Biden says wages will need to increase to solve recruitment problems

by Morgan Chalfant - 07/21/21 10:13 PM ET

President Biden said Wednesday that businesses struggling to hire back workers amid the coronavirus pandemic will need to offer higher wages in order to solve their recruitment problems.

Biden made the comments during a CNN town hall in Cincinnati in response to a question from an audience member who works in the restaurant business.

Biden touted his $1.9 trillion coronavirus relief bill, which funded a program that provides relief to restaurants severely impacted by virus-related closures and restrictions, before suggesting that low wages could be keeping people from returning to work.

“I think it really is a matter of people deciding now that they have opportunities to do other things and where there is a shortage of employees, people are looking to make more money and to bargain. And so I think your business and the tourist business is really going to be in a bind for a little while,” Biden said.

“John, my guess is that people paying seven, eight dollars an hour plus tips, that’s I think, John, you’re going to be finding 15 bucks an hour or more now,” Biden said, addressing the audience member by name. “You may pay that already.”

The president also said that his administration is “ending all those things” that are keeping people from going back to work, seemingly referencing the expanded unemployment benefits that his administration has denied contributed to recruitment challenges.

Biden later clarified that he has seen “no evidence it had any serious impact,” but acknowledged that some have argued that the expanded benefits incentivize people to stay home.

“It’s coming to an end,” Biden said.

Republicans and organizations like the U.S. Chamber of Commerce have argued that the expanded unemployment benefits funded by Biden’s $1.9 trillion coronavirus relief law actually discouraged people from going back to work. The $300 additional federal benefit is slated to end in September. Several states have opted to end the benefits early.

However, Biden administration officials like Treasury Secretary Janet Yellen have disputed that narrative, saying the data does not show that the expanded benefits drove down employment.

At the end of what was a meandering response, Biden returned to the idea that restaurants and other businesses would need to pay people more money — he again floated the idea of $15 an hour — to work.

“If you make less than 15 bucks an hour working 40 hours a week, you’re living below the poverty level,” Biden said.

Biden has backed raising the federal minimum wage gradually to $15 an hour. Earlier this year, he signed an executive order to raise pay for federal contractors to $15 an hour.

Tags Fight for 15 Janet Yellen Joe Biden labor shortage Minimum wage