Restaurant owner posts sign blaming ‘government state handouts’ for slow service amid staff shortage

A California restaurant owner has pleaded with customers to be patient with his short-staffed taqueria because ‘no one wants to work anymore’ due to government handouts.

Taco Loco in Folsom posted a slow service sign after struggling to find enough workers at the popular restaurant.

The sign reads: ‘To our loyal customers. Sadly, due to government and state handouts no one wants to work anymore. Therefore, we are short staffed.

A California restaurant owner has pleaded with customers to be patient with his short-staffed taqueria because ‘no one wants to work anymore’

‘Please be patient with our staff that did choose to come to work today to serve you.’

California’s economy fully reopened on June 15 with no limits on capacities at restaurants.

But despite the rush back to hospitality venues, many are struggling to find the staff. The government’s Covid handouts are continuing to leave people unwilling to work for less than they could be making on unemployment.

And on June 25, the California state legislature voted in favor of passing a series of extensions to unemployment payments, including extending federally-funded unemployment benefits for 20 additional weeks through September 11.

It also continued the federal addition of $300 through September 4, extended the state’s Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC) programs for 29 weeks through September 4 and added an additional $100 a week to people who qualify for regular unemployment benefits and earned self-employment income.

PUA is California’s unemployment benefits for people who don’t qualify for regular state unemployment insurance and PEUC is a benefit extension for people who already used all benefits available to them through their regular unemployment insurance claim.

John Voels, who owns a restaurant down the street from Taco Loco, says he has the same problem trying to find workers as the taqueria.

The RESET Cafe by Day owner told CBS Sacramento: ‘It’s hard to find people who want to work right now.

‘They want us to hire more people right now. We’re trying to hire more baristas, we’re trying to hire cooks. It is really hard.’

Meanwhile local resident Erica Oresky said: ‘They were laid off and they went on employment and they come back and then they get laid off again.

Taco Loco in Folsom posted a 'slow service sign' after struggling to find enough workers at the popular restaurant

Taco Loco in Folsom posted a ‘slow service sign’ after struggling to find enough workers at the popular restaurant

‘It’s a back-and-forth situation. Why not go on unemployment? It is an easy paycheck.’

It comes as fast food franchises are trying to entice workers with signing on fees and bigger salaries as they battle with the government handouts.

The combination of state and federal unemployment benefits have made it more attractive for some to stay on the sidelines during the pandemic, though the federal benefits are beginning to expire around the country.

Until then, fast food franchises are pulling out of all of the stops to push a hiring frenzy in the industry.

Wendy's is among the fast food chains offering new benefits to get employees in the door

Wendy’s is among the fast food chains offering new benefits to get employees in the door

Axios reports that one McDonald’s in Arlington, Virginia, is offering a $500 sign-on bonus for new employees.

Wendy’s is offering $100 signing and referral bonuses to new hires, in addition to same-day pay.

Chipotle is increasing the pay of restaurant workers to an average of $15 an hour.

In Ohio, White Castle has started to boost hourly pay from $11.50 to $15, according to The Columbus Dispatch.

Federal unemployment benefits are supposed to end by Labor Day across the country, but in some states, they’re ending early.

CBS New York reports that Maryland and Tennessee are among the states set to see them expire next, on July 3.

Some employers (such as this fast food chain) are offering same-day or next-day pay

A hiring sign is seen in front of a McDonald's branch, as many restaurant businesses face staffing shortages

A hiring sign is seen in front of a McDonald’s branch, as many restaurant businesses face staffing shortages

‘Everybody is trying to figure out what they need to do to get people in the door,’ president of Employment Solutions Columbus Charlie Carter said.

In April, there were 349,000 job openings in the food-services industry according to data from the Bureau of Labor Statistics leading some restaurants to raise their wages in an effort to attract workers.

Meanwhile, the unemployment rate sat at 5.8 percent in May – well above the 3.5 percent achieved by Donald Trump at the height of his presidency, just before COVID hit. The unemployment rate in California sat at 7.9percent in May.

McDonald’s said recently that it wanted to hire 10,000 employees at company-owned restaurants and would raise pay at their locations.

In March 2019, the average weekly payment to an unemployed person was $348 when combining federal and state unemployment payments. That nearly tripled to $938 in April 2020. Now they're still $638 -a-week - $300 more than they were before. It means, someone who was working 40 hours a week before the pandemic now gets nearly $16-an-hour to do nothing at home, which is more than double the federal minimum wage of $7.25

In March 2019, the average weekly payment to an unemployed person was $348 when combining federal and state unemployment payments. That nearly tripled to $938 in April 2020. Now they’re still $638 -a-week – $300 more than they were before. It means, someone who was working 40 hours a week before the pandemic now gets nearly $16-an-hour to do nothing at home, which is more than double the federal minimum wage of $7.25

Entry-level employees would earn at least $11 to $17 after the increases while supervisors would earn an hourly minimum of $15 to $20.

Non-managerial employees at company-owned stores earlier this year earned an average of nearly $12 an hour with supervisors earning $16 to $18 an hour.

Part of the reason for the ongoing labor crisis is because of the ongoing COVID-related unemployment benefits being offered by many US states – some of which pay considerably more than an entry-level job would.

Nearly 15 million people claimed some form of unemployment insurance benefits in late May, up from about 2 million before the pandemic.

In eight states, the unemployed can earn at least $600 per week in benefits. Massachusetts offers the most generous benefits

Massachusetts and Washington are the most generous states, offering those on unemployment benefits up to $850-a-week, although those handouts will end in September as the economic recovery gathers pace. California’s benefits are around $648 a week.

In March 2019, the average weekly payment to an unemployed person was $348 when combining federal and state unemployment payments.

That nearly tripled to $938 in April 2020, when Trump passed CARES – a temporary economic plan that boosted weekly unemployment payments by $600 and also gave employed people one-off stimulus checks. It expired last summer.

Now, the average weekly unemployment check is $638 – still $300 more than before the pandemic, and it’ll stay that way until September 6 at least.

It means, someone who was working 40 hours a week before the pandemic now gets nearly $16-an-hour to do nothing at home, which is more than double the federal minimum wage of $7.25.

Dozens of US states have already ended, or are in the process of ending those benefits to encourage people back to work, with the latest hold-outs set to end their COVID unemployment programs on September 4.

There may be a silver lining in sight for small businesses in California like Taco Loco because, on July 11, California reinstituted the pre-pandemic requirement that people on unemployment must actively be searching for work.

In March 2020, when pandemic lockdowns began, the federal government let states temporarily waive work search requirements for those collecting unemployment. More than half of the country had reinstituted the qualification by May and California is one of the few that kept it another two months.

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