Labor shortage poses biggest question for summer travel to Michigan as restrictions lift
The general manager of the Royal Park Hotel in Rochester was washing dishes at the hotel restaurant last week while donning a three-piece suit.
There was no one else to do the job. And the dishes were dirty.
Royal Park has turned away customers – not for lack of rooms, but because there weren’t enough people to clean them.
There are job seekers. But 70% do not show up for an interview, owner Frank Rewold said in a Michigan House committee hearing Thursday.
Demand for restaurants and travel is skyrocketing in Michigan as the pandemic subsides, but industry executives are unsure whether they have the staff to accommodate larger crowds.
âI suspect that many restaurants and hotels will close their doors over the next few months due to this situation, which has reached an extreme crisis level,â Rewold told the committee.
While everything can reopen 100% as of June 22, many business owners say they don’t even have the staff to cover 50%. Staff shortages are “by far” the biggest concern this summer, said Justin Winslow, president and CEO of the Michigan Restaurant and Lodging Association.
An MRLA survey in May found that “recruiting and retaining enough employees” was the main problem for 72% of restaurateurs. In April, this was the main problem for 57% of restaurants. In January, it was the number one problem for only 8% of restaurants.
âIf you have all the staff you are looking for and have the ability to grow 100% easily, you are the distinct minority in the restaurant industry,â said Winslow.
Despite a labor shortage, Michigan still has between 600,000 and 900,000 people claiming unemployment benefits each week. That’s about 15% of Michigan’s workforce.
RELATED: Job Search Requirements for Returning Unemployment Benefits in Michigan
Republicans and business owners want Michigan to join 25 other states in ending the federal government’s additional $ 300 weekly unemployment benefits – which are not expected to expire until September.
The State House voted in favor on Thursday, although the measure is unlikely to win governor’s approval if it were to pass the Senate.
Many also want Gov. Gretchen Whitmer to cut other federal unemployment benefits, which provide money to unemployed workers who are not eligible for state benefits.
Whitmer refused. The 25 states to be reaped the benefits are led by Republicans.
âThe problem is, people don’t want to work,â said representative Gary Eisen, R-St. Clair Township, which also owns a business. “You have to work. You have to make a house payment. You have to buy food. You have to make a car payment. And we have removed that need. The government has come and screwed it up. We have to recreate it. this need … people will want to work then, because they have to.
Many companies have increased wages in the hope of attracting workers.
John McGee, who owns five restaurants in the Traverse City area, told the Michigan House committee he had increased wages by 20 to 35 percent for an average wage of $ 23 an hour. He still has personnel issues.
At Baldwin’s Smokehouse in Saginaw, owner Roy Baldwin said the business was in “survival mode”.
âWe can’t pay the amount of money people can make by staying home and doing nothing,â Baldwin told the committee.
Signing bonuses and perfect attendance rewards are among the perks of AJ’s Walleye Lodge on Lake Gogebic on the Upper Peninsula, owner Mary Beth DeFazio said. It’s not enough, she said.
âWe just have toâ¦ create some motivation to want to go to work,â DeFazio said.
Other factors at play?
Throughout the pandemic, fear of COVID-19 has kept many people from taking jobs. But Michigan now has about 200 new cases of coronavirus per day, up from 7,000 per day in mid-April. And free vaccines are widely available.
Eliminating the remaining COVID-19 health restrictions is another signal it’s safe to work on, said Rich Studley, president and CEO of the Michigan Chamber of Commerce. He has called for an end to COVID-19 restrictions for months and believes Whitmer should cut federal unemployment benefits.
âSometimes it seems like the governor and his administration just don’t understand what it really takes to be economically competitive,â Studley said.
Immigration is a less talked about – but equally valid – part of the labor shortage, said Dave Lorenz, vice president of Travel Michigan.
Immigration limits during the Trump administration and throughout the pandemic may also have had an effect on the workforce – particularly for this summer, Lorenz said. Immigrants take on many farm jobs as well as resort jobs in places like Mackinac Island, he said.
âThey could have made it here, but not enough,â said Lorenz. “We need more of these seasonal workers to come back to provide the experience travelers want and also (fill) the jobs Americans don’t want.”
When immigration is limited, more workers opt for places like Florida – which can offer year-round hospitality jobs, instead of Michigan, where they are needed most during the summer months. Lorenz said.
Are people ready to travel?
Advance bookings for Michigan hotels have taken off in recent weeks, Lorenz said. Web traffic for Michigan travel sites is “off the charts,” he said, another indicator of a busy summer.
People can’t wait to get out after a year of restrictions. The extra disposable income and stimulus money allows many to spend more.
âIt’s coming to life,â Lorenz said. “You can tell people are absolutely ready to travel.”
Travel Michigan research shows that most people still want to stay relatively close to home, like last year. Lorenz is a bit concerned about 2022, if there is pent-up demand from residents to travel further afield or abroad.
RELATED: Hot vaxx summer and labor shortage: North braces for increased tourism
Northern Michigan was the biggest winner last summer, as many people sought out outdoor experiences away from groups of people. Industry executives are hoping the big cities can join in the success this summer, but still expect the north to be the most popular.
Last year was “one of the best summers in history” for the tourism industry in the UP, said Tom Nemacheck, executive director of the Upper Peninsula Travel and Recreation Association.
âIt was a little strange to think that we (had) an advantage with a pandemic,â Nemacheck said. âSo many people have been sick and sick and everyone is suffering from it all. But our tourism economy was in the right place with the right product. “
Executives are expecting record numbers again in 2021. The spring numbers have started off strong, Nemacheck said.
âAll of these new people are here now,â Nemacheck said. âThey tell it to others and it just goes on from there. â¦ It will pay off for us for years to come.
Yet their biggest question mark is no different from anywhere else – how to find enough workers.
âEveryone lacks help,â Nemacheck said of the UP and the United States as a whole. “They can advertise until hell freezes over, and they don’t (still) force people to come to work.”
Travelers are ready to feel like life is back to normal. While hospitality managers are excited to be up and running, they hope customers understand their situation.
âBe patient. Be kind. Tip big,â Winslow said.
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