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    Supply Chain Shortages Help a North Carolina Furniture Town

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    The furniture capital of the state is ground zero for inflation, labor shortages, hot demand and limited supply. It’s debating how to cope.HICKORY, N.C. — Six months into the coronavirus pandemic, as millions of workers lost their jobs and companies fretted about their economic future, something unexpected happened at Hancock & Moore, a purveyor of custom-upholstered leather couches and chairs in this small North Carolina town.Orders began pouring in.Families stuck at home had decided to upgrade their sectionals. Singles tired of looking at their sad futons wanted new and nicer living room furniture. And they were willing to pay up — which turned out to be good, because the cost of every part of producing furniture, from fabric to wood to shipping, was beginning to swiftly increase.More than a year later, the furniture companies that dot Hickory, N.C., in the foothills of the Blue Ridge Mountains, have been presented with an unforeseen opportunity: The pandemic and its ensuing supply chain disruptions have dealt a setback to the factories in China and Southeast Asia that decimated American manufacturing in the 1980s and 1990s with cheaper imports. At the same time, demand for furniture is very strong.In theory, that means they have a shot at building back some of the business that they lost to globalization. Local furniture companies had shed jobs and reinvented themselves in the wake of offshoring, shifting to custom upholstery and handcrafted wood furniture to survive. Now, firms like Hancock & Moore have a backlog of orders. The company is scrambling to hire workers.“Not to sound trite, but it’s unprecedented,” said Amy Guyer, vice president for human resources and benefits for the parent company that includes Rock House Farm furniture brands such as Hancock & Moore and Century Furniture.Yet the same forces that are making it difficult for overseas manufacturers to sell their goods in the United States — and giving American workers a chance to command higher wages — are also throwing up obstacles.Many of the companies are dependent on parts from overseas, which have been harder — and more expensive — to obtain. Too few skilled workers are seeking jobs in the industry to fill open positions, and businesses are unsure how long the demand will last, making some reluctant to invest in new factories or to expand to towns with bigger potential labor pools.“We would love to expand capacity,” Ms. Guyer said, “but we’re the furniture mecca of North Carolina — every other furniture company is in the same boat we are.”Even if there were enough workers, said Alex Shuford, the chief executive of the company that owns Rock House Farm furniture brands, “the surge isn’t going to last as long as it would take to go to a completely trained work force and get them up to speed.”The current moment, he added, “is abnormal in every way, and not sustainable in any way.”For now, companies in Hickory are seeing a huge upswing thanks to strong demand and limited supply. Prices for couches, beds, kitchen tables and bedding have shot up this year, climbing by 12 percent nationally through October. Furniture and bedding make up a small slice of the basket of goods and services that the inflation measure tracks — right around 1 percent — so that increase has not been enough to drive overall prices to uncomfortable levels on its own. But the rise has come alongside a bump in car, fuel, food and rent costs that have driven inflation to 6.2 percent, the highest level in 31 years..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-1kpebx{margin:0 auto;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-1kpebx{font-size:1.25rem;line-height:1.4375rem;}}.css-1gtxqqv{margin-bottom:0;}.css-19zsuqr{display:block;margin-bottom:0.9375rem;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}The question for policymakers and consumers alike is how long the surge in demand and the limitations in supply will last. A key part of the answer lies in how quickly shipping routes can clear up and whether producers like the craftsmen in Hickory can ramp up output to meet booming demand. But at least domestically, that is proving to be a more challenging task than one might imagine.The production floor at Century Furniture’s case goods factory in Hickory.Travis Dove for The New York TimesA Century Furniture upholstery plant in Hickory. Demand for furniture is booming, and domestic producers are raising prices.Travis Dove for The New York TimesOn a wet morning in late October, the sound of electrical sanders whirring and the steady thunks of a craftsman planing a chair leg echoed through one of Century Furniture’s cavernous warehouses. The factory once housed 600 workers tending assembly lines. Now about 250 busily construct tables, chairs and desks.The plant typically has 2,000 orders in the pipeline, but these days that is more like 4,000, said Brandon Mallard, its manager. Deliveries of ordered furniture used to happen within six to eight weeks; now they can take six months.The same supply chain problems afflicting nearly every industry are also hitting Century. Dresser drawer handles are trapped on container ships somewhere between Vietnam and North Carolina. For some products, imported wood has faced delays.Component delivery dates “just keep moving out,” Mr. Mallard said.Labor has also been a challenge. Employees at Century have been working overtime to catch up with the backlog, but workers burn out, and furniture margins are so thin that paying overtime labor rates can eat into profits. Several of Mr. Shuford’s brands have been raising prices, but because pieces are preordered weeks or months in advance, they have sometimes failed to increase them quickly enough to keep up. The experience in Hickory is a microcosm of what is playing out on a larger scale across the global economy.Jonathan Smith is studying upholstering at the Catawba Valley Furniture Academy. Too few young people are entering the furniture industry to replace those who are retiring. Travis Dove for The New York TimesDemand has bounced back after falling early in the pandemic, fueled by government stimulus checks and savings amassed during the pandemic. Spending has lurched away from services and toward goods, and that mix is only slowly normalizing.The sudden change has thrown a finely balanced global supply chain out of whack: Shipping containers have struggled to get to stockyards where they are needed, container ships cannot clear ports quickly enough, and when imported goods get to dry land, there are not enough trucks around to deliver everything. All of that is compounded by foreign factory shutdowns tied to the virus.With foreign-made parts failing to reach domestic producers and warehouses, prices for finished goods, parts and raw materials have shot higher. American factories and retailers are raising their own prices. And workers have come into short supply, prompting companies to lift their wages and further fueling inflation as they increase prices to cover those costs.Chad Ballard, 31, has gone from making $15 per hour building furniture in Hickory at the start of the pandemic to $20 as he moved into a more specialized role.Mr. Ballard said he came to town four years ago after working construction jobs and at tree services in Florida. He was ready for something more stable and less weather-exposed, and he found it in furniture making. The job has provided stability and enough financial security that he was able to pay off his Jeep and make plans to buy a house with his wife, who also works in the industry.But there is a flip side to some of the factors that are helping to buoy workers like Mr. Ballard: If inflation continues to rise in the hot-demand economy, it will mean rising costs for them and other consumers that eat into paychecks and make it harder to afford everyday necessities like food and shelter. Already, the heating economy means that Mr. Ballard’s goal of buying a house will be slightly tougher. The typical price for a house in Hickory has shot up 21 percent over the past year to $199,187, according to data from Zillow.Fabric and leather templates for furniture designs at a Hancock & Moore factory in Taylorsville, N.C.Travis Dove for The New York TimesBeverly Houston organized pieces of leather as they came off the cutting machine at the Hancock & Moore factory.Travis Dove for The New York TimesAs price increases drag on, economic policymakers worry that consumers and businesses might come to expect sustained inflation and demand steadily higher pay, resulting in a spiral where wages and prices push each other up.There is reason to believe that such a dire outcome can be avoided. Many economists, including those in the Biden administration, believe that demand will eventually moderate as life shifts back toward more normal patterns and consumers spend down their savings, allowing supply to catch up — possibly by the end of next year.Understand the Supply Chain CrisisCard 1 of 5Covid’s impact on the supply chain continues. More

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    For Afghan Refugees, a Choice Between Community and Opportunity

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    FREMONT, Calif. — Harris Mojadedi’s parents fled Afghanistan’s communist revolution four decades ago and arrived as refugees in this San Francisco suburb in 1986, lured by the unlikely presence of a Farsi-speaking doctor and a single Afghan grocery store.Over the decades, as more refugees settled in Fremont, the eclectic neighborhood became known as Little Kabul, a welcoming place where Mr. Mojadedi’s father, a former judge, and his wife could both secure blue-collar jobs, find an affordable place to live and raise their children surrounded by mosques, halal restaurants and thousands of other Afghans.“When I went to school, I saw other Afghan kids. I knew about my culture, and I felt a sense of, like, that my community was part of Fremont,” Mr. Mojadedi recalled recently over a game of teka and chapli kebabs during lunch with other young Afghans from the area.But now, as the United States begins to absorb a new wave of refugees who were frantically evacuated from Kabul in the final, chaotic days of America’s 20-year war in Afghanistan, it is far from clear that a place like Fremont would be an ideal destination for them. Housing in the Bay Area city is out of reach, with one-bedroom apartments going for more than $2,500 a month. Jobs can be tougher to get than in many other parts of the country. The cost of living is driven up by nearby Silicon Valley. Even longtime residents of Little Kabul are leaving for cheaper areas.The alternative is to send the refugees to places like Fargo, N.D., or Tulsa, Okla., where jobs are plentiful, housing is cheap and mayors are eager for new workers.But those communities lack the kind of cultural support that Mr. Mojadedi experienced. The displaced Afghans would most likely find language barriers, few social services and perhaps hostility toward foreigners. Already, there are signs of a backlash against refugees in some of the states where economic statistics suggest they are needed most.Homaira Hosseini is a lawyer and Afghan refugee who grew up in Little Kabul.Gabriela Bhaskar/The New York TimesHarris Mojadedi’s parents fled Afghanistan after its communist revolution four decades ago and settled in Little Kabul.Gabriela Bhaskar/The New York TimesHousing is out of reach for many in Fremont, with small apartments going for more than $2,500 a month. Gabriela Bhaskar/The New York Times“Are we setting them up to fail there?” Homaira Hosseini, a lawyer and Afghan refugee who grew up in Little Kabul, asked during the lunch. “They don’t have support. Or are we setting them up to fail in places where there aren’t any jobs for them, but there is support?”That is the difficult question facing President Biden’s administration and the nation’s nonprofit resettlement organizations as they work to find places to live for the newly displaced Afghans. As of Nov. 19, more than 22,500 have been settled, including 3,500 in one week in October, and 42,500 more remain in temporary housing on eight military bases around the country, waiting for their new homes.Initial agreements between the State Department and the resettlement agencies involved sending 5,255 to California, 4,481 to Texas, 1,800 to Oklahoma, 1,679 to Washington, 1,610 to Arizona, and hundreds more to almost every state. North Dakota will get at least 49 refugees. Mississippi and Alabama will get at least 10.Where the refugees go from there is up to the resettlement agencies in each state. Sometimes, refugees will ask to live in communities where they already have family or friends. But officials said that many of the displaced Afghans who arrived this summer had no connection to the United States.Many of the Afghan refugees who arrived in the U.S. this summer had no friends or family in the country.Kenny Holston for The New York Times“These folks are coming at a time when the job market is very good,” said Jack Markell, the former Democratic governor of Delaware who is overseeing the resettlement effort. “But they’re also coming here at a time when the housing market is very tight.”.css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-1kpebx{margin:0 auto;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-1kpebx{font-size:1.25rem;line-height:1.4375rem;}}.css-1gtxqqv{margin-bottom:0;}.css-1g3vlj0{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-1g3vlj0{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-1g3vlj0 strong{font-weight:600;}.css-1g3vlj0 em{font-style:italic;}.css-1g3vlj0{margin-bottom:0;margin-top:0.25rem;}.css-19zsuqr{display:block;margin-bottom:0.9375rem;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}“Our job is to provide a safe and dignified welcome and to set people up for long-term success,” he said. “And that means doing everything we can to get them to the places where it’s affordable, where we connect them with jobs.”For Mr. Biden, failure to integrate the refugees successfully could play into the hands of conservatives who oppose immigration — even for those who helped the Americans during the war — and claim the Afghans will rob Americans of jobs and bring the threat of crime into communities. After initially welcoming the refugees, the Republican governor of North Dakota has taken a harder line, echoing concerns of his party about vetting them.Haomyyn Karimi, a former refugee who has been a baker at an Afghan market in Little Kabul for thirty years, choked up at the thought of another generation of Afghan refugees struggling to build a new life in the face of financial difficulty and discrimination.“They had lives in Afghanistan,” Mr. Karimi said through an interpreter during a brief interview at the Maiwand Market in downtown Fremont. “Their money was in banks in Afghanistan that are no longer available to them. So they’re literally starting with nothing.”Haomyyn Karimi, center, has been a baker at an Afghan market in Little Kabul for thirty years.Gabriela Bhaskar/The New York Times‘They need to find workers.’The refugees are arriving at a moment of severe economic need — labor shortages across the country mean that communities are desperate for workers. In Fargo, where the unemployment rate is 2.8 percent, many restaurants have to close early because they can’t find enough workers.“Everybody’s looking for people,” said Daniel Hannaher, the director of the Fargo resettlement office for the Lutheran Immigration and Refugee Service, which expects to receive several dozen refugees soon. “And, you know, it’s getting to the point now where everybody’s mad about the restaurants.”The same is true in Tulsa, where the unemployment rate is 3.5 percent and dropping. G.T. Bynum, the city’s Republican mayor, told Public Radio Tulsa that he’s eager for the new refugees to see that Tulsa “is a city where we help each other out, whether you’ve lived here your whole life or you just got off the plane from Afghanistan.”Financial help for the Afghan refugees flows through the resettlement agencies in the form of a one-time payment of up to $1,225 per person for food assistance, rent, furniture and a very small amount of spending money. An additional $1,050 per person is sent to resettlement agencies to provide English classes and other services.Because refugees are authorized to work in the United States, much of the help is directed toward helping them find a job, Mr. Markell said. Refugees are also eligible to receive Medicaid benefits and food stamps.Historically, refugees have quickly gotten to work in the U.S., without taking jobs from Americans.About one in five new refugees to the United States finds employment in the first year of arrival in the country, a high rate among wealthy nations, according to a paper published by a trio of researchers at University College London last year in the Journal of Economic Perspectives. Employment rates for refugees to America jump sharply in the years that follow.Sayed Mahboob, right, an elementary school teacher in Sacramento, Calif., often helps more recent Afghan transplants with paperwork as they settle in the U.S.Gabriela Bhaskar/The New York TimesAriana Sweets Inc. is a family-owned business in the Fremont area specializing in Afghan and Middle Eastern food.Gabriela Bhaskar/The New York TimesWorkers have been slow to return to jobs or industries they left in the pandemic, leaving many restaurants and retail stores desperate to hire.Gabriela Bhaskar/The New York TimesCritics of high levels of refugee acceptance, including top officials in the White House under former President Donald J. Trump, contend that refugees compete with American workers — particularly for low-wage jobs — and dramatically reduce how much those existing workers earn.The vast majority of empirical economic research finds that isn’t true. An exhaustive report published by the office of the chief economist at the State Department examined settlement patterns of past refugees to the United States, comparing the economic outcomes of areas where they did and did not settle. It found “robust causal evidence that there is no adverse long-term impact of refugees on the U.S. labor market.”If anything, economists say, the current labor market makes it even less likely that refugees would steal jobs or suppress wages for people already here. U.S. employers reported more than 10 million job openings nationwide in August, down slightly from a record 11 million in July. Workers have been slow to return to jobs or industries they left in the pandemic, leaving many restaurants and retail stores desperate to hire.Few, if any, previous waves of refugees have entered the country with such high labor demand across the country, or with the lure of worker-parched areas that could offer relatively high starting salaries for even inexperienced staff.And places like Fargo and Tulsa offer cheaper housing, too. The average rent for a one-bedroom apartment in Fargo is $730 a month, less than a third of what it is in Fremont. The average rent in Tulsa is $760.A donation center at the Matt Jimenez Community Center in Hayward, Calif.Gabriela Bhaskar/The New York Times‘Support is critical’But some have concerns about sending the Afghans to places where there are few familiar faces and prejudice is more common.Understand the Taliban Takeover in AfghanistanCard 1 of 6Who are the Taliban? More

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    Initial unemployment claims last week fell to a half-century low.

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    Initial U.S. jobless claims
    Weekly initial unemployment insurance claims, seasonally adjusted. Latest data: week ending Nov. 20.Source: U.S. Employment and Training AdministrationBy The New York TimesInitial unemployment claims tumbled last week to their lowest point since 1969, the Labor Department reported Wednesday.New filings for state benefits totaled 199,000 on a seasonally adjusted basis, a decline of 71,000 from the previous week.The drop marks a milestone in the economy’s recovery from the pandemic. Weekly claims peaked at more than six million in April 2020 as the coronavirus forced businesses and consumers alike to shut down. As recently as early January, amid a winter resurgence of the coronavirus, new state claims exceeded 900,000 in one week.Filing for unemployment benefits has come down sharply since then, but remained well above prepandemic levels until very recently.Unemployment insurance was a key source of relief after the pandemic threw more than 20 million people out of work. To buttress state payments, emergency benefits were funded through federal pandemic relief bills, although those payments ceased in September, cutting off aid to 7.5 million people.Despite a summer lull, the economy has been showing signs of life lately. Employers added 531,000 jobs in October, and most economists expect growth to pick up in the final quarter of the year, boosted by healthy consumer spending.“Today’s data reinforce the historic economic progress we are making and the importance of building on that progress in the weeks ahead,” President Biden said in a statement about the unemployment claims report.As one measure of progress, Mr. Biden pointed to the most recent tally of unemployment benefits of all sorts, from early November, which showed the number of people with continuing claims — those filing for benefits who have already filed an initial claim — at 2.4 million. The figure right before Thanksgiving last year was more than 20 million.The biggest economic worry lately hasn’t been joblessness but inflation, which has been surging amid labor shortages, supply chain disruptions and higher energy prices.In a separate report Wednesday, the Commerce Department said that household spending rose 1.3 percent in October, while personal income jumped 0.5 percent, before adjusting for inflation. It also showed that prices climbed by 5 percent in the 12 months through October.The data for unemployment claims, although certainly welcome news, may not be quite as good as it seems. On an unadjusted basis, state claims rose last week. And employment remains 4.2 million below its level in February 2020, before the pandemic.“While the labor market is recovering, we think the latest drop in claims may be overstated,” said Gregory Daco, chief U.S. economist at Oxford Economics. “We suspect the decline last week may have been exaggerated by quirky seasonal adjustment factors and think we might see a bounce-back in the weeks ahead.” More

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    $15 minimum wage for federal contractors will take effect Jan. 30.

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    Employees of federal contractors will make at least $15 per hour under a final rule that the Labor Department announced Monday, providing a likely wage increase for over 300,000 workers, according to administration estimates.The wage floor will affect contracts that are executed or extended beginning on Jan. 30, 2022. The current minimum wage for contractors is $10.95 under a rule enacted by the Obama administration in 2014 and is scheduled to rise to $11.25 on Jan. 1. Both rules require that the minimum wage increase over time to account for inflation.Paul Light, an expert on the federal work force at New York University, has estimated that five million people work for employers that have federal contracts, including security guards, food workers, janitors and call center workers, but most already make more than $15 per hour. The rule will also apply to construction contracts entered into by the federal government.Labor Secretary Martin J. Walsh said in a statement that the rule “improves the economic security of these workers and their families, many of whom are women and people of color.”President Biden announced the rule in April when he signed an executive order directing the department to issue it. Mr. Biden’s announcement came amid a series of pro-labor moves by the administration, which included reversing Trump-era rules softening worker protections and enacting legislation that allocated tens of billions of dollars to strengthen union pension funds.Administration officials said they did not expect the minimum wage increase to result in significant job losses or cost increases, contending that the higher wage would improve productivity and reduce turnover, providing employers and the government with greater value.The federal minimum wage remains $7.25 per hour, though many cities and states have laws setting their wage floors substantially higher. The House of Representatives has passed a bill to raise the federal minimum to $15 per hour by 2025, but the legislation has not advanced in the Senate. More

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    Record Number of American Workers Quit Jobs in September

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    Number of People Who Left Their Jobs Voluntarily by Month
    Note: Seasonally adjusted. Voluntary quits exclude retirements.Source: Bureau of Labor StatisticsBy The New York TimesEmployers are still struggling to fill millions of open jobs — and to hold on to the workers they already have.More than 4.4 million workers quit their jobs voluntarily in September, the Labor Department said Friday. That was up from 4.3 million in August and was the most in the two decades the government has been keeping track. Nearly a million quit their jobs in the leisure and hospitality industry alone, reflecting the steep competition for workers there as businesses recover from last year’s pandemic-induced shutdowns.There were 10.4 million job openings in the United States at the end of September. That is down a bit from the record 11.1 million posted in July, before the spread of the Delta variant of the coronavirus led to a slump in sales in some businesses. But demand for labor remains extraordinarily high by historical standards — before the pandemic, the record for job openings in a month was 7.6 million in November 2018. The Labor Department revised its estimate of job openings in August to 10.6 million.There were roughly 75 unemployed workers for every 100 job openings in September, the lowest ratio on record. Separate data released last week by the Labor Department showed that job growth rebounded in October but that the labor force barely grew.“You’re essentially seeing demand continuing to increase without an offsetting increase in talent,” said Ryan Sutton, a district director for Robert Half International, a staffing firm. “Until some new talent comes in, until we get employees who are on the sidelines back into the market, it’s very likely this is going to continue.”A hiring sign at a store in Manhattan. There were 10.4 million job openings in the United States at the end of September.Jeenah Moon for The New York TimesEconomists cite a number of reasons for the slow return. The pandemic is still disrupting child care, making it hard for some parents to work; other workers are worried about contracting the virus or spreading it to high-risk family members. Many Americans have also built up their savings during the pandemic, allowing them to be choosier about jobs..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-1kpebx{margin:0 auto;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-1kpebx{font-size:1.25rem;line-height:1.4375rem;}}.css-1gtxqqv{margin-bottom:0;}.css-1g3vlj0{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-1g3vlj0{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-1g3vlj0 strong{font-weight:600;}.css-1g3vlj0 em{font-style:italic;}.css-1g3vlj0{margin-bottom:0;margin-top:0.25rem;}.css-19zsuqr{display:block;margin-bottom:0.9375rem;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}Those factors are likely to ease as the pandemic ebbs and savings dwindle. But other shifts could prove more lasting. In a research note published Friday, economists at Goldman Sachs observed that roughly two-thirds of the people who had left the labor force during the pandemic were over 55; many of them have retired and are unlikely to go back to work.The labor crunch is giving workers the upper hand in negotiations. Wages have risen sharply in recent months, particularly in service jobs, although in other industries pay is lagging behind the pace of inflation.The recent rise in the number of workers quitting suggests that many are taking advantage of their leverage to accept better-paying jobs, or to look for them. At the same time, understaffing in many businesses may be putting stress on remaining workers, leading even more people to leave their jobs. Industries that require most employees to work in person, such as manufacturing, retail and health care — as well as leisure and hospitality — report the biggest increases in the rate of workers leaving their jobs.“We are seeing big pickups in quits in the industries that are having the hardest time hiring right now,” said Nick Bunker, director of economic research for the job site Indeed.Kaylie Sweeting worked as a bartender in Millburn, N.J., through most of the pandemic, despite concerns about interacting with unmasked customers and frustration about low wages. But when the restaurant pressured a colleague to come to work sick this summer, Ms. Sweeting quit.“The job was absolutely no longer worth it,” she said. “I was hurt that a company that I gave my time to did not seem to prioritize me or my safety.”So Ms. Sweeting, 23, and her partner, a cook, decided to take the money they had saved to buy a house and open their own vegan restaurant instead. They recently signed a lease and are beginning renovations, with plans to open early next year. They are trying to apply the lessons they have learned as employees, promising good wages, paid time off and other basic benefits that restaurant jobs have often failed to provide.“I genuinely love the industry,” Ms. Sweeting said. “I just don’t love the way it’s managed. I feel like the only way to change it is to implement the change yourself.” More

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    The Biggest Kink in America’s Supply Chain: Not Enough Truckers

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    WASHINGTON — Facing more than $50,000 in student debt, Michael Gary dropped out of college and took a truck driving job in 2012. It paid the bills, he said, and he could reduce his expenses if he lived mostly out of a truck.But over the years, the job strained his relationships. He was away from home for weeks at a time and could not prioritize his health: It took more than three years to schedule an optometry appointment, which he kept canceling because of his irregular work hours. He quit on Oct. 6.“I had no personal life outside of driving a truck,” said Mr. Gary, 58, a resident of Vancouver, Wash. “I finally had enough.”Truck drivers have been in short supply for years, but a wave of retirements combined with those simply quitting for less stressful jobs is exacerbating the supply chain crisis in the United States, leading to empty store shelves, panicked holiday shoppers and congestion at ports. Warehouses around the country are overflowing with products, and delivery times have stretched to months from days or weeks for many goods.A report released last month by the American Trucking Associations estimated that the industry is short 80,000 drivers, a record number, and one the association said could double by 2030 as more retire.Supply-chain problems stem from a number of factors, including an extraordinary surge in demand for goods and factory shutdowns abroad. But the situation has been compounded by a shortage of truckers and deteriorating conditions across the transportation sector, which have made it even harder for consumers to get the things they want when they want them.The phenomenon is rippling across the economy, weighing on growth, pushing up prices for consumers and depressing President Biden’s approval rating. But the White House has struggled with how to respond.On Tuesday, it announced a series of steps aimed at alleviating supply-chain problems, such as allowing ports to redirect other federal funds to efforts to ease backlogs. As part of the plan, the Port of Savannah could reallocate more than $8 million to convert existing inland facilities into five pop-up container yards in Georgia and North Carolina to help ships offload cargo more quickly.That followed an announcement by Mr. Biden last month that major ports and private companies would begin moving toward 24-hour operation in an effort to ease the gridlock. But early results suggest that trucking remains a major bottleneck in that effort, compounding congestion at the ports.The directors of the ports of Los Angeles and Long Beach said that, at least initially, few additional truckers were showing up to take advantage of the extended hours.Gene Seroka, the executive director of the Port of Los Angeles, said his port had told the White House in July that about 30 percent of the port’s appointments for truckers went unused every day, largely because of shortages of drivers, the chassis they use to pull the loads and warehouse workers to unload items from trucks.“Here in the port complex, with all this cargo, we need more drivers,” Mr. Seroka said.The $1 trillion infrastructure bill that the House passed last week could help mitigate the shortage. The legislation includes a three-year pilot apprenticeship program that would allow commercial truck drivers as young as 18 to drive across state lines. In most states, people under 21 can receive a commercial driver’s license, but federal regulations restrict them from driving interstate routes.But industry experts said the program was unlikely to fix the immediate problem, given that it could take months to get underway and the fact that many people simply do not want to drive trucks.Mr. Biden said last month that he would consider deploying the National Guard to alleviate the trucker shortage, although a White House official said the administration was not actively pursuing the move.Meera Joshi, the deputy administrator of the Federal Motor Carrier Safety Administration, said the agency had focused on easing the process of obtaining a commercial driver’s license after states cut back licensing operations during the coronavirus pandemic. The agency has also extended the hours that certain drivers can work. “They are the absolute backbone of a big part of our supply chain,” Pete Buttigieg, the transportation secretary, said about truckers at a White House briefing on Monday. “We need to respect and, in my view, compensate them better than we have.”The shortage has alarmed trucking companies, which say there are not enough young people to replace those aging out of the work force. The stereotypes attached with the job, the isolating lifestyle and younger generations’ focus on pursuing four-year college degrees have made it difficult to entice drivers. Trucking companies have also struggled to retain workers: Turnover rates have reached as high as 90 percent for large carriers.In response, the companies have raised their wages. The average weekly earnings for long-distance drivers have increased about 21 percent since the start of 2019, according to the Bureau of Labor Statistics. Last year, commercial truck drivers had a median wage of $47,130.On any given day this summer, dozens of container ships waited outside the ports of Los Angeles and Long Beach to unload their cargo.Stella Kalinina for The New York TimesThe Port of Los Angeles. Trucking remains a major bottleneck in the effort to reduce congestion at U.S. ports.Stella Kalinina for The New York TimesTo pay for those increases, trucking companies are raising their rates. Jon Gold, the vice president of supply chain and customs policy at the National Retail Federation, said the driver shortage has contributed to steeper costs for retailers, which are trickling down to consumers and pushing up some of the prices at stores.“We are seeing cost increases at every step of the way in the transportation supply chain,” Mr. Gold said. “From ocean to truck to rail, costs are increasing.”Derek J. Leathers, the president and chief executive of Werner Enterprises in Omaha, which employs about 9,500 drivers, said its services cost about 15 percent more than prepandemic levels as driver salaries and equipment costs have climbed.The company is trying to hire about 700 truck drivers — up from about 300 before the pandemic — after demand swelled and retirements left the company short on workers. It has increased driver compensation by about 20 percent since the start of 2020 and expanded the number of driving academies it operates.“I’ve been in the business for over 30 years,” Mr. Leathers said. “I definitely think this is the tightest driver market I’ve seen in my career.”Understand the Supply Chain CrisisCard 1 of 5Covid’s impact on the supply chain continues. More

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    Starbucks Workers at 3 More Buffalo-Area Stores File for Union Elections

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    One day before ballots were scheduled to go out to workers at three Buffalo-area Starbucks in a vote on unionization, workers at three other stores in the area filed petitions with federal regulators on Tuesday requesting elections as well.The coming vote is significant because none of the nearly 9,000 corporate-owned Starbucks stores in the United States are unionized.On Monday, Starbucks filed a motion to stay the mailing of ballots while it appeals a ruling by a regional official of the National Labor Relations Board setting up separate votes at the three locations where workers initially filed for elections. The company wants all of the roughly 20 Buffalo-area stores to vote in a single election, an approach that typically favors employers.The first three stores filed for union elections in late August, and Starbucks dispatched managers and more senior company officials to the area from out of state in the weeks that followed in what it said was an effort to fix operational issues.The union has complained that the out-of-town officials are unlawfully intimidating and surveilling workers and filed an unfair labor practice charge making this accusation last week. The union also contends that Starbucks transferred in or hired a number of additional employees at two of the three stores to dilute union support.The so-called packing of a workplace before a union election is unlawful if bringing in new workers serves no legitimate business purpose and if the employer has reason to believe that the new workers will oppose a union. Starbucks has said the additional workers are needed to deal with staffing shortages.The Starbucks workers who support unionizing are seeking to join Workers United, an affiliate of the Service Employees International Union. The union says there are 31 to 41 eligible employees at each of the three locations filing the new petitions. It is seeking elections at each of them on Nov. 30.Starbucks has maintained that individual stores should not hold separate elections because its employees can work at multiple locations and because it largely manages stores in a single area as a group rather than at a store level.“We believe all of our partners in this Buffalo market deserve the right to vote,” Reggie Borges, a company spokesman, said Tuesday. “Today’s announcement that partners in three additional Buffalo stores are filing to vote underscores our position that partners throughout the market should have a voice in this important decision.” More

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    Retailers Scramble to Attract Workers Ahead of the Holidays

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    Signing bonuses, higher wages, even college tuition. Companies are using perks to entice new employees in an industry that has been battered by the pandemic.Macy’s is offering referral bonuses of up to $500 for each friend or family member that employees recruit to join the company. Walmart is paying as much as $17 an hour to start and has begun offering free college tuition to its workers. And some Amazon warehouse jobs now command signing bonuses of up to $3,000.Retailers, expecting the holiday shopping season to be bustling once again this year after being upended by the coronavirus in 2020, are scrambling to find enough workers to staff their stores and distribution centers in a tight labor market. It is not proving easy to entice applicants to an industry that has been battered, more than most, by the pandemic’s many challenges, from fights over mask wearing to high rates of infection among employees. Willing retail workers are likely to earn larger paychecks and work fewer hours, while consumers may be greeted by less inventory and understaffed stores.“Folks looking to work in retail have typically had very little choice — it’s largely been driven by geography and availability of hours,” said Mark A. Cohen, the director of retail studies at Columbia University’s business school. “Now they can pick and choose who’s got the highest, best benefits, bonuses and hourly rates. And as we’ve seen, the escalation has been striking.”Or as Jeff Gennette, the chief executive of Macy’s, which plans to hire 76,000 full- and part-time employees this season, put it in a recent interview: “Everyone’s experiencing this — there’s a war for talent at the front lines. My sense is we all have to raise our game.”While some of the most generous perks, like tuition reimbursement, are being offered mainly to long-term workers, even seasonal workers will see higher pay than usual. It’s especially critical for retailers to hire temporary help this year because existing employees are already strained from nearly two years of pandemic conditions. The National Retail Federation, an industry group, is anticipating record holiday sales and has forecast that retailers will hire 500,000 to 665,000 seasonal workers, significantly more than the 486,000 in 2020.It’s especially critical for retailers to hire temporary help this year to assist existing employees already strained from nearly two years of pandemic conditions.Jeenah Moon for The New York Times“The biggest risk to retailers and distributors is that they are working their current work force too much,” said Scott Mushkin, who founded the financial consultant R5 Capital, based in New Canaan, Conn. “Overtime can only go so far. The work force is tired out.”Mr. Mushkin experienced firsthand just how eager retailers are for workers during a visit last month to a Home Depot in Naperville, Ill.“I was looking at a sign listing open positions at the store when I was basically accosted by a manager asking if I was interested in applying,” Mr. Mushkin said.Mr. Mushkin said he was struck not only by the manager’s desperation but also by the number of positions available. “Basically every job in that store is open,” he said. “So who is doing those jobs now? Who is picking up the slack?”Those pressures may explain why large retailers like Walmart are looking to hire 150,000 additional workers to supplement its current staff this season. For several years leading up to the pandemic, Walmart offered existing workers extra hours at the holidays but did not start a large hiring blitz. (Existing employees can still sign up for additional hours.) It recently raised its minimum wage to $12 an hour, and in some stores it is offering new workers $17 an hour.A recruiter for Amazon at a job fair in Virginia last month. It is looking for an additional 150,000 people this holiday season.Andrew Caballero-Reynolds/Agence France-Presse — Getty ImagesAmazon is also looking for an additional 150,000 people this holiday season, which follows a push to expand its permanent work force by 125,000. With giant retailers gobbling up many of the job candidates, enticing new employees is that much harder for others.Many retailers, like Saks Off 5th, reiterated commitments to remain closed on Thanksgiving this year, a welcome shift for workers after a yearslong trend of shopping invading the holiday. Demanding that employees work in stores that day would probably be a particularly tough sell this year.Nordstrom, which is aiming to hire 28,600 seasonal and regular employees, said it had increased bonus and incentive pay to as much as $650 for hourly and overnight store workers, from as much as $400 last year.Saks Off 5th said in October that it was raising its minimum base wage for hourly store workers to $15 per hour — more than double the federal minimum wage — and that it would not offer extended holiday shopping hours this year so that staff could have more flexibility.Best Buy is allowing job applicants to submit videos rather than coming in physically for a first round of interviews, saying in a recent statement that the videos “can be recorded and reviewed without the need to go back and forth on scheduling.”The scramble by retailers comes as the American economy is gaining strength, adding 531,000 jobs in October, a sharp rebound from the previous month. But even as unemployment dropped to 4.6 percent from 4.8 percent, the labor participation rate — which measures the share of the working-age population employed or looking for a job — was flat last month, at 61.6 percent. That signals that the pool of available workers remains tight.“We’re coming out of a crisis we have no experience in dealing with, in which millions of people were furloughed or laid off or removed from the work force, and to think they’ll all show up on certain date to come back to work is kind of silly,” Mr. Cohen said. “Some people are still fearful about coming back to work, especially in a job in which they would be exposed to large numbers of the public.”While fear of the Delta variant may be keeping some workers away, the retail industry had been loath to impose vaccine mandates for fear that store workers might leave and that it might become even harder to find seasonal employees. A new vaccinate-or-test requirement for companies with 100 or more employees announced by the Biden administration on Thursday essentially forced their hands, though it is not scheduled to take effect until Jan. 4 and was temporarily blocked on Saturday by a federal appeals court in Louisiana. (The mandate does instruct employers to require unvaccinated workers to wear masks by Dec. 5.)The National Retail Federation was critical of the mandate, saying it imposes “burdensome new requirements on retailers during the crucial holiday shopping season.”L.L. Bean’s chief executive said that it has been “incredibly challenging” to hire hourly employees, especially for its 54 stores.Karsten Moran for The New York TimesStephen Smith, the chief executive of L.L. Bean, the outdoor retailer based in Maine, said it has been “incredibly challenging” to hire hourly employees, especially for its more than 50 stores. The chain is not offering bonuses, but it has given priority to new forms of flexibility to attract workers. For example, jobs at its domestic call center are now fully remote.In stores, Mr. Smith said, “we have changed our shift structure so you can do two- or four-hour shifts” in an attempt to “make it a lot easier if you’re juggling family responsibilities.”The company has also sought to emphasize its unique benefits, including several paid days off for employees to pursue outdoor experiences.The challenge of finding workers has put a spotlight on how difficult many retail jobs are and on the short shrift given to many store workers during the worst of the pandemic. They were regularly exposed to Covid-19 and involved in customer conflicts around wearing masks, and they were inconsistently offered hazard pay or other compensation for their efforts. Many retail workers said that they were not properly informed when they were exposed to the virus in stores.Anthony Stropoli, a personal shopper at Bergdorf Goodman, holds one of the lucrative, client-facing jobs that have been fading in retail in recent years and he noted that luxury retail was a different ballgame. He previously worked at Barneys New York, which filed for bankruptcy in 2019.“A lot of people do not want to work in retail right now — I really, really see it,” Mr. Stropoli said. “People are not feeling appreciated or fairly compensated, and I think this whole Covid thing has made them really rethink that. They want to feel valued.”It all means that workers have more leverage this season than they have in the past. Joel Bines, global co-leader of the retail practice at the consulting firm AlixPartners, said if retailers want to find enough workers this season, they need to pay them more and fundamentally improve working conditions.“For retailers, who have treated their workers as dispensable cogs in order to increase the bottom line, to say they are shocked that they can’t find people to work for them is hard to believe,” Mr. Bines said.“The thing that the industry needs to realize is that workers have agency now,” he added. “They have agency in a way they never have before.”Contact Sapna Maheshwari at sapna@nytimes.com and Michael Corkery at michael.corkery@nytimes.com. More