Inflation concerns

[Bootsie]

People have mentioned inflation is several threads.  I am curious about how big of a concern this is.

At what point do you think inflation becomes a concern?  Is your response based upon concerns you have about how your family will be impacted by inflation or about how you think the overall economy will be impacted by inflation?

If you think we will experience significant inflation over hte next few years, why do think that?

Edited October 18, 2021 by Bootsie

[gardenmom5]

inflation isn't an across the board thing.  Some items will skyrocket (an item I purchased last year for $121 - recently jumped to $145), other more typical price increases.   printing money to pay debt - feeds inflation.

 when told a 'rate of inflation' - they mean the average.  I still remember the inflation of the late 70s, when the prime rate for lending money hit 21.5% interest rates. It shut down industries.  it was bad.  (and dh was in banking at the time.)

[Lecka]

I answered under 4% because I have an impression 3% is considered fine.

I have an impression inflation will not get too bad once the pandemic supply issues get better over the next year or two.  
 

I don’t know a lot about it and I’m not too concerned.  I am glad I have a fixed rate mortgage with a good rate.  Edit:  I don’t think it will effect me like it would if I were renting.  Edit:  I would be concerned about rent going up if I were renting.  

Edited October 18, 2021 by Lecka

[SKL]

Let's just say I am glad I have the option to just buy less and hunker down.

I graduated high school in 1983.  I was hoping times would be better in 2024 when my kids graduate.  Right now I can't say I'm optimistic.  Gas prices have increased 50% here since the current administration took over.  And I am pretty sure taxes aren't about to go down either.

[frogger]

I started a thread at the beginning of the year about inflation but I'm still not sure exactly how to hedge my families finances against it. 

 

I don't see how the government can handle it's debt without inflation but I do believe it comes with a high cost.

I am old enough to have some savings but the majority is not in just cash so I will lose out but not as much as those who are much closer to retirement. It feel like it penalizes prudent savers. 

When it is high enough to disrupt business and supply chains it is a major problem also it seems like it could be cyclical. If people believe it will be worse in the future they will want to do their best to dump cash. 

My concern is also that the government sees high prices and wants to "fix" the problem and usually increases the prices more and produces a vicious cycle of inflation in all the things it subsidizes. I believe this is the case for things like education. It would make more sense to increase a good or service than to just shift the demand curve up through subsidies. Of course, they end up increasing the money supply out of need to cover all their bases. 

[Idalou]

6 minutes ago, SKL said:

Let's just say I am glad I have the option to just buy less and hunker down.

I graduated high school in 1983.  I was hoping times would be better in 2024 when my kids graduate.  Right now I can't say I'm optimistic.  Gas prices have increased 50% here since the current administration took over.  And I am pretty sure taxes aren't about to go down either.

I'm sure you are aware that presidents don't have much control over gas prices. It's every easy to google and read about why they do increase or decrease. But I have seen ignorant memes frequently about the cost being due to one party over the other. Same with taxes. It gets tiresome, and does nothing to further the discussion towards more meaningful ideas.

Edited October 18, 2021 by Idalou

[Bootsie]

53 minutes ago, gardenmom5 said:

 when told a 'rate of inflation' - they mean the average.  I still remember the inflation of the late 70s, when the prime rate for lending money hit 21.5% interest rates. It shut down industries.  it was bad.  (and dh was in banking at the time.)

I remember those inflation rates in the 1970s-early 1980s, also.  Over the past 80ish years, inflation has averaged about 3.5% in the US--since the turn of the century, inflation has average about 1/3 of that.  The experience of inflation (and what is "normal") I think varies quite a bit upon someone's age, sinc ethe last 20 years has been much different than the previous half-century.  

[goldberry]

3 minutes ago, Idalou said:

I'm sure you are aware that presidents don't have much control over gas prices. It's every easy to google and read about why they do increase or decrease. But I have seen ignorant memes frequently about the cost being due to one party over the other. Same with taxes. It gets tiresome, and does nothing to further the discussion towards more meaningful ideas.

I actually heard a man say that he pays no attention to politics unless the gas prices get too high. 

[kbutton]

1 hour ago, Bootsie said:

At what point do you think inflation becomes a concern?  Is your response based upon concerns you have about how your family will be impacted by inflation or about how you think the overall economy will be impacted by inflation?

I am not that well versed in economics at this point, but I do get concerned if inflation hits necessary goods particularly hard.

59 minutes ago, gardenmom5 said:

inflation isn't an across the board thing.  Some items will skyrocket (an item I purchased last year for $121 - recently jumped to $145), other more typical price increases. 

This. 

When groceries go up quickly in a short amount of time, especially when product size diminishes simultaneously, it's discouraging and makes me wonder if you suddenly plopped my DH and I into this setting early in our marriage if we'd have been able to make it financially. Rent prices boggle the mind. We were so very frugal, and we did a good job of managing our money in ways that have paid off as life gave us some beatings later on. I don't think we'd have been able to afford for my DH to finish his schooling even with loans if we were to be put in today's context, and it's not just because of the pandemic.

At the same time, we weathered the various bubbles early in our marriage when our 401k investments were a parking lot for a number of years, and gas prices went way up while DH was commuting. We bought our first home when prices were higher, but not crazy and sold when they were on the way up again (but didn't get the best deal compared to others either). 

It kind of evened out for us, but I don't know if it would if we had to do it over again with today's context. Part of this is the cost of healthcare and insurance. 

[Carol in Cal.]

Housing, insurance, and gasoline are WAY up here.  Not just a little.  And since oil prices are higher, that ripples through the prices of other consumer goods as well because of transportation costs.  

[Corraleno]

I think in the next few years we'll see higher rates than we've been used to recently, but I think it will come down from the current rate once supply chain issues are sorted out. I'm lucky to be in a position where inflation doesn't affect me very much — I don't drive much and I have a fuel efficient car; I'm vegan so price increases for meat, eggs, dairy, and fish don't affect me; I buy most pantry staples in bulk (rice, quinoa, wheat, lentils, beans, etc.) and currently have enough to last 6-12 months; prices on produce have not gone up noticeably where I shop and I have enough space to grow and can my own if prices really went nuts. The one area where inflation could really bite me is increased prices on kitchen cabinets and appliances, since my kitchen is long overdue for a remodel, but the value of my house has also increased astronomically in the last 7 years, so I feel like a kitchen remodel is still a good investment (and even if it wasn't a good investment, I really need a functional kitchen).

Edited October 18, 2021 by Corraleno
typos

[prairiewindmomma]

Do you think we're in a temporary new pattern?  I kind of wonder if what we're experiencing is somewhat new in the sense that currently a lot of Americans are cash rich, demand is high, but supply is constrained by material shortages & logistics....mostly logistics. The cash rich is also somewhat temporary if further funding doesn't occur because while household wealth is up, the wealth disparities between rich and poor also continue to increase.

Inflation is one indicator I'm keeping an eye on; I don't think any of us can understand the currently dynamic just by looking at inflation.

[73349]

I agree with PPs that what inflates more matters. The same percent increase in the cost of housing and the cost of sugar have radically different impacts on a household.

I don't think there's a certain number that's a tipping point.

[SKL]

I am also wondering about the mid-term or long-term effects of the odd combination of a weak economy and a huge number of unfilled jobs.  I keep hearing about restaurants having to cut hours, abbreviate menus, or shut down completely because nobody wants to work.  Last week, I heard our nearby pharmacy was closed during normal business hours, because it was short-staffed.  The current logistical issues are now piled on top of the labor issues, and both are on top of the increasing costs of energy, taxes, insurance, and most likely everything else.

Maybe I should invest in some canned beans.

[Pawz4me]

19 minutes ago, goldberry said:

I actually heard a man say that he pays no attention to politics unless the gas prices get too high. 

LOL. Nothing like just coming out and (essentially) saying "I'm ignorant," is there?

I probably shouldn't voice much of an opinion, as I do realize my own ignorance--I'm not particularly well informed on inflation. But I'm plenty old enough to remember the late 1970's and early '80's. It was a hard time for young folks wanting to buy homes, but man oh man did my parents benefit hugely from the interest rates that were being paid on CDs. And they had no debt/no need to take on any debt. So, yeah--they benefited. But of course others sure didn't.

 

[prairiewindmomma]

1 minute ago, SKL said:

because nobody wants to work

This language blames people for not wanting to act against their own interests.

Why would you work for an employer who offers less pay and fewer benefits compared to another employer if you're equally qualified for and slots are open for both employers?

The reality is that a number of employees retired during the pandemic.  Immigration has also been greatly constrained. The supply of workers is smaller compared to the number of jobs available.  Unemployment is 4.8%. Those I know who would like to return to working are not doing so because of childcare constraints, or other factors that they can't resolve.

It's not that no one wants to work.

[Corraleno]

21 minutes ago, SKL said:

Gas prices have increased 50% here since the current administration took over.  

There is a global supply issue right now.  Prices were low in 2020 because supply exceeded demand as travel plummeted due to the pandemic. Now people are traveling again, demand is way up and supply is down. The problem has been exacerbated by natural disasters like Hurricane Ida shutting down production in the Gulf, and severe flooding in China shutting down coal mines, thereby raising coal prices and increasing demand for oil. Skyrocketing prices for natural gas have made it financially prudent to switch to oil, further increasing demand, and OPEC and other oil producers have refused to increase production, preferring to reap higher profits. You can't blame Biden for hurricanes, floods, winter storms, and decisions by OPEC.

"Citigroup on Monday ramped up its Brent oil forecast to $85 a barrel for the fourth quarter and said crude will likely hit $90 at times. The Wall Street bank cited "price contagion this winter" and the expected switching of power plants away from sky-high natural gas to oil. Citi added that a "very cold winter" could see Europe "running out of gas" by February. Oil has long been there as a potential substitute for natural gas — except until recently, it didn't make any financial sense. That's because for much of the past dozen years, natural gas prices have been very low, making switching to oil uneconomical. But in Europe, natural gas prices have gone from below $2 per million BTU last year to as much as $55 this fall. That is the equivalent of $320 a barrel oil. Bank of America has warned that a cold winter could boost oil demand by half a million barrels per day, lifting Brent crude to $100 a barrel. That in turn would cause more sticker shock for American drivers because gas prices are priced off Brent crude. "We may just be one storm away from the next macro hurricane," Bank of America strategists wrote in a recent note to clients.

While demand is strong, oil supplies have simply not kept pace. US oil production has been slow to rebound from Covid — even as prices have surged. Many US oil companies are leery of once again oversupplying the market and they are far more focused on returning cash to shareholders who have lost gobs of money over the past decade. Despite the White House's calls for OPEC and its allies to significantly ramp up production, the group has only gradually increased output sidelined in early 2020. For now, they seem content to let oil prices remain elevated. "They have always been the swing producer," said Kpler's Smith, "but my gosh they certainly hold the power right now." Source

 

[SKL]

1 minute ago, prairiewindmomma said:

This language blames people for not wanting to act against their own interests.

Why would you work for an employer who offers less pay and fewer benefits compared to another employer if you're equally qualified for and slots are open for both employers?

The reality is that a number of employees retired during the pandemic.  Immigration has also been greatly constrained. The supply of workers is smaller compared to the number of jobs available.  Unemployment is 4.8%. Those I know who would like to return to working are not doing so because of childcare constraints, or other factors that they can't resolve.

It's not that no one wants to work.

Well nobody wants to work *at those particular jobs* is what I meant.  But we have the same problem in our businesses.  And we are not paying sweatshop wages.

This would be unimaginable at any previous time in my life.

[Arcadia]

I read in the news that inflation is here to stay until at least next year.

Gas prices were crazy when we relocated here back in 2005. We went looking for high mileage commuter cars when we bought our Corolla in 2006 so that has helped, besides always living within 10 miles of my husband’s workplace. We even check which Costco near us have the cheapest gasoline prices since we have 8 Costco’s nearby. California has the highest gas prices as usual https://gasprices.aaa.com/state-gas-price-averages/

Groceries prices has gone up so we buy more in bulk when there is sales for our favorite food items. For example, my teen’s favorite chocolate malt drink varies in price from $14.99 to $23.99 so stocking up when it’s available for $14.99 makes sense to us. 

Housing prices is crazy but we could delay buying a bigger home so it’s annoying but not frustrating.

The rates of CDs (certificates of deposits) are so low now compared to 2 years ago. Stocks that we already owned years ago are appreciating better than CDs.

[Annie G]

2 minutes ago, prairiewindmomma said:

This language blames people for not wanting to act against their own interests.

Why would you work for an employer who offers less pay and fewer benefits compared to another employer if you're equally qualified for and slots are open for both employers?

The reality is that a number of employees retired during the pandemic.  Immigration has also been greatly constrained. The supply of workers is smaller compared to the number of jobs available.  Unemployment is 4.8%. Those I know who would like to return to working are not doing so because of childcare constraints, or other factors that they can't resolve.

It's not that no one wants to work.

I also wonder how many folks stopped working second jobs because the main employer raised pay and maybe combined with child credits from the second half of the year mean folks don’t have to work two jobs to make ends meet?   

[SKL]

Energy independence - I said it then and I'll say it now.  So few people understood what a big deal it was.

[Pawz4me]

4 minutes ago, SKL said:

I am also wondering about the mid-term or long-term effects of the odd combination of a weak economy and a huge number of unfilled jobs.  I keep hearing about restaurants having to cut hours, abbreviate menus, or shut down completely because nobody wants to work.  Last week, I heard our nearby pharmacy was closed during normal business hours, because it was short-staffed.  The current logistical issues are now piled on top of the labor issues, and both are on top of the increasing costs of energy, taxes, insurance, and most likely everything else.

Maybe I should invest in some canned beans.

I don't believe that's true, although I certainly don't understand fully where the breakdown is happening, either. Of course there are plenty of higher paying jobs available at places other than restaurants. Not too many people are eager to work for a couple of bucks an hour plus the uncertainty of tips when they can get a guaranteed $15-$18 an hour at Walmart or Amazon. A local factory here is starting people out at $20/hour, no experience required, with full benefits and from what I hear lots of opportunity for advancement.

But also, weirdly -- Several times in the past few weeks someone on the local FB has complained about staffing shortages at restaurants or grocery stores, and then more than one person replies "I applied there weeks ago. Nobody has contacted me." Or "I went by and talked to the manager/assistant manager and they said they'd be in touch with me. And they haven't." After hearing that over and over it makes one wonder. The grocery store where DS works has had no trouble finding people recently.

[SKL]

2 minutes ago, Pawz4me said:

I don't believe that's true, although I certainly don't understand fully where the breakdown is happening, either. Of course there are plenty of higher paying jobs available at places other than restaurants. Not too many people are eager to work for a couple of bucks an hour plus the uncertainty of tips when they can get a guaranteed $15-$18 an hour at Walmart or Amazon. A local factory here is starting people out at $20/hour, no experience required, with full benefits and from what I hear lots of opportunity for advancement.

But also, weirdly -- Several times in the past few weeks someone on the local FB has complained about staffing shortages at restaurants or grocery stores, and then more than one person replies "I applied there weeks ago. Nobody has contacted me." Or "I went by and talked to the manager/assistant manager and they said they'd be in touch with me. And they haven't." After hearing that over and over it makes one wonder. The grocery store where DS works has had no trouble finding people recently.

Well I assure you that if I could have gotten anyone to scrub the toilets at one of our buildings in the wee hours of my daughter's birthday last week, s/he would have been paid decently!  But believe me or not ... and this is happening frequently.  Makes me think maybe I should be in the cleaning business!

[prairiewindmomma]

28 minutes ago, SKL said:

Well I assure you that if I could have gotten anyone to scrub the toilets at one of our buildings in the wee hours of my daughter's birthday last week, s/he would have been paid decently!  But believe me or not ... and this is happening frequently.  Makes me think maybe I should be in the cleaning business!

What would she have been paid? Sincerely, I want to know.

[prairiewindmomma]

Here, she would have been paid $15-19/hour, which means that she is earning well under $40,000/year, which is far less than a living wage here.

I don't think you trade places with her. That's ridiculous.

What you may actually be thinking of is owning a business in which you hire out cleaning people, whom you would pay less than a living wage.  You would be charging a much higher rate to the people hiring them, thereby earning a profit.  That's a different thing altogether.

[Bootsie]

1 hour ago, Pawz4me said:

LOL. Nothing like just coming out and (essentially) saying "I'm ignorant," is there?

I probably shouldn't voice much of an opinion, as I do realize my own ignorance--I'm not particularly well informed on inflation. But I'm plenty old enough to remember the late 1970's and early '80's. It was a hard time for young folks wanting to buy homes, but man oh man did my parents benefit hugely from the interest rates that were being paid on CDs. And they had no debt/no need to take on any debt. So, yeah--they benefited. But of course others sure didn't.

 

Unexpected inflation actually helps borrowers and hurts lenders.  When the lenders are paid back, they are being paid back with dollars that are worth less than then expected them to be worth. 

[Corraleno]

1 hour ago, SKL said:

Energy independence - I said it then and I'll say it now.  So few people understood what a big deal it was.

And the best way to do that is to focus on renewable energy sources, instead of trying to kill the wind and solar industries, subsidizing fossil fuels, and pretending that "clean coal" is an actual thing.

[Granny_Weatherwax]

I'm concerned about the cumulative effects of inflation and taxation. We are being nickel and dimed (I don't know a better phrase) to the poorhouse.

I live in a state with outrageous taxes and the answer to every problem is to increase taxes or initiate new surcharges. The new taxes are coming at alarming rates. What bothers me is that each .1%, or 3% adds up. For example, the prepared food tax and food tax (standard) on take out orders is now 10% of the total. Run by Starbucks and your order is taxed 10%.

The small taxes that seem to be innocuous aren't when they are compounded. Hotel/motel/BB/Airbnb taxes, motor fuel tax, prepared food tax (mentioned above), a secondary utility tax (on top of the taxes already paid for utilities) with the rates for electric and gas being separate and variable. Then there are the school board tax levies.

I am also concerned about my buying power. We have less to spend each month before we ever even see our paycheck as more and more of our income is dedicated to essentials or mandatory fees. Health care insurance premiums have increased. Union dues have increased. The 'insurances' and fees required in order to be able to work have increased; we didn't even have these fees when DH began his job 22 years ago. Retirement fees have increased. Home owner's insurance premiums increased dramatically over the past few years. Property taxes (state and local) have increased. Auto license plate fees have doubled. The license plate fees for campers and boat trailers went from $18 a year to $150+ a year (depending on axle weight). The state is now trying to initiate a fee based on how many miles you drive your car a year with the option of paying a flat tax rate. It has failed thus far but who knows what the future will bring. 

These are the things that concern me. Not that I'll have to pay $20 more for a new vacuum or $5 for a gallon of milk. Those are things I can deal with. I can stop dining out (which we have; although there is extreme guilt in not supporting local restaurants during the pandemic) and that keeps me from paying the Prepared food taxes and we sold our pop up so we no longer have to pay the $150 license plate fee so I do have some control, but, really, when will it stop? How many taxes/fees/surcharges will there be?

I don't understand how the average working person can do it and still save the recommended 10% for retirement, plus children's education, etc.

[fraidycat]

1 hour ago, Pawz4me said:

I don't believe that's true, although I certainly don't understand fully where the breakdown is happening, either. Of course there are plenty of higher paying jobs available at places other than restaurants. Not too many people are eager to work for a couple of bucks an hour plus the uncertainty of tips when they can get a guaranteed $15-$18 an hour at Walmart or Amazon. A local factory here is starting people out at $20/hour, no experience required, with full benefits and from what I hear lots of opportunity for advancement.

But also, weirdly -- Several times in the past few weeks someone on the local FB has complained about staffing shortages at restaurants or grocery stores, and then more than one person replies "I applied there weeks ago. Nobody has contacted me." Or "I went by and talked to the manager/assistant manager and they said they'd be in touch with me. And they haven't." After hearing that over and over it makes one wonder. The grocery store where DS works has had no trouble finding people recently.

I was just reading an article or long-form twitter thread the other day by a journalist who applied for I think it was 2 jobs/day for a month at the places where there are "because nobody wants to work, we are short-staffed" signs. They heard back from something like 3 of them for interviews, then the advertised wages were "possible after 6 -12 months of employment", but starting at way lower than stated in the help wanted ad.

I'm a little fuzzy on the details because my memory is so poor, but if I happen across it again I will share.

Edited October 18, 2021 by fraidycat

[gardenmom5]

2 hours ago, Bootsie said:

I remember those inflation rates in the 1970s-early 1980s, also.  Over the past 80ish years, inflation has averaged about 3.5% in the US--since the turn of the century, inflation has average about 1/3 of that.  The experience of inflation (and what is "normal") I think varies quite a bit upon someone's age, sinc ethe last 20 years has been much different than the previous half-century.  

I'm sorry I wasn't clear.  I meant 'average' as in "overall".  After totaling all the price increases (or decreases) across the board.  Building materials, food, gas, housing, etc. - those rates are 'averaged'.

not the average overall rate over time.

[Lucy the Valiant]

4 hours ago, SKL said:

Energy independence - I said it then and I'll say it now.  So few people understood what a big deal it was.

^ Yep. 

Home heating costs already super high and expected to go even higher this winter. 😞

[Bootsie]

5 hours ago, prairiewindmomma said:

Do you think we're in a temporary new pattern?  I kind of wonder if what we're experiencing is somewhat new in the sense that currently a lot of Americans are cash rich, demand is high, but supply is constrained by material shortages & logistics....mostly logistics. The cash rich is also somewhat temporary if further funding doesn't occur because while household wealth is up, the wealth disparities between rich and poor also continue to increase.

Inflation is one indicator I'm keeping an eye on; I don't think any of us can understand the currently dynamic just by looking at inflation.

While supply chain issues are accelerating inflation, and causing price increases in certain goods, I think the biggest contributor is the increase in the money supply.  The rate of growth of the M3 measure of the money supply was close to 25% this past year.  (The more narrow measure M1 has increased 5-five fold since the beginning of 2020!).  I do not see how you can have 25% more money (AND fewer goods and services being produced due to a global pandemic) and not have massive inflation.  The highest rates of growth in M3 in the past 60 years occurred in the 1970s--and were accompanied by high inflation.  This increase in the money supply is like none we have ever seen before.

 

[frogger]

6 hours ago, fraidycat said:

I was just reading an article or long-form twitter thread the other day by a journalist who applied for I think it was 2 jobs/day for a month at the places where there are "because nobody wants to work, we are short-staffed" signs. They heard back from something like 3 of them for interviews, then the advertised wages were "possible after 6 -12 months of employment", but starting at way lower than stated in the help wanted ad.

I'm a little fuzzy on the details because my memory is so poor, but if I happen across it again I will share.

That was not my children's experiences at all. All 4 were working and some moved to higher paying jobs even after they found a job. Another was almost poached from his employer. 

 

Makes me wonder what the heck that person put on their resume. 

[Sneezyone]

12 hours ago, Bootsie said:

People have mentioned inflation is several threads.  I am curious about how big of a concern this is.

At what point do you think inflation becomes a concern?  Is your response based upon concerns you have about how your family will be impacted by inflation or about how you think the overall economy will be impacted by inflation?

If you think we will experience significant inflation over hte next few years, why do think that?

I think it becomes a broad based concern for the economy around 4/5% but our household income is largely protected from its impacts since DHs pay is pegged to inflation and adjusted annually. I think we'll see inflation mostly because there's a lot of pent up demand for goods and services and supply chain disruptions will continue to make labor and product supplies low and unstable just as people have money to spend.

Edited October 19, 2021 by Sneezyone

[Ausmumof3]

depends on what.  A common theme here over the last few years has been that inflation is low but low income people are really struggling.  That’s because discretionary spending items were dropping in price dramatically but the basics, food, housing, electricity, fuel were escalating.  Inflation being low justifies not putting up pay rates but for those who don’t have discretionary money they were under huge pressure.

I see that in us though not to the same degree at various stages of our life. Clothes or shoes etc are ridiculously cheap and yet we can’t afford them because every last dollar is paying the mortgage and the insurance and the power bills etc.

[Condessa]

I can't really vote yet, as my opinion on how high I think U.S. inflation will be over the next few years is largely influenced by whether/how much of certain eminent proposed government spending actually goes through.  

[hippymamato3]

9 hours ago, SKL said:

Well nobody wants to work *at those particular jobs* is what I meant.  But we have the same problem in our businesses.  And we are not paying sweatshop wages.

This would be unimaginable at any previous time in my life.

What rate do you offer? Do you provide benefits? I find the situation very interesting as unemployment is very low in our state...and every place is hurting for employees. Wages are high - which is great. 

[gardenmom5]

11 hours ago, fraidycat said:

I was just reading an article or long-form twitter thread the other day by a journalist who applied for I think it was 2 jobs/day for a month at the places where there are "because nobody wants to work, we are short-staffed" signs. They heard back from something like 3 of them for interviews, then the advertised wages were "possible after 6 -12 months of employment", but starting at way lower than stated in the help wanted ad.

I'm a little fuzzy on the details because my memory is so poor, but if I happen across it again I will share.

I can understand why because businesses want people to prove they will stay.  It costs businesses money to train people to work for them - they dont' want to spend that money just for them to quit.  or not work out.  It's why there are a lot of jobs that were temp to hire.  (I recall one guy who expressed his frustration he could never make it past the temp stage.  . . . look. in. the. mirror. . . . it's you.)   If a business had someone who didn't work out- they didn't have to make them permanent and they didn't have to pay extras - which again, costs businesses money.

1ds worked at target when he was an undergrad. he started cheap - and it wasn't long he kept getting raises because he proved he'd show up,  he proved he would work, he proved he would interact well with customers, and do the job they were paying him to do.    

[DawnM]

14 hours ago, SKL said:

I am also wondering about the mid-term or long-term effects of the odd combination of a weak economy and a huge number of unfilled jobs.  I keep hearing about restaurants having to cut hours, abbreviate menus, or shut down completely because nobody wants to work.  Last week, I heard our nearby pharmacy was closed during normal business hours, because it was short-staffed.  The current logistical issues are now piled on top of the labor issues, and both are on top of the increasing costs of energy, taxes, insurance, and most likely everything else.

Maybe I should invest in some canned beans.

This made me think of the I Love Lucy episode where they invest in Can All Pet....anyone else remember that episode?

[Carrie12345]

12 hours ago, fraidycat said:

I was just reading an article or long-form twitter thread the other day by a journalist who applied for I think it was 2 jobs/day for a month at the places where there are "because nobody wants to work, we are short-staffed" signs. They heard back from something like 3 of them for interviews, then the advertised wages were "possible after 6 -12 months of employment", but starting at way lower than stated in the help wanted ad.

I'm a little fuzzy on the details because my memory is so poor, but if I happen across it again I will share.

 

6 hours ago, frogger said:

That was not my children's experiences at all. All 4 were working and some moved to higher paying jobs even after they found a job. Another was almost poached from his employer. 

 

Makes me wonder what the heck that person put on their resume. 

In MY kids’ experience, something funky has been going on for a while now.

A few years back, both dds were working in a restaurant for minimum wage. Neither ever received negative feedback/correction/discipline/whatever. Owners gushed about them to me. But their hours got cut shorter and shorter every week, while being asked not to leave. They’ve consistently begged for applicants the entire time they’ve been open while not putting employees on the schedule.

One dd worked as a medic at a camp over the summer for dirt cheap. (Not even minimum wage if you do the math, but tent accommodations and crummy food were included.) They really struggled to staff that camp, but how many people over 17 (and you HAVE TO have some adult staffing) can you really expect to  take that financial hit for a season? Dd did it as a favor and is now way behind in her financial goals. Even the experience was completely unnecessary for her professional goals.
 

Our Dunkin Donuts has had aggressively handwritten help wanted signs for over 2 years, and has a whole thankyouforyourpatiencewe’reshortstaffed sign, but not one teen I know has gotten a call. (And their service IS abysmal.)

My oldest eventually quit his previous job (sort of) because they kept telling him to come in after Covid exposures, one of which did give him Covid. And I say sort of because they actually cut contact without firing him and he said f- it. He’s moved on to another company that also ignores infectious disease, but now he’s both had Covid and been fully vaccinated at least.

On a more adult note, a company I’m closely familiar with is now having to sort out their improper use of 1099 workers. They’ve managed to remain “fully staffed” without accepting any of the responsibility.

Our local cleaning and property management companies (and we have a LOT) are swamped and no longer taking new clients. Most are not hiring new employees, they’re just sticking to the size that has kept them successful. Same for many other mobile service companies here, including my dog groomer. It isn’t financially advantageous to pay people fair wages for a marginal increase in customers, so they’re capping to the level they can handle.

There is one company that’s still hustling, but they’re dropping balls like hot potatoes because they’ve spread too thin while chasing opportunity. When you tell me to my face that you have a backlog you haven’t gotten to in one sector, and then ask me for your business in another, that’s gonna be a no for me! (Literally happened to me 2 weeks ago.)

I don’t think there are many employers (at least in the type of positions fraidycat is referring to) that approach their business as a whole ecosystem, where employer, employees, and customers need to be balanced in order to function. I do think there are some who are scapegoating and playing victim.

[Guest]

16 hours ago, Pawz4me said:

I don't believe that's true, although I certainly don't understand fully where the breakdown is happening, either. Of course there are plenty of higher paying jobs available at places other than restaurants. Not too many people are eager to work for a couple of bucks an hour plus the uncertainty of tips when they can get a guaranteed $15-$18 an hour at Walmart or Amazon. A local factory here is starting people out at $20/hour, no experience required, with full benefits and from what I hear lots of opportunity for advancement.

But also, weirdly -- Several times in the past few weeks someone on the local FB has complained about staffing shortages at restaurants or grocery stores, and then more than one person replies "I applied there weeks ago. Nobody has contacted me." Or "I went by and talked to the manager/assistant manager and they said they'd be in touch with me. And they haven't." After hearing that over and over it makes one wonder. The grocery store where DS works has had no trouble finding people recently.

This matches my anecdotal experience of one. My son applied to a fast food chain 3 weeks ago. He’s supposedly hired, but he hasn’t worked one minute yet. Everything is taking weirdly long, like he was supposed to fill out forms online but the link didn’t work. It took a week for the manager to send him a functional link. Now he’s waiting on a training schedule, but it’s just taking days upon days upon days. It’s all very strange. 

[scholastica]

16 hours ago, SKL said:

Well nobody wants to work *at those particular jobs* is what I meant.  But we have the same problem in our businesses.  And we are not paying sweatshop wages.

This would be unimaginable at any previous time in my life.

Really? If minimum wage had kept pace with inflation for the last 40 years, it would be $26/hr. So, a rate 40-50% lower than it should be seems closer to sweatshop than not to me. Especially in a high income country where prices are high.

[SKL]

9 hours ago, hippymamato3 said:

What rate do you offer? Do you provide benefits? I find the situation very interesting as unemployment is very low in our state...and every place is hurting for employees. Wages are high - which is great. 

Yeah, we offer competitive compensation for the job, and this problem is all over.  It is weird, which is why I said it would be unimaginable in any past year of my lifetime.

[Soror]

2 hours ago, Quill said:

This matches my anecdotal experience of one. My son applied to a fast food chain 3 weeks ago. He’s supposedly hired, but he hasn’t worked one minute yet. Everything is taking weirdly long, like he was supposed to fill out forms online but the link didn’t work. It took a week for the manager to send him a functional link. Now he’s waiting on a training schedule, but it’s just taking days upon days upon days. It’s all very strange. 

Ds has tried to get on several places but not ever heard back, places that continue to advertise they have openings. He has had a great track record at McDonald's. He isn't late and shows up unless he is rarely sick (or when he was quarantined). He works hard. He is a bright student and has his Eagle Scout and Black Belt in TKD (which should show a good work ethic).

He has worked at McDonald's since he turned 16 because they got back to him right away and treat him well. We made him quit for awhile (he gave 2 weeks notice) and thought he'd try some place new when summer came. He got a job at Little Caesar's, the first day the guy told him he can work him 12 hours with no breaks as it is perfectly legal here (and I couldn't find any law saying he was wrong- go us). Ok. Whatever. The second day he packed a sandwich, as I told him to see if they'd let him just have 5 minutes to eat during a slow period. He asked one of the managers when it was dead if he could sit and eat a sandwich and she said it was fine. The owner came back and told him he didn't think he was dedicated enough. Workers should spend every minute cleaning or working, no breaks at all for any shifts. So, he called McDonald's and got back on with them. When he gave his 2 weeks to Little Caesar's the owner told him that he was going to fire him anyway, he can go ahead and leave. My brother went by this location a few weeks back. He didn't see anyone there so he was getting ready to leave and as he did the owner pulls up and gives a sob story about how he can't get anyone to work for him.  Another restaurant in town is advertising that they can't get workers so have had to reduce hours. This same place was in the news because the owner was sexually harassing employees. It is now supposed to be under new owners but I've got to say I'd be skittish about sending my kid there.

[SKL]

2 hours ago, scholastica said:

Really? If minimum wage had kept pace with inflation for the last 40 years, it would be $26/hr. So, a rate 40-50% lower than it should be seems closer to sweatshop than not to me. Especially in a high income country where prices are high.

Well you don't know what we pay or how else we accommodate people, so whatever.

Like I said, I can pretty much sit and watch it happen.  I feel the young people are making mistakes that will follow them throughout their lives, because they have unrealistic ideas of what is fair and how much one needs to invest in one's future.  But time will tell.

[Sneezyone]

3 hours ago, Quill said:

This matches my anecdotal experience of one. My son applied to a fast food chain 3 weeks ago. He’s supposedly hired, but he hasn’t worked one minute yet. Everything is taking weirdly long, like he was supposed to fill out forms online but the link didn’t work. It took a week for the manager to send him a functional link. Now he’s waiting on a training schedule, but it’s just taking days upon days upon days. It’s all very strange. 

DD is experiencing this with her most recent hire. She’s had to call them and follow up. There’s still no report date set or training scheduled or new hire packet for her to complete (major grocery chain). Most of her friends have worked, are working, or are looking.

Edited October 19, 2021 by Sneezyone

[prairiewindmomma]

10 minutes ago, Soror said:

Ds has tried to get on several places but not ever heard back, places that continue to advertise they have openings.

My ds has had similar experiences with hiring.  Nobody here really hires under 18s either, so they aren't accessing the teen labor pool.

My son works hard, has never been sick, and has never been late. He's with a decent employer now (union job) but he still struggles with having his hours cut (and thus not having expected, reliable income) or with having hours added on to the schedule with no notice. Wages for similar jobs all moved up a few dollars an hour this summer in our community, but he and others haven't gotten a raise, so a lot of his coworkers are leaving for those better paying jobs to follow the money. Why work for $15/hr when you can get $20? Even with working just 20 hours a week, that's almost another $400/month.

I don't believe the "young people are making bad decisions that will ruin their entire future lives because they don't know what is fair" line. I don't believe it at all. They are acting in their own self interests as rational players in the labor market. Look at the nursing shortage right now. Nurses are quitting established jobs at hospitals and then going to work as travelers because pay is 3-5x higher than their previous salaries. Some are even getting rehired 3-6 months later back at their previous hospital jobs as travelers (with the exponential pay increase). They are taking calculated risks because it's almost always to their benefit to do so, even though traveling contracts are, by nature, short term. The tradeoff is worth it. Certain areas of the tech industry are also experiencing similar labor crunches.  There was a position dh's work had tried to fill for two years. A headhunter for the company finally found a qualified candidate with a good personality match. He refused to relocate, and demanded an eyewatering salary, well above what was advertised.  He got what he wanted because there are few talented and capable people in that niche area of what he does. 

I think in some areas the coin has flipped--businesses are limiting hours because the marginal increase in sales from having extended hours doesn't match the increased salary costs they would have to cover by staffing those hours OR they are having to pay a bit more in salary in order to cover those business hours (but in makes business sense to do so).

I will say it's dang annoying that nearly every place around me now has different store hours than they used to.  My local pharmacy is no longer open on Sundays, and whereas before they were open 9-9, they are now open 9-6.  It makes it hard for working families to fill prescriptions.  The drive through lines are now rarely less than an hour wait for pickup.

 

[Bootsie]

3 hours ago, scholastica said:

Really? If minimum wage had kept pace with inflation for the last 40 years, it would be $26/hr. So, a rate 40-50% lower than it should be seems closer to sweatshop than not to me. Especially in a high income country where prices are high.

This makes an assumption that the rate 40 years ago was the rate it should be.  I don't know that there is any basis for that.  If we picked other past time periods and adjusted time periods and used the same logic we would come up with different rates.  And if you use that same logic, not only would the price of labor be much higher, the price of gasoline and some other items we purchase would be much higher. 

[Bootsie]

5 hours ago, scholastica said:

Really? If minimum wage had kept pace with inflation for the last 40 years, it would be $26/hr. So, a rate 40-50% lower than it should be seems closer to sweatshop than not to me. Especially in a high income country where prices are high.

I am curious how you got the $26/ hour number.  The minimum wage was $3.25 in Jan 1981--if it was $26/hr 40 years later, that would be an annual increase of 5.3% Inflation has not averaged anywhere near 5.3% over the past 40 years--it has averaged less than 3%.  

[fraidycat]

8 hours ago, gardenmom5 said:

I can understand why because businesses want people to prove they will stay.  It costs businesses money to train people to work for them - they dont' want to spend that money just for them to quit.

And employees want businesses to prove they will pay what they advertised the wage to be.

I just started a part time job in August. They advertised the job/wage at $22/hour. If they had given me a job offer at $12 an hour and said that the $22 is actually a supervisor wage "actually that is up to what is possible, IF I stayed for a year and was chosen as a supervisor", I would have laughed in their faces and told them to shove it. Deceptive is deceptive, but that is what is happening many places.

They DID pay me only minimum wage for the 3.5 days of training, but that was discussed and agreed upon in the contract. But it was 3.5 days, not 12 months.

I also know my schedule more than a month in advance and it is consistent so I can plan my life accordingly.