2 million jobs, or 12.9%, below pre-pandemic employment. However, Bunker told Insider that given the progress made in the industry, it looks like the pace of recovery is pretty quick.
Following the April jobs report that fell significantly below expectations, Insider reported that one of the possible reasons workers weren’t rushing back to work, despite a high number of job openings, was that they were holding out for higher wages.
Around the same time, major companies including Costco and Target have raised their minimum wages to at least $15 an hour, putting pressure on other employers to follow suit.
But, as Heidi Shierholz, a former Obama administration economist and now director of Policy at the Economic Policy Institute, pointed out on Twitter, wages for workers in leisure and hospitality “plummeted” last year during the recession, so even with the strong wage growth in those sectors this year, wages are not that much higher than if the pandemic had never happened.
“Over the last three months, leisure & hospitality has added 977,000 jobs-well over half of the 1.7 million total jobs added over that period,” Shierholz wrote. She added that these numbers “are just not signaling a big labor shortage.”
In an attempt to remedy the labor shortage, GOP-led states have been ending unemployment benefits early under the argument the benefits are disincentivizing the return to work. But June’s jobs data were collected before some of the cuts went into effect, meaning benefits might not have been the problem, rather, low wages were.
Betsey Stevenson, another former economist for the Obama administration, wrote on Twitter that the solution to finding workers is simply offering a higher wage.
“So it turns out that you can find workers, you just have to pay a better wage than in the past because wages of low-wage workers are going up.”
As the economy is beginning to recover from the pandemic, there’s a record number of job openings, but that’s not the big story, former Obama economists wrote in a paper released Monday.
The big news is that so many of the unemployed are exiting unemployment, but not for jobs. That isn’t normal.
Jason Furman, chair of the Council of Economic Advisers under President Barack Obama, and Wilson Powell III, former research economist at the council, released a paper for the left-leaning Peterson Institute, looking into the unemployed who aren’t returning to work despite a record number of job openings. It found that since September 2020, transition from employment to unemployment has been lower than the norm, most recently at 24%.
Based on the historic relationship between job openings and the transition from unemployment to employment, they wrote, about 34% of the unemployed in April 2021 should have transitioned to employed in May 2021, resulting in 1 million more unemployed people finding jobs per month.
“This is notable because normally one would expect the transition rate from unemployment to increase as more jobs became available, as measured by the job openings rate,” Furman and Powell wrote. “In fact, the current transition rate is closer to what one would expect with an openings rate of 3 percent, only about half of the current openings rate.”
The economists added that “at the very least, there is no reason the transition rate should not be around, say, 29 percent, the 80th percentile of its historical value.” At that level, an extra 500,000 people would have transitioned from unemployed to employed each month.
So what are the causes of this shortfall?
Insider previously reported that President Joe Biden’s $300 weekly unemployment benefits could be disincentivizing the return to work, although COVID-19 health concerns, lack of childcare, and workers holding out for higher wages can’t be discounted as other factors.
Furman and Powell wrote that the low transition rate is likely temporary, thought. Similarly, Insider’s Ben Winck has reported on the potential benefits of the record number of people quitting jobs, suggesting a future of higher wages for workers and increased productivity.
“The good news is that most of the factors holding back transitions from unemployment are probably temporary, and if the rate at which people are leaving unemployment for jobs returns to what would be expected given the overall strength of the economy, the pace of job growth could rise to 750,000 or more a month,” Furman and Powell wrote. “There may be a speed limit on job growth, but it is likely to be well above the recent pace.”
Many of the over 350,000 workers Amazon hired from July to October stayed with the company “just days or weeks,” the report said.
An Amazon warehouse employee in Michigan told Insider that “almost everybody I know [at Amazon] is looking for another job.”
Insider spoke with half a dozen current and former Amazon employees across the country who work in a variety of fulfillment center roles about why they think the company has such high attrition rates. They all cited similar issues: The monotonous nature of the work, the surveillance of their productivity, and rapid burnout. Though they requested to remain anonymous, Insider confirmed their identities and verified their employment records.
“I lasted longer than anybody else in my group that had started” at the same time, a former seasonal employee in Washington, who worked at a fulfillment center from September to October 2020, told Insider. “The entire group of people that I was hired with did not make it two weeks. I was literally the only one [of 23 people].”
Specifically, the current and former employees pointed to entry-level warehouse jobs as most ripe for turnover, including “pickers” – the people who pick items for orders, pack those orders into boxes, and get those boxes loaded into trucks.
“It’s super tedious, and no one wants to do it,” the employee in Michigan said.
“As a picker, they want you to pick 4,000 items a shift … and you’re stuck at one station for 10 hours with two 30-minute breaks,” they said. “You’re sore at first, and you think it’s okay. Imagine working here four days a week, you’re doing that same thing over and over again: Picking 4,000 items. It wears out.”
Amazon employees also cited the company’s notoriously dogged approach to efficiency, in which the company uses technology to track workers’ productivity and timeliness. Being just five minutes late to clocking in results in a write-up from management, several employees said.
“You’re constantly trying to defend your employment,” a former Amazon employee in California told Insider.
Prior to the pandemic, hourly employees had a turnover rate of about 3% weekly, or roughly 150% annually, data reviewed by The Times indicated. That reportedly led some Amazon executives to worry about running out of hirable employees in the US.
An Amazon representative told the Times, “Attrition is only one data point, which when used alone lacks important context.” The company did not respond to Insider’s request for comment.
Amazon went on an extended hiring spree in 2020 as it attempted to keep up with a massive spike in demand during coronavirus lockdowns. As Americans increasingly turned to Amazon for things like toiletries and groceries, the company repeatedly touted major hiring pushes.
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