Hello everyone and welcome to this episode of Ignition Time.
Folks, the American economy is changing.
Unemployment benefits have ended,
but employers are baffled because many, many job vacancies still exist.
Let's dig deeper into this and I'll give you the full story.
Welcome to our channel, everyone. My name is Dr. Nitin Chhoda
and this right here is a little bit of information about me.
You'll learn more about who I am,
what my journey has been like and why you should listen to me.
Now it's been over two weeks since the federal
unemployment benefits ended, and my personal belief is that they should
have been extended specifically for those who need help the most.
But right now, Congress is in a state of gridlock.
In fact, the Democrats themselves cannot
come up with a clear plan to pass the $3.5 trillion reconciliation bill.
And there have been Democratic lawmakers
who want to try and pass an extension of unemployment benefits within that bill.
But the problem now is that there are a lot of vacancies,
and employers are completely baffled as to why there are so many vacancies.
In fact, here's a quote from Richard Wahlquist,
who's a President of American Staffing Association,
which by the way, is America's largest recruitment industry group.
Richard says this, people who have been
on the sidelines have, by and large stayed on the sidelines.
Nothing has changed in regard
to the benefits that have fallen off, and the need for people continues to grow.
In fact, Richard himself is struggling.
He's looking for ten temporary workers to help at the organization's conference
in Denver at the end of the month, and they're paying $25 an hour.
So far, he's got only two people.
What's happening is across the country.
A lot of staffing, firms and businesses
are trying to get more people back on payroll.
In fact, Goldman Sachs said their economists forecast
at the expiration of the federal program the unemployment benefits,
which by the way, affected half of the US States after
the other half had ended unemployment benefits early would add
Goldman Sachs predicted that this would
add 1.3 million people to payroll by the end of the month.
However, it is not starting to happen.
So what's happening is that the great labor shortage is existing.
In fact, it's growing and there are record
10.9 million job openings in the month of July.
Here's a quote from Annelizabeth Konkel who's an economists at Indeed.
And she says this, we're only going to see
the impact of the federal UI benefits ending a couple of months from now.
I don't think we're going to see a big spike one way or another really.
Really, we thought things should be better by Labor Day, and they're not.
So what is happening, folks?
One of the reasons could be pent up savings
according to Daniel Zhao, who's
a senior economist at GlassDoor, stimulus checks and employment benefits
and all the social safety net programs have driven the savings rate to a record
34% in the last year, and they remain elevated.
Here's a chart on your screen that shows you how much money Americans have,
months of stimulus checks have actually
raised the average savings rate for the average Americans.
So in fact, the average savings rate in 2020 was as high as a whopping 35%.
Think about that, folks.
It's never been that way since we started keeping records.
And now that rate is at 9.6%, which by the way,
if you look at this chart, you see that the three month moving
average is significantly higher than it was back in 20, 17, 20, 18 in 2019.
What does this mean?
This means that people have more money saved up.
In fact, a lot of employers thought
that there would be a significant increase in the number of online applications.
But guess what? It hasn't happened.
Here's a quote from Johnny Billy,
who's a chief workforce analyst at Atlanta based Employee Bridge,
and she thought that things would come back on track pretty quickly.
Here's a quote from Billy.
I've been asking all of our locations across the US.
Are you busier?
How does it feel since the benefits have ended?
And by the way, Billy's firm connects employers with companies across the US
focusing on manufacturing, logistics and call centers.
And here's another important quote.
I pulled the data last night and I thought it would be better.
But it's not folks.
People are not getting back into the workforce.
In fact, in the restaurant industry, job applications have actually declined
three to 4% each week for the past nine weeks, including
the period following the expiration of the boosted benefits,
according to Restaurant 365, which is a restaurant management software company.
According to Tony Smith,
who's a CEO and found of the company, that's contrary to many predictions,
that aid was a primary factor keeping restaurant workers out of the workforce.
Folks, this goes to show that all the Republican States ending
the unemployment benefits early were absolutely wrong.
Just because the unemployment benefits
have ended does not mean people are going to rush back to.
In fact, there have been other reasons,
including safety, including child care, including someone reevaluating their
options and saying, hey, I don't want to go back to that same job.
I want to look for a different job.
Maybe I want to switch careers.
Maybe I want to start my own business.
And why not, folks, I want each and every
one of our viewers and subscribers to live the American Dream.
One thing is, for sure, the extra unemployment benefits may have
been keeping some individuals at home, but for the most part, they have not.
I repeat, not resulted in individuals just trying to take advantage of the system.
Like a lot of our lawmakers thought.
And the external employment benefits did
not act as a disincentive for people to return to work.
The lawmakers were absolutely wrong about that.
In fact, the reason for all these missing
workers, like I mentioned earlier, can be childcare barriers,
not being able to find child care, which, by the way, is a serious problem because
daycares are actually losing important staff members.
My two year old daughter goes to a daycare and they've been losing employees.
They lost their manager, they lost a number of key employees.
A lot of daycares are actually struggling right now.
In addition to childcare barriers,
there's a mismatch between skills and individual may have a certain set
of skills, but they don't want to work in that job anymore.
Healthcare concerns are prominent, especially for individuals in the travel,
leisure, entertainment and hospitality industry.
And also this is a big one,
a mass reallocation of work as people reconsider their careers.
In fact, here's another quote from Wal Quest.
As people look at their bank accounts and realize we'll come into the holiday
season, we hope people have more incentive to come back.
Let me ask our viewers and subscribers a question.
Do any of these factors apply to you
childcare barriers that are preventing you from getting back to work? A mismatch
in your skills, health concerns, actual concerns about
your safety, particularly if you're in Travel leisure,
enter attainment and hospitality. And most importantly, are you reconsidering your
job? Are you thinking of resigning from your main job and essentially
switching careers? Essentially a mass reallocation of work?
Because many people are indeed reconsidering their careers?
Let me know what you think.
Thank you so much for watching. My name is Dr.
Nathan Short.
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