I recently just got back from a trip to Atlanta. Was there a couple days, visited a couple of restaurants from more high end to low end in the city. Every place we went was super crowded with people eating, but every place also said to be patient with them as they were short on workers. Some places even turned us away because they said they didnt have enough servers.
I've tried to think about it on my own, and have come up with the following ideas/answer:
(1) I know there are way more ways to make money currently than 10 years ago or pre-Iphone days. Are there less workers in physical places because you can basically launch a business from your couch/phone?
(2) We ended up at a chain restaurant at one point (waffle house), they had old corporate pictures up, previous workers looked a lot more college aged. Did the US use to have/encourage more college workers where as now college students work less?
(3) Is the "we'e short on labor" explanation really just a way to provide less service, or almost as an excuse?
Would enjoy if someone could please give an explanation to me. Thanks in advance.
Mix of:
- Retirees. Majority of boomers as of 2022 entered the 65+ cohort and aren't returning
- Job shifting / reskilling. Labor shortage isn't everywhere but it's in a lot of places. I.e. some nurses re-skilled to info based jobs, so less of an issue there relatively speaking (esp as we can hire overseas / remote) but nursing then has a bigger shortage. Likewise relates to lack of access to childcare as those workers retired / moved to other fields, which imposes a burden on 2 parent working HHs where one parent may not be able to get back to work
- Stimulus checks + increased savings. Resulted in less urgency for many missing workers to return to work. This will mitigate somewhat given high inflation
- One thing I haven't substantiated but a theory: as entrepreneurship has become much more frictionless (slack, zoom, shopify, etc) & creator economy expands, more people doing entrepreneurial things. The attractive girl waitressing is now launching her own bracelet collection via 500k IG followers
- Lower immigration. Hasn't recovered to pre-Covid levels, I think peak immigration was mid-2010s anyway. This will be hard to bring back, Biden admin hasn't done much here and a future Trump admin won't either
Might be missing 1 more factor here but above should explain >80% of it
This is the right answer, or at least a big part of it. Didn't GS put out a Great Resignation report about 2 months ago that said the same thing?
Silver tsunami finally incoming for all my senior housing owners
The entrepreneurship point may be difficult to substantiate with hard data, but anyone who's generally plugged into the world knows that's been one of the causes. Agree with the other causes on your list too. I think the entrepreneurship one will pull back a lot. Has already started to.
Agreed, entrepreneurship is a good point; however, I have a tough time trying to figure it out in my head. Basically, if everyone is doing this (say selling bracelets they make), its probably a relative pot of money that gets divided among more and more people, so each take is smaller.
Also, I don't want to say its a house of cards, because even corporate jobs aren't safe essentially, but as the bull market kept going, more and more people felt safe to break out on their own, and when it all goes bad, it could collapse quickly.
Here’s a decent dataset looking at new business formation: https://www.census.gov/econ/bfs/pdf/bfs_current.pdf There is substantial growth post-pandemic.
So I understand the stimulus checks/saving point, but for these laborers, say a construction worker that is being paid hourly - do a lot of them really not work for a few months and live off savings/stimulus until it goes to $0 then go find a job? That seems pretty crazy to me.
There actually are people who live like this, basically boom and bust in the sense they work, save up a little, then dont work until the money runs out.
What I don't get is, if this is true, stimulus and bonus unemployment was "that" much, eventually people would have to return to work.
Construction workers for sure because they can get OT and fatten up on a big project then scale back for a while.
But the biggest group that moves in and out of the labor market are non-breadwinners, often women, who work insofar as they need to supplement another income. Waitressing / hostessing is a good example but there are a lot more jobs like this than those two.
Yes. Work overtime and/or weekends until they save up a few tens of thousands, then head to SE Asia for as long as possible
boomers weren't serving tables. and table servers didn't just become software engineers in a year. stimulus checks were $2000. it can last you for 2 weeks, not 2 years.
nice on future Trump admin haha.
What are they doing instead? Surely not all of them are leetcoding hard trying to get a job at some tech company.
tbh, would be pretty fun to go on a road trip all over the US (and the world maybe) to visit towns where those people "job shifting" and "reskilling" live & just hang out at bars meeting those people. People tell strangers they met at a bar about surprising amount of facts (and lies).
I've noticed that people tell you the truth when talking about their career aspirations but lies when talking about personal life and what not.
COVID sped up the baby boomers retiring it seems. We were going to face that pain sooner or later.
Why in the world did my post get removed? Wtf? There was literally nothing than even the most alt left person could criticize in my post
WallStreetOasis.com what's going on? This kind of oppression is completely unwarranted, my post would have been completely fine on even Reddit
they r sell outs
lol if they delete this just confirms it and the continued spread of leftist fascism
WallStreetOasis.com You should ban these uselessly tribal posts too!
Nobody: [says anything at all]
This guy: "The 'Alt-Left' is attacking me!" (lmao)
Please remove this trash.
original statement:
"I'm unhappy my post got removed as it was a non-offensive and reasonable statement of thought"
my response:
"Agreed, I hope WSO does not bend the knee to the blatant, widespread fascism stemming from left-wing ideology that decimates free speech and individual thinking" As an aside, to the mentally incapacitated (ie. "Fugue") that does not mean I keep a conservative flag and a dart board of MLK in my apartment.
"Fugue"s GENIUS comment to my response:
"Haha, I didn't fucking read anything but I saw someone complain about the left and not being able to express an opinion normally - what trash!"
People like u r y the world is trending down, u MF's have no reasonability and sincerely think ur thinking straight
this comment gets deleted? good luck to everyone lmao free speech is literally non-existent on WSO (screenshotted to show how bad cancellation has gotten, in the scenario it gets deleted)
2 million less working age immigrants during COVID. 1 million white collar, 1 million blue collar.
okay, good chart thanks.
So would it be more we are not letting in enough immigrants to the US, or is it more of a declining birth rate among immigrants from ~20 years ago that is showing up now?
birth among immigrants doesn't count as immigration cause a US citizenship is granted at birth on US territory, so the former.
I think this is very industry-specific. When you look at IBD or SWE, there is no shortage of candidates begging for opportunities.
However, there has been a material shift in job opportunities for the lower-middle class. Have you ever worked at a restaurant? Being on your feet for 8-12 hours a day, having to be polite and friendly the entire time, praying you can pay your rent solely based on tips, which sometimes dont come no matter how hard you try? I couldnt think of a worse job (aside from say a coal miner or other jobs with high health risks), and fortunately many people can pivot to other options. Uber driver / food delivery / working in one of the millions of jobs through Amazon are likely all seen as more appealing.
The issue is restaurants operate on slim margins, so they dont really have the ability to pay their workers more, unless they are a non-franchised chain or highly successful independent restaurant. Therefore, due to little to no benefits and horrendous hourly rates, workers are seeking alternative forms of employment. With the massive economic growth period in '21, essentially everyone who wasnt a convicted felon had some choice in where they worked.
Good points. I'm not arguing that working at a restaurant is a good job.
So then, really its just workers are taking other jobs/more jobs are available?
I guess my though is, from an economic perspective, its all about market supply/demand. You made a fair point about margins, but then wouldn't it be a double hit of (1) if everyone started to drive uber, wouldn't the cost of ubers be going down? (or, wouldn't the people who drive taxes, or aspire to drive taxis have to find work elsewhere) and (2) wouldn't that mean that restaurants would have to raise prices to pay workers more, meaning some restaurants would have to shut down?
I am by no means qualified to answer the follow up questions, but in terms of my perspective:
1. Demand for uber drivers dipped drastically in most of America's largest cities during the pandemic, due to funds being allocated to those without employment and fear of catching the virus through a risky trade like taxi services. During this period of time, there was a tremendous shortage of drivers, causing a spike in demand, and thus, uber prices. As we came out the other side of the pandemic, more folks returned to driving for uber. When there are too many drivers, the drivers themselves do make less, but corporate margins remain the same. Uber costs dont typically go down unless Uber adjusts their consumer pricing model, which only occurs when they are struggling. They may or may not have done this. Uber capitalizes on recurring users, and oftentimes raises the rates of their most loyal customers. There are articles about this, but I dont have any links off hand.
2. Virtually every restaurant I have gone to for the past five years has been raising its prices, citing inflation, raw materials increases, or a number of other key factors. I am talking from the Michelin star restaurants to the $10 sandwich shops I frequent most often. Isaiah_53_5 💎🙌💎🙌💎 echoed the same below. Restaurants broadly speaking have been raising their wages due to high turnover volume. Some McDonalds are offering $18 per hour wages to entice folks to work there. So yes, restaurants are struggling because they are being forced to pay their workers more, but still, turnover is at an all-time high. When the recession we are currently in elevates from mild to moderate, I suspect we will see a material number of restaurants shut down, despite witnessing something like ~10-20% of all small business-sized restaurants closing in '20 / '21. I found it interesting that a ton of restaurants shut down during the pandemic, but all of the major publicly traded companies received sufficient PPP funds to stay open. Seemed as though the allocation of funds toward smaller restaurants / groups was not sufficient. A friend's brother is the sole owner of a restaurant group in a prominent city. Covid cost him millions despite the fact that on a good year, his restaurants only netted ~500-1,500k.
Restaurants are getting squeezed right now with high food prices, high rent prices, and they try to pass this on to the customer with higher menu prices causing decreases in customer demand. Some a-hole customers at restaurants think prices are too high and tip like c/rap in addition to some restaurants not paying their servers that well. If you work all day and make less than minimum wage at a restaurant and people are spiking you with 0 tips, yeah time to do some other type of work.
I get that. good points as well.
I saw an article on the WSJ (I believe) that detailed that restaurants are now charging "inflation fees" for the kitchen staff. Basically as a way to help with pricing but not directly increase the price on the menu.
I know that most restaurants only have about 14 days cash on hand to continue their business. If there is less service, would not that mean that less people will go, and over time some restaurants should shut down?
Yeah the restaurants where I live (in Charleston SC) charge inflation fees. They put a sticker on the menu of the added fee instead of raising menu prices individually.
I think this “shortage” is nature running its course. Forcing change since the people who have the power to even the playing field, don’t. The worker has begun to acknowledge that these service-oriented jobs at the lower level do not pay a living wage and are dead-end. No one wants to do these jobs anymore because one can’t live off of those wages while everything is so expensive. Who can blame them?
That said, I think the individuals who had occupied these positions previously, decided to move back in with family and perhaps focus on gig type jobs and/or remote jobs. I could be wrong, but I had asked your same question before.
I get it doesn't pay a living wage, which I assume it somewhat did in the past. I also understand that maybe people moved back in with family so they don't need the job actually.
I'm thinking more these jobs use to be worked by college aged students or teenagers, so they just wanted money in their pocket vs a living wage. I could be incorrect though.
Strong points you mentioned about the demographics and their motives. Truth is that it could be anything from the revenue opportunities that the internet provides as well as parents just supporting their kids even at an older age. I’d love for it to come to light at some point.
A lot of restaurant and hospitality labor shifted to other industries permanently during COVID.
You can make ~$18 - $20 in a medium cost of living city doing warehouse work that isn't overly intense physically. Usually with benefits.
We pay ~$16.50 an hour on avg in LCOL with benefits for example. The work is definitely easier than being a waiter. A basic line lead is at ~$20/hr, etc
Do you think this boosts the ghost-kitchen / cloud kitchen model? Could be a tailwind for food delivery honestly
No idea but I have some friends with ghost kitchens, some at decent scale and margin is definitely juicier than normal restaurants. I would love to invest in one!
you can make $16.50 in tips for carrying two plates and a bottle of wine for 2 minutes. I would rather do that than run around warehouse for an hour.
In the warehouse there's strong upwards mobility. One guy that joined us 6 months ago is now at ~$22 an hour. He will probably be offered a role for $70k by EOY.
For the more expensive restaurants around me in my LCOL/MCOL city, the servers make a good living wage, but I have noticed the prices are high AF. I feel like I'm in NYC again. I still tip well. I always tip well................. good for them right...
a lot of minimal wage jobs, like servers, are done by immigrants. a lot of immigrants left the country during covid lockdowns when they were cut and couldn't have source of income. also, there may have been some changes to visas because a lot of international kids I know from school left back to their countries during covid times and haven't returned. my office also changed. we usually had a huge chunk of newcomers being international. now there are only a few international newcomers.
Almost all these comments aren’t right. It’s kinda bizarre. It’s also a rather simple answer—an overstimulated economy. Go back to Econ 101 guys!
Simple answer: The servers have found better jobs. It’s textbook inflation/ overheated economic machine. Take some private equity companies as an example:
My main push-back here is that what ironman32 is referencing to is very much a phenomenon hitting certain city cores and tourism-heavy areas such as Vegas, Miami, Orlando, etc, while you are approaching the situation such that shortages are uniformly distributed throughout the country.
For the past few decades population growth has been centered around the cities, while rural areas remained flat or even diminished. There has always been the goods/workers imbalance that you mention, but in the past that was an issue confined to rural areas more because people found the cities exciting and wanted to live there. Rural people may have to drive say 30 minutes to purchase the good they wanted or eat at a franchise of the restaurant they wanted. Meanwhile, city districts kept getting built out and it became easier and easier to find goods and services within a few minutes drive or even by walk even in Tier 2/3 cities. However, rent increases (which have been slowly rising in the past decade) have reached a point where I believe we are going to see the trend above reverse. City district restaurants and stores are going to shut down, due to workers being unable to afford the area and leaving, and urbanites may have to drive towards the outskirts of the city to find things. The only way this issue is solved (and has been solved in the past) is through rent-controlled housing or income subsidized housing in the downtown areas. However, such housing doesn't exist in every city and the placement of said housing can vary.
It’s not that you are wrong, that is certainly a broader trend, but in a downturn, places wouldn’t have a shortage of workers like they do now. Restaurants everywhere cant find enough staff it’s not isolated to cities. People would commute to get the service job or the restaurant would go out of business if your city migration point was really the issue. The problem he described is an issue in my grandparents retirement community, my parents burb, and the city I live in. Are certainly places more affected than others? Yeah, but the chief reason restaurants can’t find workers isn’t a city migration due to a lack of affordable housing, it’s that there are too many jobs and too few people. In a downturn, you will have college grads fighting for service jobs.
Not related, but fuck yeah Waffle House
haha I thought the same thing. Freaking Waffle House. I used to ride my bike around town like 40-50mi rides and then hit up Waffle House to get like 10 eggs and refuel. I was at this Waffle House in bumfuc* SC starving my a$$ off. I just ordered an insane amount of food which sounded like a 4-6 person order. I put my bike in the walkthrough room at the front. It was 3:30am, I was night riding and there was no one there except me.
In the middle of me waiting for my food the person who wasn't cooking my food just told me all of a sudden to put my bike down the stairs outside of the room. He wasn't doing anything and he was some young thug punk. I was like "I am not taking my bike outside, it is a $3,500 bike, I don't have a lock and don't want someone to steal it." He was like "move it now" and really got on my nerves. I said "there is no one here, I just ordered my food and this lady is cooking 72 eggs for me." He said "move it now or I'm kicking you out." I said dude - "I just ordered 125 eggs and I'm not paying jack if I don't get my food." He said "move it" again. I was fu*cking irate. This was crossing the line fight talk.
So I thought about it and my brain said yes fight this guy if he strikes first. So that was the deal in my mind. I harshly replied "make me" right after he said "move it" for the last time. He looked at me straight in the eyes and then just turned around and walked away and hid in the corner and didn't say sh** the rest of the time and I even gave the lady a good tip for making me 557 eggs. Man, I ate all those 998 eggs like a king. Let me tell you, that ride home was a victory ride. hahah what a loser/poser.
I've only been in 2 real street fights and they were just scuffles really, nothing fancy. I usually diffuse the situation, but sometimes you gotta make a mental agreement in your mind for fight or flight. Countless times when I've stepped to the plate and asked the person to punch me for legal reasons, they back down. I have trained with a lot of MMA fighters and some are triggerhappy and say they would fight someone if provoked, but I have seen that only lead to lawsuits, which is what I want to avoid. Also, street fights technically have no rules and the other guy could always have a knife and knife you, which would suck.
This is a great story. I feel like this is par for the course for Waffle House. I liked how the number of eggs were ever increasing.
Let's do an extremely simplified analysis from the point of a service worker
$15/hr @ 40 hrs/week @ 50 weeks/year = $30,000 /yr
Net (after taxes) = $24,600 / yr (used online estimators for this 1) = $2,050 / month
Monthly fixed expenses:
Car insurance: $75 / month 2
Car Payment: $320 / month 3
Food Costs: $100 / month 4
Health Insurance: ~300 / month 5 (many times those 40 hours comprise of 2 part -time jobs that do not offer benefits)
[Employer sponsored health insurance coverage is highly negatively correlated with income [6]]
Gas, Clothes, misc. $100/ month
This gives a net monthly income of $1155.
Now, we have to examine rent. What would be considered a reasonable rent payment? Using the classic 40X rule, our theoretical individual would only be approved for $750/month. Let's say a landlord decides to approve for $850/month.
Clearly, such a person needs roomates, so I went to Zillow and did a search for 2/2 @ $1,700. 7
Based off a number that I intentionally inflated I was able to find a grand total of 50 units in the entirety of Atlanta. Many of these units are close to the edge of the city limits, where the initiative to work in the city core as opposed to the outskirts would be weak.
Now based on the $750 figure I found a grand total of 17 units in the entirety of Atlanta, most again in the outskirts of the city. I did not check for safety of neighborhood, apartment quality, bug infestations, poor management, etc. I am sure that these units will be suffering in many of these.
For the young service worker, it makes 0 sense to work in the city core anymore. Rents in secondary cities such as Atlanta have been steadily on the rise in the past decade and the final Covid jump has been enough to price out these service workers. Many people want and would choose to work in the city core so long as it is affordable. If it financially makes no sense, those same workers move to the outskirts of the city or outside of the city entirely while making roughly similar wages. Yes, living in a suburb or a smaller town isn't as exciting, but there's not much of a choice for these people. Hence, this is a big reason why the major cities are seeing a shortage of service workers. The "free markets" have decided to keep building luxury apartments and raising rents without thinking about the working class and now we have a situation where the working class has to live far enough from the core that it makes no sense to work in the core anymore.
Your point 3) is valid and ties in to everything I've wrote above. When companies say "we're short on labor", they mean that they are short to find labor on their terms. 20-29hr workweeks (so no benefits) @ <$15/hr with increased work demands on said workers, all while rent prices and the general COL rise out of the affordability range for said workers.
Sources:
1 https://www.talent.com/tax-calculator/Georgia-30000#:~:text=If%20you%20….
2 https://www.bankrate.com/insurance/car/average-cost-of-car-insurance-in…
3 https://www.calculator.net/auto-loan-calculator.html?cloanamount=25000&…
4 https://mint.intuit.com/blog/food-budgets/monthly-grocery-budget-calcul….
5 https://www.healthcare.gov/see-plans/#/plan/results
[6] https://www.healthsystemtracker.org/brief/long-term-trends-in-employer-…
7 https://www.zillow.com/atlanta-ga/rentals/?searchQueryState=%7B%22pagination%22%3A%7B%7D%2C%22usersSearchTerm%22%3A%22Atlanta%2C%20GA%22%2C%22mapBounds%22%3A%7B%22west%22%3A-84.63143668383789%2C%22east%22%3A-84.22974906176758%2C%22south%22%3A33.654498580504935%2C%22north%22%3A33.892508652910216%7D%2C%22regionSelection%22%3A%5B%7B%22regionId%22%3A37211%2C%22regionType%22%3A6%7D%5D%2C%22isMapVisible%22%3Atrue%2C%22filterState%22%3A%7B%22fsba%22%3A%7B%22value%22%3Afalse%7D%2C%22fsbo%22%3A%7B%22value%22%3Afalse%7D%2C%22nc%22%3A%7B%22value%22%3Afalse%7D%2C%22fore%22%3A%7B%22value%22%3Afalse%7D%2C%22cmsn%22%3A%7B%22value%22%3Afalse%7D%2C%22auc%22%3A%7B%22value%22%3Afalse%7D%2C%22fr%22%3A%7B%22value%22%3Atrue%7D%2C%22ah%22%3A%7B%22value%22%3Atrue%7D%2C%22beds%22%3A%7B%22min%22%3A2%7D%2C%22mp%22%3A%7B%22max%22%3A1500%7D%2C%22price%22%3A%7B%22max%22%3A289797%7D%2C%22baths%22%3A%7B%22min%22%3A2%7D%7D%2C%22isListVisible%22%3Atrue%2C%22mapZoom%22%3A12%7D
The most simple answer is that a plurality, if not majority, of US restaurants would not be in business if they actually paid their people a living wage. To rephrase, the only reason why many US restaurants even still exist is because they suppress wages. This POV is coming from an unabashed capitalist. Many owners complain that margins are slim and they can’t afford to pay more. Well honestly, the beauty of capitalism is it eliminates the poor performers from the market. Many owners have just gotten use to paying less and taking more for themselves just out of greed. So now when they are expected to pay their workers more, they cry and complain about potentially going out of business.
I have no sympathy for the owners because I have been to restaurants in numerous locations in Europe and they are not having the same issue as in the US. Their workers are paid fairly, menu prices are not excessive, and you are not expected to leave a tip. The scale is more balanced. Yes, European restaurant owners probably make less but it’s still profitable and they are still in business.
What's so different about Europe vs the U.S.? I mean this as a legitimate question. Think about the average McDonald's owner starting up fresh. I would imagine a brand new McDonald's operation would be at least $2.5M with real estate and an actual finished building. We'll say the owner gets an approved 30 year term loan at $2M and 5.5% interest. Say margins are 10% on $3.5M in revenues. That's $350k before the new owner pays the loan, which is $136K a year. So that's $215,000 left over. Is it worth the risk? What is a "fair amount" to make while paying the employees a living wage and how does an owner navigate profitability? What's the balance of risk reward and why is it different in Europe?
I can explain it in a single sentence: Wage stagnation and rising cost of living.
To elaborate:
There is no "labor shortage", it's just another economic narrative from the media. There are plenty of people, but they aren't going to put up with bad employers for wages they can't even survive on. The wealth gap has increased dramatically. The business class is disconnected from the struggle of the working man and doesn't understand.
So they blame it on the workers, saying they are work shy or entitled. Maybe certain employers are just greedy and treat workers poorly. Price gouging to take advantage of the inflation narrative, fraudulent PPP loans that were forgiven, invasive monitoring software. This is the fact of the matter, and you won't hear it from the media because the media is not run by working people.
Yes, you are right, "short on labor" is just poorly organized businesses with bloated management that see understaffing and overworking as a way to cut costs. Food and service workers in particular, speaking from experience, are tired of putting up with this nonsense, which is why you see unionization growing.
To quote Arrested Development, "'It's one banana, Michael. What could it cost, $10?'"
As a counterpoint, look at a company like Aldi, a German company that has succeeded in America.
Refused to price gouge during the lockdowns, lets their employees actually sit down, much more efficient workers that are treated like actual human beings. That's how you succeed, treat your service employees, or any employees for that matter, like actual human beings and pay them fairly. It's basic business ethics and it's good for business. For some reason, service workers in America are treated like sub-humans.
It's not like you need to coddle them or treat your workplace like a theme park a la SV tech giants, just basic dignity. That means a wage that can support a household, no weird ego / power-tripping business practices, no shady wage theft or tax-saving "benefits" that come out of paychecks. Turns out, if you treat your workers as you would want to be treated, then you get highly-productive and loyal employees that drive success.
Yes, even when you can legally get away with being unethical. Watching out for Uncle Sam is the bare minimum when it comes to labor practices. Long-term thinking wins out over short-term thinking every time.
Because the pay is fucking horrible, it’s really as simple as that
There Is no way in hell I’m busting my ass for $10/hr plus tips to be a waiter and deal with Karen’s all day, when I can work at the taco drive thru down the street for me at $18/hr
or some WFH data entry job that’s $20/hr, etc
I get that. However, if the pay is horrible, then (1) why would anyone work there/how are restaurants still open (I get its somewhat a step function process, so maybe this is step 1) and (2) how come some people still work at restaurants then?
Good question, and there’s a lot of subsets of people to unpack:
1) Older workers
This may seem a bit odd at first but if you recall where I broke down Atlanta rents you can see that I made an implicit assumption that the worker was unmarried or living together with a long-term spouse. If such is the case they might have bought a house years ago when things were much cheaper or both combined have the ability to split a studio / 1BR together and sleep on the same bed
2) People who choose to live at home. As of July ‘22 58% of young adults (aged 18-24 are living at home)
Note that these numbers are skewed by those who were temporarily remote, whether it be in education or jobs but the point still stands that for those who have parents who bought into Atlanta when it was cheap, those kids can work low level jobs without worrying about rent. Of course this cuts both ways as they no longer have the need to work 50+ hours, and can instead do part time work.
https://news.prudential.com/58-young-adults-are-still-living-at-home-im…
3) College Kids
Even if there are better alternatives such alternatives can get competitive. In the case of Atlanta , GTech is close to Midtown, so it may make sense to take a $10-$12 job there as opposed to seeking a warehouse job further outside the city.
4) Illegal Immigrants
I left this for last but really it’s a HUGE part of the service sector. I remember traveling in 2016, and staying at a Hilton. When I spoke to the housekeeping maid for my floor in English, she couldn’t understand me. I was absolutely stunned. That had never happened to me before, and I wouldn’t have expected it in a Hilton. I later came out to find that the hospitality sector and many of the big names heavily rely on illegals using loopholes in non-customer facing roles. Truth be told, if there were no illegal immigrants, we’d have experienced this shortage in workers 7-8 years ago. They delayed the inevitable shortage of rising rents but stagnating pay due to the fact that they are able to live in conditions that would be unthinkable for any local and even most legal immigrants.
Going forward I see illegal immigration coming down as it’s not popular on the right or the progressive left (Sandwrs is against open borders), for the clear reason outlined above that it leads to wage suppression.
I think the long-COVID thing is factoring in but rather in the way of vaccine injury and mental illness due to the pandemic. Maybe a minor factor.
I'll add a Canadian personal perspective: it seems that a lot of the unskilled labour is students/immigrants, many of whom work cash jobs. The situation is bad enough that the immigration minister temporarily removed a 20 hour/week cap for international students. So, keep bringing in students, keep the post-secondary institutions happy with the international student fees, keep worsening the housing shortage.
I realize this doesn't answer your question but it highlighted to me how at least a part of this system relies on a constant influx of cheap/illegal labour, at least up here.
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Dolore et accusantium fugiat consequatur ad. In aperiam et aut voluptatibus eos dolor. Molestias qui repellat at recusandae placeat dolores. Suscipit tempora iusto voluptatem et ea.