Posted on 08/25/2007 5:30:31 AM PDT by Hydroshock
HELENA, Mont. - The owner of a fast food joint in Montana's booming oil patch found himself outsourcing the drive-thru window to a Texas telemarketing firm, not because it's cheaper but because he can't find workers.
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Record low unemployment across parts of the West has created tough working conditions for business owners, who in places are being forced to boost wages or be creative to fill their jobs.
John Francis, who owns the McDonald's in Sidney, Mont., said he tried advertising in the local newspaper and even offered up to $10 an hour to compete with higher-paying oil field jobs. Yet the only calls were from other business owners upset they would have to raise wages, too. Of course, Francis' current employees also wanted a pay hike.
"I don't know what the answer is," Francis said. "There's just nobody around that wants to work."
Unemployment rates have been as low as 2 percent this year in places like Montana, and nearly as low in neighboring states. Economists cite such factors as an aging work force and booming tourism economies for the tight labor market.
For places like Montana, it has been a steady climb in the nearly two decades since the timber and mining industry recession. The state approached double-digit unemployment levels in the 1980s and began the slow crawl back in the early 1990s.
"This is actually the biggest economic story of our time, and we don't quite grasp it because it is 15 years in the making," said economist Larry Swanson, director of the O'Connor Center for the Rocky Mountain West at the University of Montana.
The U.S. Department of Labor reports the mountain West region — covering eight states along the Rocky Mountains — has the lowest overall unemployment rate in the nation. The region hit an all-time low of 3.4 percent in May.
The effects are everywhere. Logging equipment in Idaho sits idle as companies have a tough time finding workers. A shortage of lifeguards has forced Helena to shorten hours at children-only pools. A local paper in Jackson, Wyo., has page after page of help wanted ads.
In Jackson Hole, the Four Seasons Resort still had openings in late July. The problem has created longer hours and tougher working conditions for current employees.
For years, the resort has imported dozens of workers from Eastern Europe who often come as much for the summer recreation opportunity as the money. This year, however, that wasn't enough and so for the first time the resort also sent recruiters to a high school job fair, said spokeswoman Greer Terry. It only helped a little.
"It's been a struggle finding employees this summer," Terry said.
Economists say there are a number of reasons why parts of the West are feeling the labor pinch.
Established baby boomers, including retirees, have been moving into Montana for the mountain views and recreation, bringing with them money for new homes that fuel construction job growth, said Swanson.
Along the way, younger people have moved away searching for bigger paychecks as the state's wages still lag behind other areas and are slowly increasing overall. Now, the aging work force is unable to expand to meet the demands of the job market, Swanson said.
He said the problem is compounded by the fact that employers, accustomed to paying relatively low wages, have been slow to increase salaries. Montana wages have historically been among the lowest in the country, and still rank near the bottom. The silver lining for workers is that wages are now growing at the third-fastest rate among U.S. states.
Now, workers with more options in some places are unwilling to take $12-an-hour jobs.
The problem could get worse as more baby boomers retire, Swanson said. By 2030, Montana and Wyoming are predicted to have among the oldest populations in the U.S, with about 26 percent of residents 65 and older, Swanson said. That compares to 19.7 percent predicted nationally.
"We thought the labor force crunch wouldn't come until 2012, but it's already arrived in a lot of these fast-growth areas," Swanson said. As a result, "you'll find older workers working longer, people will sort of linger in the work force. The employers will make it worth their time to."
Swanson added the phenomenon of quasi-retirement with older workers cutting back on hours but still heading to the office will grow, while international workers will be drawn to the region. Younger workers who used to leave will find it worth their while to stay.
"The squeeze is on. You get into these 2 percent and less unemployment rates and you're moving into a seller's market with the seller being the worker," Swanson said.
Officials worry the razor thin labor market could bind economic growth, although there has been no indication of that yet.
"One of the reasons we are seeing the lower (unemployment) rates is we are starting to see more investment in our economy. It's like finding an undervalued stock," said Tyler Turner, Montana's economic development chief.
In Helena, the pool of applicants has been shrinking even for jobs on the police force. For professional jobs, such as department managers, the city is considering hiring slightly underqualified people that can be trained on the job.
"This is the tightest market I have ever seen," said Salty Payne, who has worked in the Helena City human resource office for 15 years.
Payne in part blames the area's building boom, which is drawing workers to construction trades that are offering higher salaries.
Montana state lawmaker Art Noonan lives in the mining town of Butte — the epicenter of a big mining bust 20 years ago. Now, more people are moving in to build second homes and high paying jobs are coming back as copper prices go up.
"All of these things are sort of clicking at the same time," Noonan said. "The only economic development we used to get was the creation of more economic development offices."
In Utah — where unemployment rates have been hovering around 2.5 percent — amusement parks, trucking companies, telemarketing firms and others have been paying bonuses of hundreds of dollars or more to find workers.
"It boils down to the attractiveness of the (interior) West," said Mark Knold, chief economist at the Utah Department of Workforce Services. "It is a population magnet."
And workers have benefited. Utah workers saw a 5.4 percent average wage increase in 2006, Knold said.
But questions remain about how long the West can weather the problems that come with low unemployment.
"The hardest thing is to keep the economy growing at a strong rate when you have a low unemployment rate," he said. "Take a company that wants to expand. Where is the next worker going to come from?"
1. I expect to hear more of this from the OBL to try to get some amnesty.
2. If no one will work for you for $10 an hour you might want to pay $11 or $12. The free market cuts both ways.
Or perhaps the word is out that he's a jerk as a boss?
American workers seem to be spoiled a bit, don't they?
For the Welfarers-for-life, why work at all when the government takes care of them? There are generations of welfare lifers.
The answer is that the wages have to be high enough to lure workers to the snow country OR those business owners will have to move to where the weather is better.
Is there another answer that's practical?
“The boss” can go haul his @ss down to the unemployment office and start looking for work like everyone else.
He has no right to continue a fail business by demanding anything from government, least of all changes in the law.
I’m interested.
How much could I make as an average mountain man? :}
It sounds to me like everything is working well. The one guy used technology to solve his problem. The other started recruiting high school students. And low wages are going up.
I don’t think that’s what the sentence meant.
They won’t take $12 an hour jobs, because they can get a higher salary somewhere else.
” 2. If no one will work for you for $10 an hour you might want to pay $11 or $12. “
Nobody talks about ‘cost push inflation’ because it’s scary, nasty stuff which can’t be addressed by minor manipulation of interest rates....
Our last experience with this was in the ‘70’s (remember ‘wage-price spiral’?) when the Fed’s solution was to raise interest rates dramatically enough to induce a recession....
These problems will end when a workable program for legal vetted immigrants is started. It ain’t rocket science. Instead of building bridges to nowhere how about a system to bring decent people with no criminal record. Seasonal jobs should bring people in and when the job is over they go back. This country is not adverse to immigrant but we should shoot for the best. We have enough welfare recipients we don’t need to import them.
If Geography and wise educating were actually practiced ... I think you might see inner city kids, feeling hopeless and forgotten, (isn't that the mantra ? ) opt to take a wise employer up on a 'Job Corps' type of offer, move their ambitious but idle asses out to the big sky country and LO! .. perhaps actually develop a taste for life and freedom and become productive members of this great land.
Or maybe the welfare system could get off their asses and turn loose the money needed for trasnsportation to and housing in these places that need workers.
Why do boot camps have to be chain gangs with D.I.'s ?
Yea I sure as hell remember that. That was the fix for having a moronic peanut farmer as president.
A similar situation is developing nationwide.
We don’t have enough workers. The answer is to allow for more LEGAL immigration.
I don’t have much faith in the ability of our government to function in an efficient manner but we need to let in a bunch more LEGAL immigrants, from all over the world, not just Mexico.
Our country is great because of our immigrant past. And because it was hard to get here. Only the intelligent and hard working figured out a way to get here.
But we (the people) get to decide who comes, not those rushing the border.
We need people enthusiastic about becoming Americans not ones who want to come here and turn it in their third world crap. If your religion is that adverse to our culture(pork and all) then keep your ass where you are.
Agreed, that and we might not need as much as we have adn make sure they have some education.
In 92 I advertised for a secretary at $6.00/hr and got hundreds of applicants because downsizing had put a lot of people out on the market. Two years later I needed a secretary and there were no applicants from any source. When I got a referral through an employee and I wanted to hire her, I asked her what she thought she was worth. She named a figure about 40% higher than she was currently earning. After checking her referances, that is what I offered her. but she turned out to be so good, that I was paying her another 30% more within a few months and glad to have her.
That whole experience left me convinced that high unemployment really comes from a shortage of entrepreneurship. Turn a bunch of middle managers lose from the phone company and some of them figure out that they will have to start businesses to get what they want. Then they hire the rest. Then, if you have Democrats in government, they will come after the businesses with their anti corporate populism and screw everything up again. Their focus on jobs ios less productive than it would be to develop entrepreneurs. The IRS is the main destroyer of entrepreneurs.
A boss who insists on being a jerk in a tight labor market will find himself in a world of hurt.The days of BS and intimidation from managers are coming to an end.
The great financial bankers and captains of industry do not realize that if the public is to buy their products it must make enough money to afford them.
America did not become the greatest economic power in history by using slave labor. Slaves in early American history were economically possible only because they were used in a limited number of labor-intensive agricultural crops. Technology has since made even the use of slaves to pick crops unprofitable.
Remember that slaves were not used in the industrial North. Now the politicians want to use labor slaves in the U. S. It is not that Americans will not do the work that so-called immigrants do, but that Americans will not do the work at the level of wages paid to unskilled and uneducated Mexican illegal aliens.
Pay enough and all jobs will be filled. For the most part that has already happened that’s why the unemployment figures are at record lows.
No sir, everybody is working, in fact the 2% are probably working for cash.
Too much work for people to choose from... Man, America really does suck, don't it?
/s (did I need that?)
The answer seems obvious.
Well - I am wondering - even at 2.x % unemployment - that means SOMEONE is drawing an unemployment check...and probably other government benefits.
It is WAY PAST time for a crackdown on government handout recipients - if you don’t at least TRY to support yourself with the jobs that are available. Heck - I don’t even mind helping folks who cannot pay for basics with the jobs available. But as Rush is fond of saying - if you take a low paying job and prove yourself, you don’t stay in such low-paying jobs.
But this is lost on too many lazy, “I want a high paying-cushy job” to start off with people. AS long as there are jobs available and people on unemployment lists, government checks should be few and far between - thus there should be a lower tax burden, thus more money in the economy to fuel higher wages and investment, and so on...
But I guess I am just a mean old “conservative”...
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