While “full employment” sounds like a godsend, Ventura County businesses are struggling with an unusual dilemma in today’s prosperous economic cycle — a worker shortage.
Employers have long grumbled that it’s difficult finding qualified staff but the problem has grown more intense in recent months. According to the California Employment Development Department, the county jobless rate plummeted to 3.1 percent in May, the lowest in decades, with the number of residents seeking work totaling 13,300, down from 43,800 for the same period eight years ago.
“It’s a seller’s market — the seller of labor has the advantage because there is no slack in the labor force,” said Mark Schniepp, director of the California Economic Forecast in Santa Barbara.
Economists define full employment as a jobless rate of about 5 percent, the lowest possible level before employers push up wages to compete for workers — triggering inflation. The likely chain reaction is that prices for goods or services would increase to cover higher labor costs.
Full employment doesn’t mean everyone has a job. The concept is based on a proximate measure of the economy. The official jobless rate, known as U3, also doesn’t factor in “discouraged workers” who have stopped looking because they thought there were no openings or part-time workers who want full-time positions. Under the government’s criteria, an unemployed individual doesn’t have a job, has actively looked for one in the previous four weeks and is available to work.
It’s a stretch to think that all workers have the upper hand over employers in Ventura County. People with college degrees and valuable skills certainly have an advantage. But many service and retail workers string together two or three low-paying, part-time jobs to make ends meet in a high-cost area — the county’s average rental price was $1,893 in January, according to the Dyer Sheehan Group, a Ventura housing market analyst company.
“The highest unemployment rates are for the youngest workers. They have the least experience and they might also be basic-skill-deficient,” Schniepp said. “The oldest workers have the lowest unemployment rates in the nation today.”
Full employment “episodes” are cyclical, with the last one occurring 10 to 12 years ago, he added. “There is nothing extraordinary occurring in Ventura County that is not occurring elsewhere, except for SOAR (Save Open Space and Agricultural Resources). That is preventing some organic growth and in-migrating growth of business.”
Noting that there “technically” isn’t a worker shortage, Schniepp said: “Obtaining live workers can be surmounted by offering higher wages or salaries.”
Of course, that gets back to the possibility of triggering inflation.
At the Cibara Salon in downtown Ventura, co-owner J. Alexander has had difficulty finding hair stylists and nail technicians. In the past, simply spreading the word about available salon stations would attract potential workers. “I have not seen that in the last couple of years,” Alexander said.
The business is based on renting stations — such as a chair, mirror and electrical outlet — to self-employed workers, who earn wages and tips from tourists and their regular clientele.
To compete with shopping venues like The Collection in Oxnard, Alexander is keeping his salon open to 9 p.m. most weeknights and encouraging other downtown merchants to do the same. The hope is to attract more customers, largely tourists staying at nearby hotels, as they roam downtown before or after dinner. But that also increases demand for more workers.
“We have a lot of amenities, plus we have an esthetician, a tattoo artist, spray tanning, everything,” he said. Currently operating with 20 people, the salon has openings for five or six more independent artisans.
A few blocks away on Thompson Boulevard, the Sandbox Coffeehouse recently posted a job ad on Craigslist — listed among scores of others in the food/beverage/hospitality category. Despite diligent vetting, owner Todd Ryzow admitted that the hiring process is hit or miss, which limits business expansion plans.
“Today’s generation is looking for a paycheck but not willing to put in any effort,” he said. “I’ve seen potential employees who are college educated and from good families, but they lack the work ethic.”
Because the coffeehouse features pastries, sandwiches and açai bowls, workers need to know basic safety measures when slicing carrots, onions and tomatoes. “It seems people are missing common sense,” he said, adding that it extends to customer service. “Consistency is vital. The people behind the counter are really my secret sauce.
Ryzow noted that having a reliable staff is not only critical for turning a small profit, but essential for his well-being. As a single father, there are times when he’s not at the shop, which is “unnerving” if employees aren’t reliable.
“I had an employee who was very toxic to my business — to the customers and the other employees,” he said. “But I could not let that employee go until I had the right replacement.” The worker eventurally quit, leaving Ryzow in a bind.
“It’s been very difficult for me to find workers,” he added, “but now I’m starting to build a good group of people.”