Valley businesses say development is stunted by labor shortage
By: Marcia Moore, DailyItem
Valley business is booming, but companies are concerned their growth is being stunted by the limited applicant pool.
The labor shortage is "a significant problem," said Jennifer Wakeman, executive director of DRIVE which serves Northumberland, Snyder, Union, Montour and Columbia counties. She's seen business pick up substantially in the past eight months while at the same time the labor pool has been shrinking.
The past several months have been the hardest to recruit new employees at Apex Homes of Pennsylvania, said Lynn Kuhns, president of the Middleburg company which has about 20 open positions.
"We used to get four, five, six applications a day. Now we're down to four in the last three weeks. It's the worst I've ever seen," he said. "It minimizes our ability to grow. And it's not just in our industry, it's everyone. It's a sad situation."
Andrew Oakes, the owner of Fresh Roasted Coffee in Sunbury, has also struggled to recruit and retain new employees despite offering positions paying above the minimum wage and full benefits.
On Thursday, two of five scheduled interviewees for jobs failed to show up, he said, and several people who were offered jobs in recent weeks opted not to accept because they said they could make as much or more on unemployment, which currently offers an additional $300 during the COVID-19 pandemic
Oakes and Kuhns said they have or are reaching out to local, state and federal leaders about the issue.
U.S. Rep. Fred Keller has met in the last several weeks with several Central Pennsylvania businesses, including Penn Dairy, in Winfield, and chambers of commerce officials.
“Our team has made a priority of connecting with small businesses and local chambers of commerce" across the district, "listening to their concerns, and using their feedback to inform my work as ranking member of the Education and Labor Workforce Protections Subcommittee," he said. " What we’ve seen and heard from businesses across our district is they are eager to hire, but many are still struggling to recruit workers. Our region is home to several career and technical education institutions that do a great job teaching students the skills necessary for in-demand jobs. We should be encouraging students to pursue these opportunities."
Keller also expressed concern about legislation that pays people more not to be in the workplace during the pandemic.
"The people of central and northeastern Pennsylvania are hardworking, diligent people who know the best kind of stimulus is a job, and we need to get Americans back to work to sustain our economic recovery," he said.
Penn Dairy Manager Jon Weber said the company, founded in 1979, offers a good starting wage — $13.25 an hour with no experience — but still has a few positions available.
"Transportation and child care is definitely always a challenge, and the government giving away money doesn't help, but at the heart of it is (employees) who don't have a strong spouse at home," said Weber. "I don't think the government can help but encourage" families staying together.
Despite the need for workers in sectors ranging from health care to manufacturing, Pennsylvania’s unemployment rate remained at 7.3 percent in February, according to figures released Friday by the state Department of Labor and Industry. According to its figures, the national unemployment rate declined one-tenth of a percentage point from January to 6.2 percent. The commonwealth’s unemployment rate was 2.3 percentage points above its February 2020 level while the national rate was up 2.7 points over the year.
Oakes said he doesn't want to enter the political fray but worries what will happen if the additional $300 in unemployment compensation is extended in April "because it's hurting my ability to hire and increase our business," he said, adding he has a new machine in his plant "that I just can't turn on" because of the lack of workers.
The labor shortage reaches beyond the Valley.
Kinexus Group, a Michigan-based workforce and economic development organization, has studied the issue during the pandemic and found that many in the U.S. are choosing not to go back to work.
"Extending unemployment benefits means some people may wait a little bit longer," said Al Pscholka of Kinexus Group.
Wakeman said she's heard from Valley business owners who complain that employees are turning down work to stay home and collect unemployment compensation, but said there are many other factors at play, including lack of reliable or public transportation, child care and health concerns during the pandemic
"With schools in and out of session during the pandemic, it's been hard for people. I suspect there are also people who don't want to go to work until they are vaccinated," she said.
The Kinexus Group study also found that fear of COVID-19 is playing a part in the employee shortage.
Chris Bingaman, co-owner of Bingaman & Son Lumber Inc., said the Kreamer company offers a four-day workweek to aid in recruitment but it hasn't helped fill four available nightshift positions.
"Right now people have a lot of options because everyone is looking for people," he said.
Maurice Brubaker launched a new high-end cabinet manufacturing business, William Penn Cabinetry, in Freeburg last year and hopes to buck the trend by offering a starting salary of $16 and full benefits as the company gears up to hire 208 employees through the fall.
"With all the radio ads, billboards and road signs (advertising jobs), it reminds me what happened back in the 1990s," he said of the many 'help wanted' and hiring advertisements in the media and dotting the roadways. "We'll have to fight for the best."
And, despite William Penn Cabinetry's offer of high wages and benefits, Brubaker said there have been a few new hires who just haven't shown up for work.
Kuhns said he's also had trouble keeping new hires on the job. About 60 percent of his 120 employees at Apex have 15 years or more experience, but Kuhns said several new employees have failed to show up for a single day of work and another well-regarded new hire that was on a fast track for promotion decided to quit rather than work an extra 10 hours per week.
"I understand people want a better life but they're only looking out for today rather than tomorrow and next year," Kuhns said.