ADVOCACY GROUP VOCES DE LA
FRONTERA ACTION.
IN HIS STATE OF THE STATE
ADDRESS, GOVERNOR EVERS BOASTED
OF THE CURRENT UNEMPLOYMENT RATE
OOF 2.8% BEING THE LOWEST IN
WISCONSIN HISTORY.
NATIONAL LABOR STATISTICS SHOW
IN WISCONSIN 209,000 JOBS REMAIN
UNFILLED.
OUR NEXT GUEST, PROFESSOR OF
PUBLIC AFFAIRS IN ECONOMICS SAYS
THE WORD "SHORTAGE" IS A
MISNOMER.
SO WE WELCOME PROFESSOR MENZIE
CHINN.
THANKS VERY MUCH FOR BEING HERE.
>> WELL, THANKS FOR HAVING ME
ON, FREDERICA.
IT'S A PLEASURE TO BE HERE.
>> SO IF IT'S NOT A WORKER
SHORTAGE WHEN EMPLOYERS CAN'T
FILL JOBS, WHAT IS IT?
>> WELL, I THINK THERE'S A
DISTINCTION BETWEEN HOW
ECONOMISTS USE THE TERM SHORTAGE
AND HOW IT'S JE NARE CLEE
UNDERSTOOD.
SO A SHORTAGE WOULD BE, FOR
ECONOMISTS, WHERE WE WOULD SAY
FOR SOME REASON PRICES OR IN
THIS CASE WAGES AREN'T ALLOWED
TO MOVE UP TO THE LEVEL WHERE
PEOPLE ARE JOINING THE LABOR
FORCE AND TAKING JOBS IN THE
LEVELS THAT THEY WANT TO.
NOW THERE'S NOTHING THAT
RESTRICTS FIRMS FROM RAISING
WAGES AND BENEFITS AND WORKING
CONDITIONS SO THAT YOU FILL ALL
THE JOBS BUT IT TAKES SOME
AMOUNT OF TIME.
SO I THINK IT WOULD BE BETTER TO
SAY NOT A LABOR SHORTAGE, BUT
THERE'S A SHORTFALL IN THE
NUMBER OF PEOPLE WHO ARE WILLING
TO TAKE THE JOBS, GIVEN THE
WORKING CONDITIONS THAT FIRMS
ARE WILLING TO OFFER.
SO I THINK THAT'S A DISTINCTION
WE SHOULD PUT INTO PLACE, AND
THEN WE CAN THINK ABOUT WHY IS
IT THAT WORKERS AT THESE WAGES
AREN'T WILLING TO TAKE THE JOBS
THAT ARE AVAILABLE.
>> IS SALARY THE DEFINING FACTOR
THEN IN PEOPLE TAKING A JOB?
>> WELL, I THINK IT'S AP
FALSE -- OF CHARACTERISTICS.
FOR A LONG TIME, WE'VE HAD WHAT
HAS BEEN CALLED A SHORTAGE IN
WISCONSIN, THE APPROPRIATE
WORKERS THAT HAVE THE SKILLS
THAT ARE NECESSARY, BUT REALLY
NOTHING HAS STOPPED FIRMS FROM
GRAZIRAISING WAGES.
HOW FLEXIBLE IS WORK, IT'S THE
AVAILABILITY OF OTHER SOURCES OF
LABOR, FOR INSTANCE,
IMMIGRATION, TO ALLOW MORE
PEOPLE WHO ARE WILLING TO WORK
FOR WHATEVER GOING WAGES.
LOTS OF THESE THINGS HAVE JUST
BEEN EXACERBATED TREMENDOUSLY BY
PANDEMIC, WHEREIN FOR A WHILE,
BENEFITS WERE ELEVATED FOR GOOD
REASONS TO HELP WORKER WHO LOST
THEIR JOBS TO MANAGE THROUGH
THESE TIMES, BUT IN ADDITION TO
THAT, PEOPLE MIGHT SAY, WELL, I
CAN'T GET CHILD CARE DURING
THESE TIMES, AND SO IT'S VERY
HARD FOR ME TO GET ON MAYBE A
BUS SERVICE THAT DOESN'T EXIST
ANYMORE TO GET TO A JOB THAT
MIGHT BE AVAILABLE.
SO THOSE THINGS HAVE OCCURRED,
BUT THEN ALSO THE FEAR OF
INFECTION AND GETTING SICK.
SO WHAT'S HAPPENED IS YOU'VE HAD
A RE-ASSESSMENT BY A LOT OF
WORKERS, EITHER BECAUSE OF THE
CONSTRAINTS IMPOSED UPON THEM OR
JUST BECAUSE THEY'RE THINKING
ABOUT THE TRADEOFFS THAT EXIST
IN THEIR LIVES AND THE FACT THAT
MAYBE THEY'VE GOT A LITTLE BIT
OF SAVINGS SOCKED AWAY TO WAIT
OUT UNTIL THEY CAN FIND THE
RIGHT FIELD AND THE RIGHT -- I
THINK THE PERIOD IS ALREADY
DISSIPATING, YOU HAVE THIS
JUNCTURE BETWEEN JOB OPENINGS
AND THOSE JOB OPENINGS BEING
FILLED.
>> YOU SAY NOTHING IS STOPPING
EMPLOYER FROM RAISING WAGES.
BUT POTENTIALLY, YOU KNOW,
PROFITS?
>> SURE, AND IF YOU LOOK AT THE
AGGREGATE NUMBER, WHAT'S TRUE IS
PROFITS ARE SHOOTING WAY UP.
THEY HAVE SHOT WAY UP DURING
THIS PANDEMIC.
IF TU LOOK AT OVERALL PROFITS.
NOW WHAT'S TRUE IS, THE DEGREE
TO WHICH FIRMS CAN PASS ON THE
COSTS OF HIGHER WAGES DIFFERS A
LOT.
SO YOU SEE PROFITS JUMPING UP
FOR SOME MEAT PROCESSORS.
WELL, THERE'S A DEGREE OF
CONCENTRATION THERE, WHICH IS
MEETING AT THE SAME TIME HIGH
DEMAND FOR WHAT'S BEING
PRODUCED, AND SO THERE, WELL,
PROFITS ARE JUMPING UP EVEN IF
WAGES MIGHT ALSO BE RISING.
NOW OTHER FIRMS ARE GETTING MORE
EXPOSED TO COMPETITION, MAYBE
THERE ARE LOTS OF PRODUCERS SO
THEY DON'T HAVE THIS MONOPOLY
POWER, THEY'RE GOING TO BE LESS
ABLE TO PASS ON THOSE PRICE
INCREASES.
SO FOR SURE I SYMPATHIZE WITH
THOSE FIRMS, THEY'RE GOING TO
FEEL INCREDIBLY PRESSED AND SAY
I JUST CAN'T RAISE THE WAGES
ENOUGH WITHOUT SQUEEZING MY
PROFITS BELOW WHAT I CONSIDER
SURVIVABLE PROFITS.
SO I UNDERSTAND WHERE THEY'RE
COMING FROM, WHERE THEY SAY I
CAN'T RAISE THE WAGES, BUT IF
YOU THINK ABOUT HOW WE'VE ALWAYS
ARGUED THE FREE MARKET SYSTEM
SHOULD WORK AND PRICES AND WAGES
SHOULD MOVE TO EQUILIBRATE THE
MARKET, THAT'S NOT ACTUALLY A
CONSISTENT ANSWER.
>> SO WHAT KIND OF PUBLIC POLICY
COULD YOU BE PUT IN PLACE TO
HELP?
WOULD IT BE MOVING PEOPLE OFF
BENEFITS PROGRAMS OR BOOSTING
THINGS LIKE CHILD CARE TAX
CREDITS?
>> WELL, I THINK, YOU KNOW,
WITHOUT THINKING ABOUT THE
USEFULNESS OF EITHER OF THOSE,
IT'S TRUE, IF WE WERE TO REDUCE
BENEFITS AND REDUCE BENEFITS TO
ZERO, THAT WOULD PROBABLY
INCREASE THE LABOR FORCE
PARTICIPATION RATE, IT WOULD
INDUCE PEOPLE TO TAKE JOBS MORE
READILY, THAT'S FOR SURE.
I'M NOT SURE HOW BIG THAT EFFECT
IS.
I MEAN, FOR THE THINGS THAT ARE
BEING CONTEMPLATED, FOR
INSTANCE, WHEN WE ELIMINATED
EXTENDED OR ENHANCED
UNEMPLOYMENT EFFORTS IN
SEPTEMBER IN WISCONSIN, YOU SAW
AN ENORMOUS JUMP IN PEOPLE
WORKING IN THE LABOR FORCE, YOU
SAW A JUMP BUT NOT A BIG ONE.
ON THE OTHER HAND, YOU DO KNOW,
AND AT LEAST -- I HAVE THESE
RESPONSIBILITIES, EITHER PARENTS
THAT ARTICULATE -- AND THAT
CONSTRAINS THEM IN A TIME WHEN
SOME SERVICES LIKE
TRANSPORTATION MIGHT BE CUT BACK
AND PEOPLE CAN'T GET A CAR TO
TRAVEL TO WHERE THEY NEED TO
TAKE ON THE JOB, I THINK THERE
ARE A VARIETY OF CONSTRAINTS
THAT POLICY CAN SOMETIMES
MITIGATE.
THAT WOULD INCLUDE, FOR
INSTANCE, CHILD TAX CREDIT,
WHICH I'M SORRY TO SEE IS NOT
GOING TO BE, AS FAR AS I CAN
TELL, PART OF THE FEDERAL PLAN
OR WHAT WOULD BE POSSIBLY
CONTEMPLATED AT THE STATE LEVEL.
SO WE COULD DO THESE THINGS.
I WOULD SAY THAT IF YOU COULD
INDUCE PEOPLE TO, FOR INSTANCE,
GET MORE VACCINATION RATE UP SO
THAT PEOPLE HAD A BETTER
ASSESSMENT OF LOWER RISK OF
WORKING IN THE WORKPLACE, THAT,
TOO, WOULD BE SOMETHING THAT
CHANGES THE BENEFIT COST
CALCULATION FOR INDIVIDUAL
WORKER WHETHER TO TAKE A JOB OR
NOT.
PARTICULARLY IN THOSE SECTORS
THAT HAVE BEEN HURTING LIKE
LEISURE AND HOSPITALITY.
>> INDEED.
ALL RIGHT, MENZIE CHINN, THANK
YOU VERY MUCH.
THANKS FOR YOUR INFORMATION.