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Jobs are everywhere in Nebraska. Workers? Not so much
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Jobs are everywhere in Nebraska. Workers? Not so much

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US Weekly Jobless Claims Hit , New Pandemic-Era Low. The Labor Department reported a total of 348,000 jobless claims for the week that ended on Aug. 14. The number is down 29,000 from the previous week and less than the Dow Jones estimate of 365,000. Ongoing claims fell to 2.82 million, which is also a new pandemic-era low. First-time filings for unemployment insurance hit a new low, despite worries over the delta variant. The last time claims were this low was Mar. 14, 2020, just as the COVID-19 pandemic declaration was announced. Despite the new low, the jobs gap remains large, with six million fewer Americans being considered employed now than prior to the pandemic. Economists suspect a number of reasons for this, including many workers pushing for extra protections as a result of the ongoing pandemic. As a result, wages have been increasing with average hourly wages up 4% year over year in July

There’s never been a better time to find a job in Nebraska.

That was a quote from Gov. Pete Ricketts contained in a Friday announcement celebrating Nebraska's record-low August unemployment rate of 2.2%.

But there may never have been a worse time for companies looking to find workers in the state.

A recent study from careers website CareerCloud found that Nebraska has the second-worst labor shortage in the country, with 1.8 jobs open for every unemployed person. That was second only to the District of Columbia.

That shortage has shown itself most acutely in the services sector, where numerous businesses have had to cut back hours and even close locations temporarily because of a lack of available workers.

One of the latest is Godfather's Pizza, which announced Monday on Facebook that it was closing its restaurant near 48th Street and Nebraska 2 for an undetermined amount of time because of a lack of staff.

"Like much of the restaurant industry, we are experiencing a staffing shortage," the post said. "Our 48th Street location will be temporarily closed until further notice while we work tirelessly to find new individuals to join our crew."

That comes on the heels of incidents in the past couple of months that caused a Lincoln Burger King location and Family Dollar store to close temporarily after large numbers of employees all quit at once.

But it's not just retail and food service businesses that are having trouble hiring. Businesses from manufacturing to construction to state government are struggling to fill openings in Lincoln and elsewhere.

Much of that is due to the labor force not growing as much as the job market.

Nebraska Commissioner of Labor John Albin said Friday that the number of people employed in August finally reached its pre-pandemic level, at just short of 1 million. That number was about 12,000 more than a year ago. However, the number of jobs increased more than 33,000 from a year ago, leaving a gap of more than 20,000.

The numbers were similar in the Lincoln area, with the number of employed people having increased about 5,200 from a year ago, but the number of jobs available up by more than 7,100.

That mismatch has led to an "incredibly tight" labor market, Bryan Seck said.

Seck spent years as the director of workforce development at the Lincoln Partnership for Economic Development before moving a couple of months ago to Kawasaki Motors Manufacturing, where he heads up recruiting for the company's plant in Lincoln, as well as one in Maryville, Missouri.

Kawasaki in July announced plans for a $200 million expansion that will both add capacity to its 2.4 million square feet of manufacturing space at its operations at Northwest 27th Street and U.S. 34 and also increase automation.

The increased automation is largely in response to the difficulty in finding enough people to hire in Lincoln. But even with that innovation, Kawasaki estimates it still will need to hire an additional 550 people over the next 18 months.

That could be tough in the current environment. According to the Nebraska Department of Labor, manufacturing employment is at its highest level in the state since 2008.

Kawasaki is undeterred, though. On Thursday, it held a job fair to fill current openings and also recruit a chunk of those new employees.

Seck said people were standing in line a half-hour before the event began and more than 100 job seekers eventually showed up over the course of the three-hour fair.

"This is exactly what we hoped for," he said, although he conceded he really didn't know what to expect.

Seck said people there Thursday were filling out an application and would be invited back as soon as Friday to complete a skills assessment. Those who passed that assessment were likely to be given conditional job offers on the spot, pending results of background checks and drug screenings. Seck said one person had already been hired as of Friday afternoon.

Seck said he expected a lot of the applicants would be looking to move to a better-paying job or move from part-time work to full-time work. He said he did not expect many unemployed people, however, because "there just aren't many people in Lincoln who are unemployed."

That was borne out in the numbers released Friday, which showed the unemployment rate in August in the Lincoln Metropolitan Statistical Area was 1.7%, the lowest ever recorded in data going back to 1990. The state unemployment rate of 2.2% was the lowest in records going back to 1976.

Kawasaki is hiring for positions that start at $18 an hour and offer a full benefits package. That's a decent wage, but it's well below the average manufacturing wage in Lincoln of more than $21 an hour and the overall average for all jobs of nearly $24 an hour.

Seck said the benefits and the regular full-time hours the jobs offer are a draw to people who have families or are looking for career stability.

"This is the security they're looking for," he said.

It was that security, particularly the benefits, that drew Jayric McDonald to Thursday's job fair.

"This would be my first job," said the 18-year-old recent graduate of Lincoln North Star High School.

McDonald said his brother previously worked at Kawasaki and had good things to say about the company. He said his brother's experience, combined with the pay and benefits Kawasaki is offering, were enticing.

Eric Thompson, director of the Bureau of Business Research at the University of Nebraska-Lincoln, said Kawasaki, as a premier employer in Lincoln with nearly 2,500 workers, "will have more success in hiring than most companies," with the potential to draw already employed workers looking for better pay and benefits.

But companies on the lower end of the scale will continue to struggle to find workers.

Nebraska has long had a low unemployment rate and high worker participation, something that's usually a good thing, but in current conditions, where labor participation is down due to the coronavirus pandemic and short recession, it's "a very difficult situation for employers," Thompson said, one that's exacerbated by all of the federal relief in the form of enhanced unemployment benefits and three rounds of stimulus checks.

"This is part of the reason the hiring challenges are more severe in the current economic recovery," he said.

Many businesses have been raising wages, offering bonuses and using a number of other enticements to find workers.

Sam's Club is the latest retailer to announce it will raise its starting wage to $15 an hour, following Walgreens and other national chains.

While that strategy can work for large national retailers, it's not one that all companies can or want to adopt.

"Businesses always have job openings, and there is a tension in terms of offering more wages and benefits versus remaining cost-competitive," Thompson said. "That tension remains. For some businesses, it may be better to tolerate a period with more open positions than to raise wages and benefits. It depends on a company's competitive situation."

Low pay and government stimulus are not the only reasons people may be hesitant to reenter the workforce, said Creighton University economics professor Ernie Goss.

There are still people who are worried about COVID-19 and who may live with vulnerable relatives. There are also issues such as skills mismatches and an inability or lack of desire to move from places where jobs are scarce to places where they are plentiful, he said.

Lack of available and affordable child care options also can be a hurdle, Goss said.

Hy-Vee is one company that's attempting to tackle multiple issues to help in its quest for more workers.

The Iowa-based supermarket chain announced earlier this month that it's partnering with WeeCare, the nation’s largest child care network, to offer concierge services for both full- and part-time employees to help them find in-home child care. Hy-Vee employees also get free subscriptions to Care.com, to find caregivers and other personal services workers.

"Many of our employees are parents or caregivers, and having affordable, trustworthy child care when they come to work every day helps give them peace of mind," Randy Edeker, Hy-Vee's president and CEO, said in a news release.

On Friday, Hy-Vee also announced that it's starting a free apprenticeship program for pharmacy technicians to help them become nationally certified to administer vaccinations. The company said it's seeking to hire 2,000 of the techs across its eight-state area.

While offering more pay and better perks is sure to attract some people to get back into the workforce, the economists believe changes in government policy might be needed to solve the latest labor shortage.

Goss said there needs to be more means testing and time limits on federal benefits, but he also recommended more investment in community college training programs, as well as increased infrastructure spending.

Thompson said he generally agreed with those recommendations, but he threw out another one: reducing marginal income and sales tax rates, which are likely to benefit the middle and lower classes more.

"These policies would have long-term benefits but also might incentivize an immediate jolt to labor force participation," he said.

Reach the writer at 402-473-2647 or molberding@journalstar.com.

On Twitter @LincolnBizBuzz.

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