Frustrated Ohio Construction Co. Tries to Expand, But Runs Into Problems Hiring New Workers
Don Harrison, the owner of Harrison Construction company in Marietta, Ohio, tried to expand his booming construction business by hiring 12 new workers so that he could accept more new contracts. He explains his situation below:
"Last year the demand for our construction services, to our delight was "going through the roof," to a point where we were turning down more work than we were accepting. We were frustrated that we could not be available to the potential new clients who were calling on us and simultaneously excited that this was happening to our company. Since unemployment was in double digits, I decided we would grow, and work to sign up as much as 40% more in total contracts by hiring up to 12 additional full time employees. Basically we would take advantage of our good fortune and put a small portion of our community back to work."
But Mr. Harrison ran into some major problems hiring new workers. Reasons? Find out here.
18 Comments:
Sounds like the economy is "Losing Ground" despite the slight uptick.
looks like benefits are too high.
If Mr. Harrison can't find twelve workers who will leave the everlasting comfort of unemployment benefits then:
How will the Utica Shale be developed if 204,000 people are not available to support the efforts, in a region that includes Marietta, OH?
I am sick of all of it--the public mentions, the military pensions, the disability claims the unemployment claims.
End all of it.
No more public pensions of any kind, no more disability unless you are seriously injured, and no more unemployment comp.
Not sure that such an area would have work that generates highend UI payouts. Unlike other parts of the state, it is known more for coal and company-controlled towns than anything else. In some of the not-so-good places, it will not be surprising to see people that are on assistance long after a company has left the town.
I have no doubt that his frustration is genuine. However, he may be frustrated that he cannot get them for a certain rate that is not competitive with UI.
Driving people into desperation by merely removing said assistance makes the situation worse.
Raise the starting wage & "guarantee" the position for some period of time. UI is a form of minimum wage. Eventually, wages will be raised to attract local workers! It may be a discreet form of wage inflation!
Benjamin, if they stop taking money out of my, and my employers' pockets to fund the system, and instead require that I select a private unemployment insurance organization(which my employer may be encouraged or required to put money into), then I have no problem with that.
I also have no problem with not extending benefits after a certain time frame that represents a standard allowance for finding a new job.
I also have to wonder what the hell the benefits are in OH, since in Florida the MAX you can receive is half your normal salary, and even THAT is capped at what is about full-time minimum wage (note that you ONLY get that IF your regular job was paying at least 2x that, meaning there's a pretty hefty benefit to working instead of collecting UBs)
In other words, I'm with jorod -- what the hell are they paying in Ohio?
O Bloody--
Why not you just decide by yourself to save up money for a rainy day?
Less taxes, your pay would be higher. Set aside the higher pay into rainy day fund.
Max payout in CA is about $440 a week, but most get about one-half of that.
IMHO, people use unemployment to fund "workingman's sabbaticals."
That's fine--but let people fund their own.
The maximum appears to be $524 a week in benefits if your salary was at least $1048 a week and you have 3 or more dependents. (See http://www.odjfs.state.oh.us/forms/file.asp?id=2187&type=application/pdf)
But if you have 3 dependents, commute costs and childcare could cost more than that after payroll taxes.
Basically, this employer didn't correctly figure the minimum wage necessary to employ someone with the skills that he needs. Believe it or not, but I can't employe a computer software engineer for $13.10 an hour either. Surprisingly, no qualified applicant responds to the advertisements.
This is a case of an artificial backward bending labor supply curve. The income effect of UI benefits swamps the substitution effect. Wages would have to rise by a large amount to entice workers off of UI benefits. This observed behavior has implications for policy.
"when I called him he said he couldn't come in now because unemployment had been extended and he was making almost as much as we were planning to start him out with"
$296 a week?
btw, because massive layoffs started at the end of 2008 and continued thru early 2009, a large number of long term unemployed ran out of their rations even with the 99 week extension; in fact, more than half of the unemployed arent even getting a check anymore:
http://www.suntimes.com/news/nation/8642355-418/only-48-of-jobless-still-getting-unemployment-benefits.html
Don't forget that the unemployed and their families are also eligible for many other benefits - food stamps, Medicaid, free cell phone and minutes, and free school lunch, plus often rent subsidies, heating assistance, and other programs. The whole package adds up to much more than the weekly unemployment check.
I think there is a hefty benefit to working even at a low wage, compared to unemployment insurance.
There is also a benefit above the UI payments for not working: no child care, no commmutimg costs, no need to hire a plumber for work you could do if you just had time.
Sounds like our friend was not paying enough. That said, a cap on hi that is based on the average time it takes to find work is a good idea.
In this recession, a lot of ui might have been extended.
The whole package adds up to more........
True, but the system is predisposed to excluding people.
I once knew some people who operated a nonprofit, the purpose of which was to identify people who were eligible for assistance That they were not getting, and then to help them navigate the bureaucratic abyss.
They made a pretty good ( nonprofit) li Ingram doing this, based mainly on donations to the cause.
Somehow, I doubt that Ron or Vange were on the donors list.
If you think regs are hard to navigate running a business, try dealing with them in a foreign language, or if you cannot read, or if you are blind, have mobility issues, or mental deficiencies.
"Don't forget that the unemployed and their families are also eligible for many other benefits - food stamps, Medicaid, free cell phone and minutes, and free school lunch, plus often rent subsidies, heating assistance, and other programs. The whole package adds up to much more than the weekly unemployment check."
Well said NumberWise. The Heritage foundation added up all of the money that is spent on means tested benefits at the state and federal level. If you divide that number by the number of people in poverty, the total came out to $72,000/yr for a family of 4. More realistically, the government pays some benefits at up to 200% of poverty (up to $44,700/yr of income for family of 4). If you spread the money out over the number of people living at up to 200% of poverty, the average come out to $28,000/yr for a family of 4. These numbers do not include private charities.
Vote Democrat! It's easier than working.
>>> Why not you just decide by yourself to save up money for a rainy day?
Less taxes, your pay would be higher. Set aside the higher pay into rainy day fund.
I don't have a problem with this directly, but the real fact is, most people are probably -- especially these days -- too irresponsible to do so. All those people living "paycheck to paycheck" are not likely to do what they ought to do and invest in suitable forms of insurance -- health, employment, and old age.
I could deal with either form, but if we want to avoid the issue of "how do we deal with those who need help but haven't got 'insurance'?" without being heartless and telling them to "go howl", the best alternative is to require that such and such an amount be set aside and put into some citizen-selected form of it.
I believe the lack of personal responsibility one finds these days is certainly indicative of how many people would have no backstop without the government requiring it somehow. The problem, for the most part, is that too many people see the government as the cart and horse to drive society where we decide it should go. This is wrong. Private industry should be the cart and horse. Government should be the carrot and stick.
And yes, I do so with full acknowledgement that there should be higher limits on all the busybody crap as it is, but, if they ARE going to be #@%#^$%^ busybodies, then they should at least be allowing one to get good value for the dollars they demand put to busybody protections.
>>> Believe it or not, but I can't employe a computer software engineer for $13.10 an hour either. Surprisingly, no qualified applicant responds to the advertisements.
Can I telecommute? :-/
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