If anyone wonders what effect a Universal Basic Income would have on the economy, one need only order some Buffalo wings.
The bill will come with a sticker shock, thanks to the current chicken shortage in the U.S.
As the Wall Street Journal reported, the limited supply and subsequent price hike is a result of labor shortages that have been seen across industries since the U.S. economy began reopening. Chicken suppliers are struggling to get enough workers to keep up with demand.
And it’s not just those who keep America in tenders and nuggets that are having a hard time finding workers.
As Business Insider reported, weekly jobless claims are at a pandemic-era low, but businesses, particularly in the restaurant and service industries, are still struggling to hire.
Taco Bell is looking to fill thousands of open roles and is interviewing candidates en masse in parking lots, while McDonald’s has cited a labor shortage in saying that some dining rooms may not reopen this year, Reuters reported earlier this month.
Persistent fear of COVID-19 has been cited as one factor keeping people from applying for jobs, but another major disincentive to work are unemployment benefits.
At the height of the pandemic last year, when millions of Americans were filing for unemployment, passage of the CARES Act provided an extra $600 in weekly unemployment benefits for those who lost their jobs.
It made sense — businesses were shuttered, the economy was cratering, and families struggled to get by.
The benefits were extended through the year, and even now, as the economy is reopening and enjoying a growth spurt, President Joe Biden’s $1.9 trillion stimulus plan includes weekly $300 unemployment benefits through Sept. 6.
Businesses are opening their stores, jobs are available, and yet many employers are dangling signing bonus to attract applicants.
As the New York Times reported, some experts have argued that these benefits might actually discourage unemployed workers from returning to the labor force.
Toby Malara, government affairs counsel at the American Staffing Association, told Insider in February, “We began to see that some employees were in a position where they were literally making four, five sometimes $6 an hour more on UI (unemployment insurance) with the pandemic bonus. It did not make sense for them to go back to work.”
This should be a cautionary tale, an object lesson in unintended consequences.
However, with progressives such as Rep. Alexandria Ocasio-Cortez and New York City mayoral candidate Andrew Yang as proponents, the UBI discussion is here to stay.
And if enhanced unemployment benefits are helping stoke a paucity of potential employees willing to get back to work, what are the chances a guaranteed income won’t do the same?
A Universal Basic Income would provide monthly funds, regardless of circumstances or need. According to Forbes, proponents calculated from government statistics to show that a generous stipend of $3,000 a month for each adult in the country would cut the nation’s poverty rate in half.
Processing chicken for $17 an hour hardly makes sense in comparison.
The extra $300 in unemployment benefits ends in September. There will, of course, be progressive cries to keep the deal going.
Here’s hoping lawmakers are learning from this labor shortage and its causes and resolve to get America back to work.
