Lines out the door at Señor Frogs. An empty section at Joe’s Diner by the Airport. Few, if any, Lyft or Uber rides. The common thread that ties all of these together: All three problems stem from Myrtle Beach’s worker shortage.
A worker shortage? In a pandemic? How?
It’s a real issue in the Grand Strand. Dozens of restaurants, hotels, amusement parks and other businesses have “help wanted” signs outside their doors and on numerous job search websites.
Señor Frogs, a Hispanic restaurant located at Broadway at the Beach, sat half empty on Saturday afternoon even as a dozen people waited outside to get in.
“We have a line, not because we want to have a line — we have plenty of spaces,” managing partner Jerry Lomeli said. “But if we don’t do that, we collapse our kitchen.”
Myrtle Beach struggling to find workers isn’t a new problem, business owners and tourism leaders will tell you. But the coronavirus pandemic created an especially wrenching problem.
The pandemic led the Trump administration to shut off most immigration, including temporary foreign worker programs. That action cut off a crucial pipeline of nearly 3,300 international student workers South Carolina normally benefits from. For Myrtle Beach in particular, foreign labor was the lifeboat keeping the tourism industry above water as the Grand Strand became an increasingly popular vacation destination in the past 20 years, said Stephen Greene, CEO of the Myrtle Beach Hospitality Association.
Here, the local population simply can’t provide the workforce required to meet the demand of the ever-rising tide of tourists and hungry locals, Greene said.
The pandemic also forced a lot of people out of the local workforce — older individuals and immunocompromised people, for example — due to fear of contracting the coronavirus.
Then there’s the fact that the Biden administration just passed a $1.9 trillion stimulus bill that extends expanded unemployment benefits to at least September. Some businesses owners say that’s a reason they can’t find workers, accusing the federal government of giving millions of Americans a free pass to stay home and not work.
Back to the beach
A year into the global pandemic and four months into the nationwide vaccine campaign, people are ready to get out of the house and travel.
Tourists flooded Myrtle Beach hotels the last few weeks. They also strained the hospitality industry in Myrtle Beach that limped through much of the pandemic, as businesses laid off workers and cut hours to stay afloat.
However, South Carolina’s tourism industry spent most of last year gaining jobs after the initial losses in March and April as a result of the state’s early reopening and overall minimal coronavirus restrictions. Then winter arrived, and South Carolina’s hospitality and leisure industries lost 6,200 jobs in January and February, even when seasonally adjusted for usual winter workforce declines, according to the state’s Department of Employment and Workforce.
Even as statewide job losses mounted, businesses and tourism leaders knew the Grand Strand would see a worker shortage. It wasn’t a matter of if, but when.
Some hoped that the shortage wouldn’t happen until late spring or early summer. A best-case scenario would be a slowly increasing wave of tourists that could be matched by businesses slowly ratcheting up the size of their staffs, said Karen Riordan, CEO of the Myrtle Beach Area Chamber of Commerce.
That didn’t happen. Instead, the region has seen hotel occupancy jump from 39% the week of Feb. 28 to 51% the week of March 7 to 59% the week of March 14, as more and more visitors have rushed to the beach.
“We are all a little surprised that the tourism business is coming back faster than was projected, which is a good thing,” Riordan said. “No one’s complaining, but it does mean that that is making the need more keen right now.”
One of the most visible casualties of this flood of visitors is restaurant wait times. For much of the past year, many restaurant hosts would laugh if you called asking if you “needed a reservation.” Now, restaurants in high-traffic areas like Broadway at the Beach or downtown Myrtle Beach often have waits of 20 minutes or longer.
Not all of those restaurants have long waits because of a lack of empty tables, but because of a lack of staff.
Joe’s Diner by the Airport, a longtime spot for locals, has one-third of its seating closed because of the current staff shortage, owner Joe Miller said. Miller blames the federal government’s $1.9 trillion “American Rescue Plan” for why he can’t find people. He even has a sign up: “This section closed until unemployment runs out!!!”
“I don’t understand why they’re giving all that money away,” Miller said of the federal government’s expanded unemployment benefits.
Joe’s Diner doesn’t usually see a lot of tourists. The restaurant, which only serves breakfast and lunch, is primarily a spot for locals, despite its proximity to the Myrtle Beach International Airport.
Miller blames the most recent round of stimulus for why he can’t find cooks. Typically he needs four, including himself. He had additional cooks for the last several months, but one of them just left.
“We can’t even get people to apply, which is just mind-boggling,” Miller said.
In May, he’s having hip replacement surgery. If he isn’t able to find more workers by then, Miller said he’ll have to close the restaurant for up to eight weeks while he recovers.
“We don’t know what we’re going to do,” Miller said.
It’s hard to know how much the recent $1,400 stimulus checks and expanded unemployment benefits weigh into the decisions of people not returning to work. Less than one-third of the country is vaccinated, and many still fear returning to high-contact workplaces like restaurants and hotels.
Federal Reserve economist Laura Ullrich said the low wages of hospitality and leisure could make it easier for those workers to stick with unemployment.
“But,” Ullrich said, “I think it’s really difficult to know what the dominant narrative is” for why people are not reentering the workforce.
The White House has often countered the narrative that the stimulus bill is encouraging people to not work. If businesses are not paying people enough to get them to come back to work, then they should probably be paying higher wages, White House economist Jared Bernstein told the Wall Street Journal’s “The Journal” podcast.
“I think you have to distinguish between anecdote and analysis,” Bernstein told “The Journal.” So far, the administration’s studies have not shown a nationwide trend of people using stimulus money to stay home and avoid work altogether. “It is very common for employers to say, ‘I can’t find the workers I need.’ Sometimes what they’re not saying is ‘at the wages I’m willing to offer them.’”
The more clear-cut issue facing the worker shortage is the lack of international students. Thousands of them normally come to the U.S. each year on four-month J-1 visas. They come in waves depending on the timing of their school’s or country’s summer vacation. Some arrive as early as February, while others don’t get here until June.
The Trump administration halted the J-1 visa program last year, citing the risk of the travelers bringing COVID-19 to the U.S. After the country started reopening, President Donald Trump extended the ban several times, saying international workers threatened the ability of Americans to get a job during the pandemic-induced recession and skyrocketing layoffs.
Some economists and business owners, both last summer and today, say Trump’s reasoning is false, or at least misinformed, because the kind of jobs being filled by international workers are jobs Americans simply don’t want.
“The people that own businesses, they’re dying without” international workers, said Cory Wagner, who owns SunFun Vacation Rentals in Myrtle Beach and provides housing to J-1 workers. “They need them bad.”
He also said a lot of businesses asking him for help won’t pay the wages that locals want, exacerbating their worker shortage problems. “That’s the bottom line,” he said.
Señor Frogs takes on about 20 J-1 workers in a normal year. And what jobs do they take? Kitchen jobs — cooking, busing and dishwashing — that Lomeli needs to open up the rest of the restaurant. Locals, on the other hand, typically want front-of-the-house jobs like waiting tables or bartending, where they can earn more money through tips.
“It is really hard to find, sometimes, locals, and that’s what we need,” said Lomeli, the restaurant’s managing partner.
The worker shortage is so bad at Señor Frogs that the restaurant had only one person busing tables Saturday afternoon.
“Hopefully they fix this because this is very important to fix the economy because we need those employees to operate,” Lomeli said.
The ban on J-1 visas expires Wednesday, unless President Joe Biden chooses to extend it.
Even if the program gets revived, though, international workers won’t suddenly be able to fly to Myrtle Beach. Workers also need their own country’s borders and their local U.S. consulate to be open. That’s not the case for some countries, said Greene, the Hospitality Association CEO.
“There’s just so many moving parts right now to those programs that we’re just waiting to see if that presidential proclamation expires,” said Greene, who works with the State Department each year on the J-1 program in Myrtle Beach. “If it does, then we’ve got to turn and burn with the consulates and try to figure out how we can get these international students into the marketplace.”
Solution? High schoolers and retirees
Even restaurants farther inland that haven’t seen the growing throngs of tourists have found themselves overwhelmed or short staffed. Rotelli Pizza and Pasta in Conway now closes on Sundays because owner Mike Daugherty said he simply can’t find enough people to work.
Daugherty said he personally has been cooking pizzas and the restaurant has cut down on its delivery operations. He also recently hired a longtime customer, who is retired and lives nearby, to help staff the kitchen.
“The tourism isn’t what’s killing me. My business is getting flooded with (locals), and we’ve been overwhelmed,” Daugherty said. “We just have less tables because I don’t have servers to cover any more tables. … It is far, far from ideal right now, that’s for sure.”
Older retirees, many of them now vaccinated, could be a solution to the region’s longtime labor problem, the Chamber of Commerce hopes.
Riordan, the chamber’s CEO, said numerous retirees attended the chamber’s recent drive-thru job fair, many of them looking for work to stay busy or make some extra money on the side.
“That’s a great untapped labor pool for us,” Riordan said. “We’re going to go after it and reaching out specifically to our retirees and saying, ‘If you do want to work this spring, this summer, this fall, there’s quite a few seasonal part-time jobs available for you.’”
The chamber has also been looking to get high schoolers more involved in the tourism industry and plans to host a job fair through Horry County schools in mid-to-late April. There seems to be strong interest so far, Riordan said, a positive sign for the local labor market.
“We just want to jump on that quickly,” Riordan said. “We had talked to Horry County schools last year about doing that, but COVID really kind of scuttled all of those plans. So this year they were like, ‘Oh, yes, we definitely want to do it.’”
Employment measures like these could help Miller, of Joe’s Diner by the Airport, find the workers he needs to stay open.
“I’m still waiting. I’m still hoping that one person is going to come right in,” he said.