WATAUGA — Around the nation, businesses are feeling the lingering impacts of the COVID-19 pandemic in ways other than mask ordinances and shutdowns.
A report from the White House released on June 17 noted the nation’s economy is in a time of “rapid transition,” adding jobs at a rate of 540,000 per month since January while many are making large purchases such as houses or new cars, sending sales in both sectors to their highest in more than a decade.
“While a fast pivot to growth is good news for businesses and workers, it also creates challenges,” the White House report stated. “Entire industries that shrank dramatically during the pandemic, such as the hotel and restaurant sectors, are now trying to reopen. Some businesses report that they have been unable to hire quickly enough to keep pace with their rising need for workers, leading to an all-time record 8.3 million job openings in April.”
According to a May survey from the National Federation of Independent Business — the largest small business association in the United States — 48 percent of the 659 small business polled had at least one unfilled job opening. At the same time, the NFIB reported that 57 percent of businesses searching for new hires failed to have a “qualified” candidate apply for an open position.
“It’s been a difficult scenario to work through, especially in the service industry,” Boone Chamber President and CEO David Jackson said.
The Boone Area Chamber of Commerce released a “High Country Workforce Rundown” on June 15, reporting compiled data from member businesses with information about building a game plan for the immediate future.
Both Jackson and the report noted that a commonly repeated claim was that more people were relying on unemployment money as opposed to working for their paycheck.
“It’s very convenient to cut and paste, but I don’t even believe it’s the dominant factor,” Jackson said. Both Jackson and the report said that while it is true that some are content with staying home and getting unemployment money, it is far from the only reason.
One explanation was the reduced options for child care. With many child care facilities operating at reduced capacity or summer camp options canceled entirely, some have had to take on more responsibilities at home. Others have been thrust into the role of being the primary care givers for family members.
Jackson noted the rise in entrepreneurial pursuits, which does add people to the workforce, but not into existing jobs. The report also said some businesses have not been able to reach full employment for reasons other than hiring options.
“We’ve seen some businesses not able to fully staff yet due to the unknown outcome of the tax burden left in the wake of North Carolina’s insistence on requiring taxes be paid on deductible expenses accrued by businesses related to Payroll Protection Program expenditures,” stated the High Country Workforce Rundown.
A final factor, according to Jackson, is the absence of Appalachian State University students in Watauga County.
“We have seen what App does for the business community in Boone and Watauga,” Jackson said. “When you have, potentially, 20,000 people who can get a part-time job, it fills a lot of the holes we are seeing right now.”
While labor has been hard to come by for many, some businesses are still feeling the effects of supply chain issues brought on by the pandemic. In the White House’s report, U.S. Census Bureau data highlighted what industries were being hit the hardest by supply chain disruptions.
More than 60 percent of manufacturing businesses said they were dealing with domestic supplier delays, while construction, retail trade, wholesale trade, accommodation and food services and “other services (except public administration)” all sat above 40 percent.
Nearing the 60 percent mark was construction. Watauga-based business New River Building Supplies has been feeling the pinch, with lumber supply chains having been notable in its disruption.
“It’s better than it was three months ago,” NRBS owner Perry Yates said. “It’s been very, very tight, very hard to get. But, it’s better than this time last year.”
Yates noted that prices on lumber were on the rise as recently as February and March, but have since improved due to European lumber being imported more frequently. However, businesses such as NRBS are feeling the ripple effects of other industries.
According to the White House report, the auto industry has been struggling to meet demand in large part due to supply chain issues with semiconductors.
“Expecting weak demand, (car makers) canceled orders of semiconductors, an item with a long lead time and with a secular increase in demand from other industries,” the report stated.
The subsequent demand for semiconductors from the auto industry piled onto an already in-demand product, hitting industries ranging from technology to power tools.
“The supply chain or power tools has been a challenge and it’s going to be a challenge,” Yates said.
Alongside the supply chain issues, Yates said they have also had difficulty filing open positions, specifically in the form of transport drivers.
“Sometimes, we’re having to go truck in wood ourselves because we’ve been quoted some astronomical figures for trucking,” Yates said. “We’ve had loads set that are ready to ship, but they said 14 days because we can’t get a truck.”
Yates said getting a load of wood transported previously cost $2 to $3 per mile. Recently, they’ve been quoted anywhere from $5 to $7 per mile.
“Not only is the cost of goods going up, but if you pay that and pay the freight, that’s going to make your average cost go up. From there you’ve got turn around and pass that on to the customer,” Yates said.
Jackson said the Chamber has been telling its member businesses to use different tactics if necessary, whether it is a restaurant only opening their drive-thru due to staffing shortages or make jobs more appealing for potential hires.
In the Workforce Rundown, the Chamber noted that large events on the horizon including the return of App State football weekends, festivals and ski season will bring visitors to the High Country that will hopefully boost the economy. Concerns have been raised about what happens if plans change or the weather leads to a poor tourist season and it is not the ultimate savior that some may believe.
Jackson said getting business back to their needed staffing is the first step in a full economic rebound, advising that now is the time to get one of the open positions.
“It’s essentially a buyer’s market,” Jackson said. “The message to people wanting jobs is, ‘Go get them now.’”