Low Wages, No Benefits, and Health Hazards

Dear Leading Ladies,

Last week, when the Nor’easter knocked out the power in many homes on the North Shore, a trip to Starbucks to take advantage of their free Wi-Fi and do some work seemed like a reasonable idea. What a surprise to find the local, usually busy, Starbucks closed with a sign that read something like, “Sorry for the inconvenience, but due to staffing constraints, this Starbucks had to close at 1 pm today.”

Hmmm, even Starbucks is being hit by the staffing crisis in the service business. So we got to wondering, what are the truths behind this reality? We suspected it was not what one of us had heard lately from an acquaintance: “It’s just that people don’t want to work and figured out they can make more staying home and living off the state. Another generation of welfare families in the making.”

But, as always, we need the facts to combat these wrong-headed assumptions.

To be clear, COVID-19 extended unemployment benefits from the federal government have ended. So what critics deemed a free ride, but which in fact kept many families afloat during the worst of the crisis, is no longer available. Some people may still qualify for unemployment benefits for a limited time from their states, but that has always been true. In fact, the cancellation of extended unemployment benefits has had “no visible positive effect on [the] labor supply,” according to Paul Krugman in The New York Times.

As for welfare benefits, in the US they include Medicaid and the Child’s Health Insurance Program (CHIP); Supplemental Nutrition Assistance Programs, known as SNAP or "food stamps"; Temporary Assistance for Needy Families (TANF); Housing Assistance; Supplemental Income Assistance; and Earned Income Tax Credit. Eligibility for welfare programs requires that a family of four earn under the poverty threshold of $26,000. Of note is that welfare rolls, specifically parents and children receiving TANF, declined during the pandemic despite economic upheaval, according to the Washington Post in August. So much for the welfare lines swelling with lazy bartenders and waitstaff.

For many of us, the pandemic has offered an opportunity to reassess priorities, life goals, and aspirations. Most restaurant workers were forced to leave their positions when the country was in lockdown. As places reopened, according to many industry periodicals, employees often made the decision not to return. According to National Restaurant News, a survey by Black Box Intelligence and Snagajob found that two-thirds of former and current restaurant employees listed disrespect from customers as a factor in the labor shortage, and one-half reported emotional abuse from their managers as a factor in their decisions about staying or leaving the workplace. Other factors included low wages and no set wage coupled with dwindling tips and no benefits; unavailability and expense of childcare, particularly now; opportunities in other industries (that they discovered during COVID); and concerns about mental and physical health in the restaurant business.

Another article in The Washington Post quotes a longtime restaurant worker as saying the pandemic just pushed her and others over the edge. It was “the final straw,” said Crystal Maher of Austin, Texas. Jim Conway, 64, left his position at Olive Garden outside Pittsburgh after almost 40 years in the industry. He was making just $2.83 an hour, the minimum wage for workers who receive tips in Pennsylvania, only 70 cents more than it was when he started in 1982. He said his main issue was safety. It’s hard not to imagine that a bigger paycheck and better benefits might have drawn him back.

In interviews with Eli Rosenberg of the Washington Post, ten current and former restaurant workers “described the pandemic as an awakening — realizing that long-held concerns about the industry were valid, and compounded by the new health concerns. And forced to stop working or look for other jobs early on in the pandemic, many realized they had other options.”

“The staffing issue has actually a lot more to do with the conditions that the industry was in before covid and people not wanting to go back to that, knowing what they would be facing with a pandemic on top of it,” explained Maher to Rosenberg.

So there it is. We don’t believe our Starbucks baristas are standing in line for their government handouts. We do believe they have found other jobs or are juggling schedules to take care of children or parents or grandparents. They are trying to pay their tuition or student loans or find a way to qualify for health insurance. Are there some who are trying to game the system? You bet. Just take a look at the cells of white collar criminals in the country club prisons if you want to talk about people who try to game the system. Just leave our server alone. And tip her well.

What gives you hope this week? We’d love to hear.

Therese
Judy
Mary
Beth
Leading Ladies Executive Team
ladies@leadingladiesvote.org