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On Unemployment, Democrat Joe Manchin Hit The Nail On the Head

By Andy Puzder for RealClearPolitics

Joe Manchin said it best: “We have 11 million jobs that we haven’t filled, 8 million people still unemployed. Something’s not matching up here.” The West Virginia senator’s instincts are right. During the pandemic, something fundamentally altered in the labor markets.

There are fewer people willing to do work.

Since 1974, The National Federation of Independent Business (NFIB) has conducted a monthly survey of small-business owners. The August results were disconcerting. A 48-year record high —   50% — reported job openings that could not be filled. Of those owners hiring or trying to hire, 91% reported there were few or no “qualified” applicants.

A record high 29% reporting no – zero – qualified applicants. This is despite 41% of respondents reporting they received increased compensation. As a result, another record high — 28% — identified labor quality as their top business problem.

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So, what’s causing these historically bad results?

Conservatives think that the federal unemployment insurance benefit of $300 per week, which expired on September 1, suppressed labor markets. That makes intuitive sense and Goldman Sachs’ economists project that ending this program “will account for 1.5 million job gains through the end of the year.”

But even assuming that is true, there were 5.3 million fewer jobs in August than when the pandemic began.

Attempting to explain the dismal August jobs numbers, President Biden blamed the delta variant. But 77% of Americans over 18 have had at least one vaccine shot and 68% have had both. About 700,000 additional doses are being administered every day.

Add in unvaccinated individuals with natural immunity and one analysis recently found that roughly 80% of the country already has vaccinated or natural immunity.

The reality is that neither the viral nor weekly unemployment bonuses fully account for the severity of the labor shortage. To determine if there were other explanations for the slow return to work, I spoke with 10 business owners in the retail sector that I’ve known for years.

Some people mentioned COVID or the federal unemployment bonus, but their main concern was the fact that many people have lost the drive to work after receiving more than one year of government assistance. They had a range of experiences, from no one wanting to work to potential employees refusing to accept jobs that involved working nights or weekends.

The business owners were all willing to increase pay to get good employees but believe they are competing with work-free government largesse – and losing.

While Americans had $400 billion more in savings in July than when the pandemic began, the Biden administration has increased food stamp benefits by 25% and Democrats now want to make the current $3,600 per year tax credit for children under 6 – and $3,000 for older children – permanent rather than letting it expire next July.

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A good example is the rising government support mentality that businesses face with regards to child tax credits. The very successful 1996 bipartisan welfare reform effort required that a substantial percentage of those receiving welfare work, if they were able bodied.

Both employees and employers seeking to hire were benefited by these reforms. They enabled struggling families to get jobs and become financially self-sufficient, helping them lift themselves out of poverty. The employment market was growing.

This success is not being recognized by the child tax credit. Expressing concern with the structure – not the substance – of making this program permanent, Sen. Manchin complained that “[t]here’s no work requirements whatsoever. There’s no education requirements whatsoever for better skill sets. Don’t you think, if we’re going to help the children, that the [parents] should make some effort?”

Manchin also got this right. But, apparently, encouraging work is not his party’s goal.

Everyone wants to see children lifted out of poverty. We also want – and employers want to provide – good jobs and fulfilling careers. If the government seduces people with low incomes, they will be forced to live off the wealth of others rather than achieving their full potential and gaining financial independence.

Government dependence is neither the way out of poverty nor the path back to 2019’s thriving pre-pandemic labor market – where the labor force and real incomes were growing, family income hit a historic high while poverty hit historic lows both generally and for minorities.

As for child poverty, it decreased to 14.4%, the lowest child poverty rate since 1973 – down from 18% at the end of the Obama/Biden era. Job is truly the best family welfare program.

If encouraging hard work isn’t the end goal, then what is? 

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Increasingly, Biden and the Democrats are attempting to cobble together the socialists’ dream program – universal basic income with cradle-to-grave government dependence. It should be no surprise.

As Biden acknowledged in May of 2020, progressives have long viewed the pandemic as an “incredible opportunity” to “fundamentally transform” America. Given the low number of jobs, the difficulty for businesses to find workers, and our declining work ethic we can trust them.

RealClearWire granted permission to syndicate.

Andy Puzder is the former CEO of CKE Restaurants, a board member of the Job Creators Network, a senior fellow at Pepperdine University’s School of Public Policy, and the author of “The Capitalist Comeback: The Trump Boom and the Left’s Plot to Stop It.”

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