Bloomington businesses are adjusting to labor shortage by raising wages and hiring word of mouth

More than a year after the start of the COVID-19 pandemic, businesses in Bloomington are struggling to fill shifts, hire employees and retain workers already in place.

Local businesses have been forced to adapt to this new uncertainty. Restaurants like the Village Deli have temporarily closed while businesses like Pourhouse Cafe and Darn Good Soup have had to shut down permanently.

Jeff Mease owns several businesses in Bloomington including Pizza X, Lennie’s, Bloomington Brewing Co. and Hive. Mease posted a Facebook ad on Monday detailing the changes he is making to his businesses to tackle the labor shortage. He said he changed the base pay to $ 12 an hour and provided additional pay to all restaurant staff for any work done after working 30 hours per week instead of the 40 hours required by the federal government . He said he also plans to close all Pizza X stores every Monday.

Mease said that before the pandemic, the salary and benefits he offered his employees were enough to hire and keep workers. He said that was not enough now, with companies having to raise wages and prices to deal with health and safety uncertainties from COVID-19.

“So we think $ 12 an hour is a salary that, at least for now, gets us in the game, and I expect that to increase,” Mease said.

Restaurant franchises are also struggling to hire staff. Brandon Truex, general manager of Cracker Barrel’s Bloomington, said the labor shortage their restaurant faces is no different. Franchises like Cracker Barrel cannot easily differentiate themselves from local competitors to attract applicants, as salary changes must come from their head office.

Truex said one of the only ways to attract employees is word of mouth.

“That’s kind of what we’re trying to focus on right now,” Truex said. “Whatever employees we have, we say, ‘If you have friends looking for a job, tell them to apply.’ “

IU economics professor Seth Freedman said existing worker complaints such as poor working conditions, mismanagement and especially bad wages have all been exacerbated by the pandemic, and one of the only things companies can do is offer higher wages.

“It’s possible that even coming out of the pandemic, people will remember why they thought it was a bad job,” Freedman said. “And there will be upward pressure on wages in these industries for these other reasons as well.”

Freedman also said wages that were raised during the pandemic are unlikely to drop. Raised wages will likely become the new baseline after the pandemic ends, so employers will have to adapt.

How long it will take these companies to make these changes after the pandemic is uncertain. Freedman said there are many factors that go into calculating how businesses react and how long it will take them to adjust, which is different for every business.

Mease said he sees the increase in wages in the industry as a reset. He said he believed that within a year people would start to see companies readjusting to a pay balance.

“We’re in an imbalance right now, and that’s pushing up the price of labor,” Mease said. “The price of labor will move. I think this will continue for a while.

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