One Buffalo, New York, area Starbucks coffee shop has claimed the title of being the first in the country to unionize. This result has put a large amount of pressure on the national chain that has already been suffering from the current labor market shortages.
As reported by The New York Times:
Workers at one Buffalo-area Starbucks store have voted to form a union, according to results announced by the National Labor Relations Board on Thursday. Workers at a second store in the area voted against unionizing, according to the board, though a union lawyer contended that some ballots had been delivered to the agency and not counted. The union was leading in an election at a third store, but by a margin smaller than the number of ballots that were being challenged by the union. The challenges must be resolved by the agency’s regional director in the coming days or weeks before there is a result.
The build-up of these unionization efforts over the past few months have put a large amount of pressure and stress on the company leadership:
Starbucks responded to the union campaign with a sense of urgency. Throughout the fall, out-of-town managers and executives — even the company’s president of retail for North America — converged on stores in Buffalo, where they questioned employees about operational challenges and assisted in menial tasks like cleaning bathrooms…
Several workers who support the union said they found the presence of these officials intimidating and, at times, surreal. They also complained that Starbucks had temporarily closed certain stores in the area, which they found disruptive, and said Starbucks had excessively added staff in at least one of the three stores that held elections. The workers said this had diluted support for unionization at the store.
Most of the workers who were in favor of unionization stated that their reasoning for their vote was the severe understaffing and bizarrely poor training, which is a problem that has been infecting almost every labor-intensive industry across the country. As revealed in the Department of Labor’s most recent Job Openings and Labor Turnover Survey (JOLTS), which crunched the data from this past October, there are just over 11 million potential job openings across the United States, which far exceeds the number of people actively looking for work by an almost staggering 3.6 million.
To attempt to combat these ongoing labor shortages, Starbucks has begun looking into, and formally testing, a new cashier-less coffee shop located in Manhattan which has been enabled by Amazon’s “Just Walk Out” technology.
“We designed this experience to fit people’s needs as they go about their day,” stated Dilip Kumar, the Amazon physical retail vice president. “Sometimes you’re in a hurry, some days you have more time.”
Quite a few people are pointing to the ongoing federal stimulus programs as a main contributing factor to the increasingly low labor market participation. As part of an interview with the Ranking Member of the House Ways and Means Committee, Rep. Kevin Brady (R-TX), it was the Child Tax Credits program that was implicated as an issue for this.
“For the first time, it is divorced from work. That’s not a requirement for getting it, and so you’re seeing this barrier begin to impact businesses starting last week,” stated Brady. “I think the point here is that the federal government is sending a seemingly never-ending supply of checks, regardless of whether you work or not. You’re going to have economic problems, and that’s what we’re seeing.”
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