Gov. Kelly, business leaders discuss how to reengage unemployed Kansans in the workforce

TOPEKA, Kan. (WIBW) - Governor Laura Kelly met with business leaders to discuss ways to reengage unemployed Kansans in the workforce during a nationwide workforce shortage.

Governor Laura Kelly says she hosted a meeting with Kansas business leaders to discuss the needs of the business community as the state continues to recover from the COVID-19 pandemic and explore solutions to address statewide workforce shortages.

“Since the start of the pandemic, I have asked for data and input from experts and stakeholders before making significant policy decisions,” Governor Kelly said. “Today’s discussion is the first of several I will hold to determine the best course of action – for businesses and for families – to reduce our state’s workforce shortages. I remain committed to supporting our businesses and workers to rebuild a healthier, stronger economy following COVID-19.”

In addition to hearing business’s concerns, Gov. Kelly said she discussed other potential factors that could have caused the shortage, including several that predate COVID-19 like low wages, socially regressive policies, health care, and childcare:

• Kansas has one of the largest shares of workers who are reliant on childcare and school. For example, in Manhattan Kansas, 27% of workers are reliant on childcare and school in order to have the ability to work.
• Many Kansans looking to reenter the workforce also have caregiving responsibilities: this recession has disproportionately affected women who largely take up these duties.
• Kansas’ April 2021 unemployment rate was nearly back to pre-pandemic lows at 3.5%.
• According to a 2017 article from “The Wichita Eagle,” Kansas’ workforce shortage issues began long before the COVID-19 pandemic entered our state.
• The Federal Reserve reports that Kansas’s labor force participation rate is currently slightly higher than it was for all of 2019, meaning that more people are working and looking for work than before the pandemic began.
• Currently, 33,000 people are receiving enhanced benefits in Kansas – but the state has 57,000 current job vacancies. If every unemployed Kansan immediately entered the workforce, there would still be job vacancies.
• An article from “The Wichita Eagle” indicates that labor allocation and wages, disruption from the pandemic, friction around types of available jobs, and the retirement of older workers are the main causes for ongoing workforce shortages, rather than extended federal unemployment benefits.
• According to an article in “The Kansas City Star,” young people in Kansas are pursuing career opportunities in other states that have embraced policies like Medicaid expansion, medical marijuana, and diversity and inclusion.
• In April, Governor Kelly and Lt. Governor David Toland heard from aviation leaders that the industry is regaining stability and is ready to hire more employees – but are facing issues finding trained, qualified workers.

According to the Kansas Chamber of Commerce, the coalition that met with Gov. Kelly represents over 8,000 Kansas businesses.

“The Kansas business community appreciated the opportunity to meet with Governor Kelly as well as Kansas Lt. Governor and Department of Commerce Secretary David Toland and Kansas Department of Labor Secretary Amber Shultz to share how government unemployment benefits are hindering businesses’ ability to fill the state’s more than 58,000 job openings,” said Kansas Chamber President and CEO Alan Cobb.

The Chamber said Missouri, Nebraska and Oklahoma are among the 24 states that have already ended their participation in the $300 additional federal unemployment benefits provided by the American Rescue Plan Act, which is set to expire Sept. 6. It said both Oklahoma and Colorado also offer one-time back-to-work bonuses.

According to the Chamber, during the meeting, National Federation of Independent Businesses Kansas State Director Dan Murray presented her the highlights from its April Monthly Jobs Report.

“The tight labor market is the biggest concern for small businesses who are competing with various factors such as supplemental unemployment benefits, government-imposed restrictions, and the virus,” said Murray. “NFIB’s April Monthly Jobs Report found many small business owners unable to fill open positions and delaying their hiring or offering higher wages. Some owners are even offering ‘show up’ bonuses for workers who agree to take the job and actually show up for work.”

The Chamber said the NFIB’s April report shows the following:

• A record 44% had job openings they could not fill.
• 59% hired or tried hiring, up three points from March.
• 31% had few qualified applicants while 23% reported none.
• 31% raised compensation while 20% plan to raise compensation in the next three months.
• 8% cited labor costs as their top business problem and 24% said that labor quality was their top business problem, the top overall concern.
• 37% have openings for skilled workers and 20% have openings for unskilled labor.

“Kansas employers shared first-hand with Governor Kelly their current struggles to fill open positions. Workforce shortages are at a critical point in Kansas, and our employers look forward to partnering with her administration to get Kansans retrained and motivated to return to work,” said KS SHRM Executive Director Natalie Bright.

The Chamber said Cobb reiterated that while the additional federal UI programs are not the only barrier for some Kansans returning to work. He said ending Kansas’ involvement in the program would spur more workers to reengage in the workforce.

“The additional unemployment benefits served a critical purpose during the COVID-19 pandemic when the government required businesses to close or reduce their operations. However, Kansas has the pandemic under control and there are ample vaccines available,” Cobb said. “While our state’s economy is on the rebound, many employers are struggling to find workers. It is one thing for businesses to compete with one another for workers. It is entirely different for businesses to compete with government.”

According to the Chamber, the business coalition will continue to work with Gov. Kelly and her administration, the Kansas Legislation and others to reengage unemployed Kansans in the workforce.

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