CEO favors continued federal unemployment top up but says $600 weekly amount made filling some jobs a challenge

Local

This graph shows average wages in four of the Johnson City metro’s five largest job sectors are far less than what jobless Tennesseans received while pandemic unemployment assistance was being paid.

JOHNSON CITY, Tenn. (WJHL) – A qualified customer service rep can walk into Crown Laboratories and make $16 an hour with health insurance, a 4 percent 401k match and paid time off — but nobody’s walked in yet.

“It’s a nice comp package, but we’re competing with somebody that’s staying at home and making $21 and didn’t see the end in sight, so we’ve had a little bit of difficulty filling our customer service roles,” Crown CEO Jeff Bedard said Tuesday.

Click above for a conversation with Crown Labs CEO Jeff Bedard

Bedard doesn’t criticize the $600 pandemic unemployment assistance (PUA) benefit that ended last week. Nor does he fault those who have declined job opportunities as COVID-19 persists and they gross $21.88 an hour with the PUA.

“There’s a lot of things that go into somebody’s decision to stay home and the supplement or the unemployment is just one piece,” Bedard said. “Their own personal health, the people living in their home. You know you’re not just talking about dollars and cents, you’re really talking about making decisions on somebody’s personal health and the risk that they can take.”

Bedard also said he really hopes Congress will pass an unemployment benefit extension while jobless rates remain so elevated. Still, he thinks Crown’s ability to attract workers was impacted during the PUA’s 16-week run.

“It’s hard to criticize somebody for saying I’m gonna ride this out and those jobs most likely may be there when (the PUA) goes away,” Bedard said.

“So we have had some of that, where people have debated and walked away from an opportunity to join us while the supplemental unemployment insurance is running and now we’re in a position to see truly what that impact might look like based on what Congress is going to do in the next few weeks.”

What local job sectors pay

Bedard said service industries, particularly restaurant and retail, appeared to be having even more trouble filling open positions as the PUA continued. U.S. Bureau of Labor Statistics data reveal why that’s likely.

Average hourly wages in four of the five biggest job sectors — accounting for more than 34,000 of the metro’s 77,000 jobs — were well below the PUA payment in 2019.

The average production job paid $685 a week, $190 less than the PUA’s $875. The average office/admin job paid $629 a week, the average sales job $605 a week and the average food service/food prep job just $415 a week.

“If you look at the service industry and how that’s been devastated I think we’ve got to support the folks that just don’t have an opportunity right now,” Bedard said.

“I think the best way to do it is to look at what’s the average hourly rate in a certain geographic region and sort of target the supplemental income to that so you’re not over-rewarding but you’re not under-rewarding.”

But just how many jobs are available?

A different level of federal supplement may motivate more people to search for and accept available jobs. The likelihood that enough jobs will be out there in the short term to put a huge dent in the area’s jobless numbers, though, is slim.

The latest weekly jobless report showed 13,397 people unemployed in Northeast Tennessee’s eight counties. More than 7,900 of them were in Sullivan and Washington counties.

Less than five months ago, those two counties had 566 unemployed residents between them, and recent weeks have actually seen an increase in newly filed claims.

Ongoing unemployment claims in Northeast Tennessee have only inched downward over the past couple of months.

When Crown snagged a major contract to produce hand sanitizer back in March, Bedard soon saw what a market full of newly laid off workers could mean for a company that was hiring.

PUA payments were just beginning to hit people’s bank accounts when Crown conducted a hiring blitz. Seeking to fill 52 positions, the company received more than 500 applications.

“I feel like we got some very high quality people that probably in a normal circumstance we wouldn’t have been able to attract to the company,” Bedard said. “They were probably in a position that they were happy (at their previous job), but either through furloughs or downsizing we were able to bring some people on.”

For those still in the ranks of the unemployed, Bedard said he’d advise a ready-to-go approach even as Congress debates a potential follow-up package.

“At the end of the day it’s not going to always be there and good jobs are hard to find. I would encourage people when they have the opportunity to take advantage of a job offer.

Democrats control the House and are insisting on a continuation of the $600 weekly amount through the end of the year. Republicans have floated a $200 weekly top up to state benefits (which max out at $275 in Tennessee) that would last through September to be followed by an individualized formula providing 70 percent of a person’s lost wages when combined with state benefits.

Congress is currently scheduled for a month-long recess beginning Friday and reports are that a deal is not close.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Trending Stories

Don't Miss

More Don't Miss