Franchise Brands Experience Challenges Rehiring Workers During the Pandemic

The devastating effects in the country from the COVID-19 global pandemic is of no surprise. While the nation moves towards a healthier atmosphere with vaccination rollouts, some effects of the pandemic are still lingering, prolonging the crisis. Particularly, businesses across the country, including many franchise brands, continue to face challenges hiring workers during the pandemic.

In a recent survey conducted with over 30 franchise brands, IFA found that around 60% businesses are still struggling to rehire workers.

Some brands have tackled the issue by raising wages and providing other incentives to encourage workers to return to work, but even such measures have proven to be unsuccessful.

“Urban Air franchisees are executing aggressive advertising campaigns for new team members, funding new team member referral programs, new team member sign on bonus programs, and gifting team members with free family playtime in our parks, among other strategies to recruit new team members,” said Josh Wall, Chief Franchise Officer of UrbanAir Adventure Parks. “We know the labor market is competitive. It should be. But currently we are competing with a labor market that is being directly incentivized by our government to not work. This feels wrong for our culture and unAmerican.”

President Biden’s recently enacted American Recue Plan included a $300 weekly boost in unemployment benefits, extending pandemic aid until September 6th. While providing generous and long-lasting jobless benefits was a critical step in providing relief to many Americans, its extension is clearly impacting businesses and delaying economic recovery.

Some Congressional leaders are taking measures to combat the rising demand for labor. On April 27th Sens. Mike Crapo (R-ID) and Jim Risch (R-ID) introduced the Back to Work Bonus Act. The bipartisan bill aims at helping small businesses rebuild their workforce quickly by turning these unemployment benefits into a back-to-work bonus that will provide a bump to workers and help accelerate the economic recovery. Rep. Kevin Brady (R-TX) introduced the House version – Reopening America by Supporting Workers and Businesses Act of 2020 – earlier last month.

IFA released a statement in support of the bill:

“Franchises of restaurants, hotels, salons, gyms, commercial and residential services, and health care are increasingly facing labor shortages as the economy reopens and demand for their products and services return. According to a recent IFA survey, more than 60 percent of franchise brands and local owners cannot find the labor to meet current demand despite offering increased wages and hiring incentives. Franchise small businesses will create nearly 800,000 jobs this year, but only if policies are in place to help both business owners and employees get back to work. The Back to Work Bonus Act will help make those forecasts a reality, aiding IFA members in providing dignified, meaningful, and safe jobs for anyone who feels comfortable and ready to re-enter the workforce.”

We are hopeful that with the current public health state-of-play combined with vaccination rollouts, our country’s health and safety can be secured soon. However, as we come together to defeat one crisis, let’s not employ another catastrophe of keeping American labor at bay.