(TargetLiberty.org) – With the holidays just around the corner, many retail shops and businesses continue to face difficulties finding help. Rather than lacking access to the right people for the job, some organizations can’t attract any applicants at all. Some analysts worry that worker shortage will worsen inflation and drive up prices over Christmas, increasing financial strain on Americans and posing serious risks to the economy.
Worker Shortage Stymies Businesses
The National Retail Federation (NRF) reports that retailers will likely bring on 500,000 to 665,000 seasonal workers nationwide in advance of the impending holiday shopping season. While many of these jobs only last a few weeks or months, temporary staff play a critical role in allowing businesses to keep up with increased demand. The fact that businesses are already reporting difficulty finding people to work does not bode well for shoppers or companies.
The ongoing shortage of workers carries dire consequences for businesses of every size and level, ranging all the way from small mom-and-pop shops to major corporations. Smaller organizations tend to suffer the most severe side effects; too few workers often means they have to shorten hours or even close up shop.
Yet, experts say even conglomerates like Walmart, Macy’s, and Amazon face a protracted hiring challenge. An article from CBS News reports that Amazon is short approximately 150,000 people, while Kohl’s seeks 90,000 people. UPS is so desperate for workers that Communications Supervisor Sarah Shatan says they’re often hiring people on the spot, sometimes in less than half an hour.
With the NRF predicting a record-breaking retail sales season, those shortages amount to a double whammy for both businesses who are already struggling to keep up and the consumers who frequent them. It’s a recipe for disaster some analysts worry could end up having disastrous consequences on the economy for some time.
Economic Effects Could Last for Years
Job shortages affect the economy in a variety of ways. The most obvious fallout is the effect on day-to-day operations. A lack of workers slows production, which worsens supply chain struggles and creates backlogs in stock. When businesses produce or source fewer items, that means they’re also making fewer sales; less money flows into the economy.
There are other consequences, too. As we’ve seen over the past year, issues with the supply chain often drive prices up. Increased demand might even make it impossible to access certain products. Consumers can’t buy what isn’t available on the open market. While many will spend their money elsewhere, it still has the potential to pull cash out of the economy, which could worsen inflation.
Inequalities in how businesses cope with worker shortages also represent an economic risk. While conglomerates such as Walmart or Amazon often have access to the kind of money and resources needed to compensate, typically by offering astronomical increases in wages, signing bonuses, and other incentives, small businesses simply don’t have the same options.
Fewer working hours, a lack of stock, and temporary closures can be a death sentence for already-struggling small businesses. Holiday sales are often critical to their year-round viability. While they may not necessarily contribute as much to the economy as a major corporation like Amazon, collective losses, closures, and slumps still impact the economy. The situation also makes life a whole lot harder for the everyday middle-class Americans who run them.
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