By JAMES BELL
Hays Post
The ongoing lack of available workforce in northwest Kansas continues to impact area businesses, but while many point to a specific cause for the lack of available workers, the reality is many factors are causing the labor shortage — and there are no quick fixes.
“It’s a problem for local businesses to find employees,” said Grow Hays Executive Director Doug Williams. “We have a bad situation with workforce.”
Unemployment numbers released by the Labor Market Information Services division of the Kansas Department of Labor and the Bureau of Labor Statistics showed Ellis County with an unemployment rate of only 1.9 percent in April, with many northwest Kansas counties coming in under 2 percent — and some as low as 1.4 percent.
“I’ve always said … there is an assumption in the industry that says 3 percent of the people really don’t want to work anyway, so when you are at 1.9 percent, the pickings are getting pretty slim,” Williams said.
Many economists will point to a 5 percent unemployment rate — called the natural unemployment rate — as expected in a healthy economy.
“You are always going to have some unemployment, but 1.9 percent is not a healthy rate for a community,” Williams said.
With a rate so low, many businesses in western Kansas have been significantly impacted.
“We have some businesses that have closed because of labor issues. We have some businesses that have changed their hours of operation,” he said. “It’s absolutely a problem locally."
But despite the ongoing debate about the federal enhanced unemployment benefit, which increased unemployment benefits by $300 a week in response to the continuing pandemic, as being the primary cause for workforce struggles, Williams said there is no simple solution that will immediately get more people into the local workforce.
“Like a lot of things, everybody gravitates to what they believe is the simple problem and solution,” Williams said, pointing to the demand by some to end the enhanced unemployment benefit. “I don’t think that will have a major impact on our workforce, even if it is eliminated.”
But for those who are receiving that benefit, Nigel Soria, senior research economist from the Kansas Department of Commerce, said additional workplace benefits and increased pay might entice some to enter the workforce.
“I think that is pretty key for what you are hearing in the news about people being less likely to go to work because of the additional benefits they might be making on unemployment,” Soria said. “Essentially, you are having to cover the opportunity cost for the value of their next best option. For many people right now, that next best option may be what they are making on unemployment.”
The necessity of covering that cost can financially impact businesses, but he said business leaders are working to balance worker needs and profitability.
“Ultimately, the goal is to put people first and help make sure people have what they need to be the best version of themselves, and I think there is going to be friction,” Soria said. “I think the right managers are going to do what they can do to see that that happens.”
But Williams said he believes the enhanced unemployment benefit is not a major unemployment factor locally.
“I would argue while there may be some cases of that in Ellis County, but that is not widespread in our community,” Williams said, noting workforce concerns were a local issue long before the pandemic.
“I think there are other factors,” he said.
Hundreds of fewer on-campus students at Fort Hays State University during the pandemic removed a substantial amount of the available workforce during the pandemic.
Childcare has also become problematic for many, Williams said.
He said one daycare center in Hays is booked until 2024, while others having long waiting lists.
“You take a parent that can’t find daycare for a child,” Williams said. “They have no choice but to stay home with that child. That’s a person that could be in the workforce, but because of a lack of daycare can’t be.”
He also noted many people have changed their personal lives due to the pandemic and may still be hesitant to return to the local workforce. Some have found work-from-home opportunities that find that type of employment works better for their living situation.
Two-parent households may have found having one parent stay home with young children outweighs the benefit of working.
Another issue, he said, that has a real impact is the lack of available housing in Ellis County.
“You can’t recruit people into a community if you don’t have housing,” Williams said.
Aging schools may also be driving people away from moving to Hays.
“We have allowed our facilities to become pretty much out of date and in disrepair in some cases,” Williams said.
All those factors together and others have created the current workforce shortage.
“I think a lot of little factors make a big difference,” Williams said. “When you look at the 1.9 percent, it amounts to about 350 people in our workforce. So you have 350 potential people that by definition, are unemployed and receiving benefits. That’s not very many.”
He said that presents challenges for existing businesses as well as economic growth potential.
“When we are trying to recruit organizations to come to our community, the first thing they look at is workforce,” Williams said. “They have got to have a workforce, so without one, we have really no chance of recruiting somebody.”
But even identifying the underlying causes of the labor shortfall, and working to address them, will not fix the problem overnight.
“We have to fix these things and, unfortunately, they are not quick fixes."