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Chattanooga businesses face hiring struggle: "We cannot compete with the U.S. government"

Image of a sign on display at Rib & Loin in Chattanooga. (Image: WTVC)
Image of a sign on display at Rib & Loin in Chattanooga. (Image: WTVC)
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UPDATE (Thursday, May 6):

Chattanooga businesses are struggling to hire and keep staff.

Now, new changes to Tennessee's unemployment laws aim to get people back to work full-time - but some residents say it will hurt families.

Eryn Cooper breaks down what the unemployment bill entails, and why people are fired up.

ORIGINAL STORY (Wednesday, May 5):

Some Chattanooga business owners say they’re struggling right now, but not for the reasons you might expect.

The Wood Gallery says they are struggling to find workers that can help turn their wood into a finished product.

Co-owner John Biggs says it's a problem that's gotten worse following the pandemic. He says he can’t find labor to operate machines and assemble products in his shop.

"You know, we had one employee just quit. Says, 'I can make more at home,'" said Biggs.

Biggs says prior to the pandemic they were getting three to five applications a month to work in their shop. The HR director tells us those applications are now down to “one a month, if we’re lucky.”

The Wood Gallery tells us they believe their wages are competitive for the industry. The HR director told us salaries start at $12 or $13 an hour.

It’s well above Tennessee's current minimum wage of $7.25.

"As a company, as a manufacturer, we cannot compete with the U.S. government. And a lot of times, that's what's happening right now," said Biggs.

It’s not just the Wood Gallery that’s looking to hire new help. It’s something owners say they’re struggling with across different industries.

CEO of U.S. Xpress addressed the labor concerns at an infrastructure roundtable in Chattanooga hosted with industry leaders on Tuesday.

"We have a real issue today with finding employees. I think everybody is struggling to find employees. People don’t seem to want to work in this environment," said U.S. Xpress CEO Eric Fuller.

Signs asking for help have become commonplace at restaurants throughout our area.

Rib & Loin in Hixson said they'd like to hire five to seven more people. They say they had to close their dining room Wednesday because only two people showed up for work that morning.

"Our average person usually makes between $11 to $13 an hour. And if you've been here longer, you make a little more. I mean, we pay good wages, it's just people aren't working right now. I guess with all the other stuff going on, you know? But we've tried," said manager Lisa Clark.

Clark says she's hired employees who have trained for a bit, but ultimately told her they made more on unemployment.

"They can grow more unemployment than they can make in a paycheck," explained Clark.

But despite some businesses struggling, experts say the increased benefits of unemployment outweigh the negatives.

Andrew Stettner is a senior fellow with The Century Foundation and is an expert on Unemployment Insurance Benefits. He says it's important to remember that despite "anecdotal cases," there are not enough jobs to support the people currently receiving unemployment benefits.

The Bureau of Labor Statistics says right now, the number of unemployed persons is 9.7 million.

"You have to step back and look at this on a macro basis. There's still many people still out of work, and the economy is not back enough for them to get a job. If we were to change the system, the unemployment system, the damage to the economy would be far greater," said Stettner.

And with some jobs less attractive to people because of COVID dangers, he says employers should consider upping wages.

"The minimum wage is at a very low level in many states. That's an issue with people going back to work, especially if they switch from doing a job that maybe was well paid before, and that's unavailable," said Stettner.

Stettner says as the economy continues to strengthen this issue will resolve itself.

"As the economy grows, as jobs get open -- not just in restaurants, but more broadly, throughout the economy -- you're going to see this work itself out. You're going to see people go back to work," says Stettner.

Federal Pandemic Unemployment Compensation means people can receive an additional $300 on top of the typical unemployment payments through September 6, 2021.

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That is down from $600 which was offered when the pandemic began.

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