Hospitality operators call for state to pay bonus to entice people back to work

Sonoma County restaurants and hotels that are struggling to find employees want the state to use part of California’s $75 billion budget surplus to pay a bonus to entice people back to work now that pandemic restrictions are easing.

Hospitality businesses, a key pillar in Sonoma County’s agriculture- and tourism-dependent economy, are engaged in fierce competition to fill numerous job openings, with the clock ticking as California approaches a broad June 15 reopening.

The staffing crunch has stymied hospitality operators at the most inopportune time, as the state and county get set to lift public health restrictions that have been in place for more than a year. The Press Democrat just detailed the desperate plight of the depleted hospitality sector in an in-depth report.

Industry operators want the state to help restaurants and hoteliers hire much-needed workers by rewarding people with a return-to-work bonus. Also, certain food service managers suggested that enhanced unemployment benefits — $300 extra a week until September for a maximum monthly jobless payment of $3,000 in this state — are working against them by deterring people from the workplace.

Percy Brandon, general manager of Vintners Resort in Santa Rosa, would like to see California pay unemployed residents to return to the job, which could help people with children cover a portion of child care expenses.

“There’s no encouragement to go back to work,’’ said Brandon, who is scrambling to double his 100-person payroll at the luxury Wine Country property. ”There should be a bonus for returning to work rather than staying home.“

State Sens. Mike McGuire, D-Healdsburg, and Bill Dodd, D-Napa, who represent parts of Sonoma County, both said such a financial incentive is worth consideration. McGuire said state lawmakers, who are mulling how to spend part of the outsized surplus to revive the ravaged economy, already are looking at it. Dodd said he plans to “advance” the matter to Gov. Gavin Newsom’s office.

But Robert Eyler, a Sonoma State University economist who tracks the county’s labor market, called a financial inducement to lure people back to work “a gimmicky fix.”

“Anecdotes suggest that there are people making choices based on the continuation of unemployment benefits and that the labor market is not changing enough yet to make that choice to walk away from them,” Eyler said.

A few local hospitality operators interviewed said they know of cases in which bolstered jobless benefits are keeping people at home without jobs. They stopped short of saying they know individuals who are taking advantage of the government’s financial boost meant to give more money to those still suffering pandemic-related hardships and can’t land jobs.

“If a $300 federal unemployment benefit is causing people to stay away … then obviously wages are too low,” said Jack Buckhorn, executive director of the North Bay Labor Council. He noted some people have lingering concerns over public health risks and safety protocols in workplaces.

With the yearlong pandemic fading nationwide, there’s been preemptive action by at least 22 states led by Republican governors — Texas being the largest of them — to declare they are opting out of the $300 weekly federal unemployment supplement program months early in June or July. Last year, those laid off as COVID-19 raged were eligible for an additional $600 a week until the end of July 2020. In December, Congress restarted the weekly jobless bonuses, at half the previous amount.

Dodd said he thinks California lawmakers should “discuss” the issue which has become contentious in many areas in the country.

“It’s a balancing act,” he said, of wanting people to return when their employers call them back to work and making sure “we don’t put people in jeopardy who deserve these benefits because their jobs aren’t coming back anytime soon.”

McGuire said he “would not support” California joining 20-plus other states in soon ending the temporary increase in unemployment benefits. The state’s residents earning the lowest wages have “taken the brunt of the pandemic,” the senator said, adding that those struggling before the onset of the coronavirus last spring now have “more acute” financial troubles.

As states recently began announcing plans to cancel the federal jobless aid, President Joe Biden reaffirmed that Americans remaining idle when they have job options is not allowed.

“We're going to make it clear that anyone collecting unemployment who is offered a suitable job must take the job or lose their unemployment benefits,” Biden said. “That's the law.”

The U.S. Chamber of Commerce has joined governors in GOP-led states to end the weekly supplemental benefits calling them too generous and saying they are slowing the economic recovery, creating a disincentive to work and contributing to labor shortages in many industries.

Peter Rumble, chief executive of the Santa Rosa Metro Chamber, said “it would be a bad idea in California” to stop extra jobless payments, for the state’s nearly 3 million residents still unemployed.

Staff Writer Bill Swindell contributed to this report.