Labor shortage provides opportunity to ‘raise the floor’ for hospitality workers in NOLA

Published: May. 11, 2021 at 12:29 PM CDT
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NEW ORLEANS (WVUE) - As a growing number of Republican-led states move to end the extra $300 a week in federal COVID-19 unemployment benefits to spur labor growth, New Orleans spokesperson Beau Tidwell says this is an opportunity to “raise the floor.”

“What we need really is an increase in wages. We need better benefits,” Tidwell said at the city’s weekly press conference on Tuesday. “That’s something the mayor is very much in favor of and she would like to see our hospitality industry be leaders in that regard.”

Alabama, Arkansas, Mississippi, South Carolina, and Montana have all announced an end to the federal program after an employment report in April found that the economy gained only 266,000 jobs, and unemployment in the United States rose from 6% to 6.1%, contrary to expectations.

“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” the U.S. Chamber of Commerce said Friday.

The American Rescue Plan passed in March extended $300 unemployment benefits through early September.

The unemployment rate in Louisiana is at 7.3%, slightly down from February of this year, and nearly half of 13.1% in May of 2020.

More: US job growth slows sharply in sign of struggles

“Right now where we are in our economy, specifically our hospitality economy, which we are hugely dependent on,” Tidwell says. “This is an opportunity to really raise the floor for our people.”

President Joe Biden says the enhanced federal benefits are not to blame.

“The line has been because of the generous unemployment benefits, that it’s a major factor in labor shortages. Americans want to work. Americans want to work.” Biden said at the White House on Monday. “I think the people claiming Americans won’t work even if they find a good and fair opportunity underestimate the American people.”

Anyone collecting unemployment who is offered a “suitable job” must take that job or lose unemployment benefits, Biden said, with several exceptions that mean people do not have to choose between their safety and a paycheck.

Restaurants in New Orleans, thrilled to have restrictions lifted to bring in more business, are having problems getting back to full staff.

“I could use about 30 percent more employees,” Andrea Apuzzo, owner of Andrea’s, says. “I lost 20 to 30 percent.”

More: New Orleans restaurants feel COVID-19 labor pinch

“We could easily hire 20 to 24 people today,” Drago’s owner Tommy Cvitanovich said. “I need them.”

The combined unemployment benefits mean that anyone earning less than $32,000 a year can potentially receive more income from unemployment aid than from their previous jobs, according to economists at Bank of America.

White House press secretary Jen Psaki said Monday “bigger factors” are keeping people home than increased unemployment benefits. She said vaccination rates, childcare and school reopenings all have an impact. And employers, she said, need to pay a “livable working wage.”

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