Small business owner in Hampton Roads takes exception to president’s statements on unemployment benefits

Business

PORTSMOUTH, Va. (WAVY) — Jemmalyn Hewlett juggles seven businesses in Hampton Roads, including WeCare Salon+Spa, WeCare Salon Café, Poolside Cooking, and the Wecare Community Services.

“Here’s the problem, when we go through the process, they will call us for an interview, and won’t show up for the interview,” she said while sitting inside WeCare Salon Café, referring to trying to hire new employees.

Hewlett usually has 80 employees. Today, that number is 60, and she claims 22 are not returning because they are making more on the extended unemployment benefits.  

So, when President Joe Biden said earlier this week that his administration doesn’t see much evidence that people are being paid to stay home than go to work, she quickly said she doesn’t agree at all.

“The president doesn’t think the unemployment is an issue, but I think it is a huge issue. I am running multiple businesses, and I am pulling staff as an in-home coordinator, or a director to waitress or cook,” she said. “We literally had to shut down because we had no staff.” 

Small business owners like Hewlett who operate restaurants have complained for months they can’t find workers because unemployment benefits are more attractive than working. 

“I really think it needs to stop, and they need to go back to work. There are a lot of jobs out here that could be offered. It’s just a matter of wanting to go out and get it.” 

That is a cry also from the U.S. Chamber of Commerce to end the extra benefits before the Sept. 4 stop date. 

Biden also said it’s “easy to say the line is bent because of the general unemployment benefits and that is a major factor in labor shortages, but Americans want to work.” 

“When the president says ‘people want to work,’ no. You look at the pay, we can only pay what we are actually bringing in, so the numbers have to make sense,” Hewlett said.

Dr. Robert McNab is a professor of economics at Old Dominion University.

“On the margin, I will agree some people are saying ‘Why should I go to work for $10 an hour when I could make quote $15-18 an hour on unemployment insurance,” McNab said.

But McNab also says statistical evidence shows workers on unemployment are returning now to the labor force.

“When the job verification requirements come back in, it’s going to be really hard for them to collect through the summer,” he said.

McNab also says when he hears this argument of “working versus not working,” his first question always is “What are you offering?”

“Are you offering a wage that is $9 or $10 an hour, and are they seeing applicants at that wage? If not, they aren’t offering enough which is the double-edged sword,” he said.

Hewlett counters with a point about revenue versus expenses.

“Everybody wants what they feel they are worth, or they want more, but at the café, if we are kicking out more than what we are bringing in, that is an issue,” she said.  

It appears to be a classic supply-demand conundrum, and with a minimum wage proposed at $15 an hour, the fact is with the current workforce the minimum wage, in reality, may already be $15 an hour. 

“Statistics show it is turning around… 15-20% of jobs and leisure and hospitality went away last year now they are becoming back, and they are coming back rapidly, and that will continue as job verification requirements come back in,” McNab added.

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