‘On track for a total recovery.’ Local employment highest since pandemic began, but labor shortages persist – Cincinnati.com

The Cincinnati metro area is close to recovering all the jobs lost during the pandemic despite the evolutions of the coronavirus outbreak and nagging labor shortages still plaguing many industries.

Local employers added 2,400 jobs last November, boosting total employment to 1,087,600 – the highest level since the pandemic was declared in March 2020, according to the latest figures from the Ohio Department of Job and Family Services. 

At the same time, the metro area’s unemployment rate dipped to 3%, which was the lowest rate since at least 1990. It’s a dramatic shift from the month after the pandemic began when the metro area’s unemployment rate hit 13.6%. 

The 3% rate was tied with Columbus for the lowest unemployment rate in November among Ohio’s four major metros. By comparison, the Dayton area unemployment rate was 3.5%, and the Cleveland area posted a November rate of 3.7%.  

But the metro area is still 3,200 jobs shy of employment in February 2020 — the month before the pandemic began – and hiring remains a challenge.  

“We’ve looked at every opportunity possible to attract workers, from retention bonuses to higher wages upfront, but on any given day, we still have vacancies at all of our hotels,” said Vinay Patel, CEO of Sree Hotels LLC.

Sree owns the Courtyard by Marriott; the Cincinnatian Hotel; and the Hampton Inn & Suites and Homewood Suites in Downtown.

Earlier this month, the four hotels had 42 open positions, including openings for bartenders and cooks at the Courtyard that have kept the Bistro bar and restaurant on the second floor closed since the newly remodeled hotel opened last summer. 

“Honestly, it (labor shortage) is a head-scratcher,” Patel said. “I don’t know what the real answer is, but we gotta find it here real soon.”   

‘It was never this difficult’ 

Leisure and hospitality, which includes hotels and restaurants, has been one of the job sectors hardest hit by the pandemic, shedding 14,600 jobs in the Cincinnati area over the course of the pandemic, local jobs data shows.

Many workers were laid off as business screeched to a halt at the height of the pandemic or quit to avoid exposure to the coronavirus, but they haven’t come back.

“Our biggest struggle is just getting people to put applications in,” said Tina Setters, the kitchen manager at Garzelli’s Pub & Pizza in Erlanger, Kentucky, where a giant banner out front reads: “NOW HIRING KITCHEN STAFF.”

“We’ve had that sign up for months now, and we don’t get many applications in at all,” Setters said. “It was never this difficult before the virus hit.”

It’s not only hard to find workers, it’s hard to keep them once they’re on the payroll.

Nationwide, a record 4.5 million American workers quit or changed jobs in November, according to the U.S. Bureau of Labor Statistics.

Compounding the problem: there just aren’t as many workers to choose from anymore.

The missing 15,000 workers

Over the past two years, the number of people working or looking for work in the Cincinnati metro area fell by more than 15,000, according to labor force figures from the Ohio jobs department. 

So in addition to unemployed people finding new jobs, the unemployment rate is also lower because some of the unemployed have simply dropped out of the labor force. 

Some experts attribute the shrinking labor pool and persistent labor shortages to demographic and economic trends that were pulled forward during the pandemic, including:

  • Early retirements by workers whose investments have flourished during the bull market in stocks or who left the workforce to avoid exposure to the coronavirus.
  • The rise of the gig economy, which allows former employees to become independent contractors.
  • And, a critical shortage of childcare workers, which has hampered many parents’ ability to return to work.

“Those are all factors that have changed the makeup of our labor force,” said Michael Shields, a researcher with Policy Matter Ohio, a nonpartisan think tank in Cleveland. “Some of those may be long-term issues. People who have already retired aren’t coming back.”

Others have blamed government spending on pandemic-induced extended unemployment benefits for keeping workers on the sidelines for too long.

“That argument never held much water,” according to Shields, who noted pandemic unemployment assistance benefits expired in August, pushing out 240,273 Ohioans who were covered during the program’s final week.

Researchers knew even before those programs ended that ending them would not push people back into the labor force,” he said.

Statewide, Ohio still has a deficit of more than 200,000 jobs since before the pandemic struck, and just four sectors have fully recovered jobs lost during the pandemic, Policy Matters’ research shows.

Despite the challenges, Shields said he expects a full recovery in Ohio by 2023, thanks to unprecedented fiscal stimulus and the emergence of highly effective vaccines and therapeutics developed to address the pandemic.

The Cincinnati area is likely to recover even faster, he said.

“There’s a rapid recovery going on for Cincinnati, Ohio and the nation as a whole, but Cincinnati is recovery slightly faster, and I’m very encouraged about that,” he said. “There are some big ‘ifs’ out there, but we’re on track for a total recovery.”

By comparison, it took Ohio more than twice as long, until May 2015, to restore all the jobs lost in the Great Recession that began in December 2007, he said.