HOSPITALITY INDUSTRY REBOUNDS AS LABOR POOL WORKS TO KEEP UP
SUMMER OPTIMISM
... WITH A SIDE OF PATIENCE By Will Sinatra MassHire/North Shore Workforce Board Our thoughts turn toward lobster rolls and iced tea as summer warms the air. It’s time to go whale watching on Cape Ann, visit a museum in Salem, or enjoy a simple evening at your favorite Peabody restaurant. The hospitality industry provides us with the means to revel and make merry. This summer, however, we’ll continue to notice a difference at some of our favorite establishments — namely, longer wait times and higher prices. Inflationary forces and labor shortages continue to
impact the industry. Inflation is a problem throughout the country as fuel, food and goods continue to rise in cost. The Federal Reserve can fend off domestic inflation by slowly raising the interest rate paid on reserve balances. But is does little to control inflationary costs caused by forces outside the United States, such as the war in Ukraine and an uneven global pandemic recovery. Ukraine is a major exporter of wheat and the war has disrupted the country’s exports and current growing season. Meanwhile, India has banned all wheat exports in response to predicted wheat shortages. Both actions have inflationary effects on food costs here in the U.S., as the market responds to a limited supply. The net effect is that we see higher costs at the grocery store and restaurants.
Will Sinatra is an economic consultant for MassHire/North Shore Workforce Board. 6
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