    [Joint House and Senate Hearing, 117 Congress]
    [From the U.S. Government Publishing Office]

                                                          S. Hrg. 117-144

                            HELP WANTED: A STRONGER
                         LABOR MARKET FOR ROBUST GROWTH

    =======================================================================

                                    HEARING

                                   BEFORE THE

                            JOINT ECONOMIC COMMITTEE

                                     OF THE

                         CONGRESS OF THE UNITED STATES

                        ONE HUNDRED SEVENTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 27, 2021

                                   __________

              Printed for the use of the Joint Economic Committee

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

            Available via the World Wide Web: http://www.govinfo.gov

                                   __________

                        U.S. GOVERNMENT PUBLISHING OFFICE
    46-616                     WASHINGTON : 2022

    -----------------------------------------------------------------------------------

                            JOINT ECONOMIC COMMITTEE

        [Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress]

    HOUSE OF REPRESENTATIVES             SENATE
    Donald S. Beyer Jr., Virginia,       Martin Heinrich, New Mexico, Vice
        Chairman                             Chairman
    David Trone, Maryland                Amy Klobuchar, Minnesota
    Joyce Beatty, Ohio                   Margaret Wood Hassan, New
    Mark Pocan, Wisconsin                    Hampshire
    Scott Peters, California             Mark Kelly, Arizona
    Sharice L. Davids, Kansas            Raphael G. Warnock, Georgia
    David Schweikert, Arizona            Mike Lee, Utah, Ranking Member
    Jaime Herrera Beutler, Washington    Tom Cotton, Arkansas
    Jodey C. Arrington, Texas            Rob Portman, Ohio
    Ron Estes, Kansas                    Bill Cassidy, M.D., Louisiana
                                         Ted Cruz, Texas

                      Tamara L. Fucile, Executive Director
                Vanessa Brown Calder, Republican Staff Director
                      Colleen J. Healy, Financial Director

                               C O N T E N T S

                                  ----------

                         Opening Statements of Members

                                                                       Page
    Hon. Donald Beyer Jr., Chairman, a U.S. Representative from the
      Commonwealth of Virginia.......................................     1
    Hon. Mike Lee, Ranking Member, a U.S. Senator from Utah..........     3

                                   Witnesses

    Dr. Betsey Stevenson, Professor of Economics and Public Policy,
      Gerald R. Ford School of Public Policy, University of Michigan,
      Ann Arbor, MI..................................................     6
    Mr. Skanda Amarnath, Executive Director, Employ America,
      Washington, DC.................................................     7
    Mr. Daniel Swenson-Klatt, Owner, Butter Bakery Cafe, Minneapolis,
      MN.............................................................     9
    Ms. Rachel Greszler, Research Fellow in Economics, Budgets and
      Entitlements, The Heritage Foundation, Washington, DC..........    11

                           Submissions for the Record

    Prepared statement of Hon. Donald Beyer Jr., Chairman, a U.S.
      Representative from the Commonwealth of Virginia...............    38
    Prepared statement of Hon. Mike Lee, Ranking Member, a U.S.
      Senator from Utah..............................................    39
    Prepared statement of Dr. Betsey Stevenson, Professor of
      Economics and Public Policy, Gerald R. Ford School of Public
      Policy, University of Michigan, Ann Arbor, MI..................    40
    Prepared statement of Mr. Skanda Amarnath, Executive Director,
      Employ America, Washington, DC.................................    52
    Prepared statement of Mr. Daniel Swenson-Klatt, Owner, Butter
      Bakery Cafe, Minneapolis, MN...................................    59
    Prepared statement of Ms. Rachel Greszler, Research Fellow in
      Economics, Budgets and Entitlements, The Heritage Foundation,
      Washington, DC.................................................    63
    Articles submitted by Representative Schweikert with associated
      links..........................................................    81
        ``The Anti-Poverty, Targeting, and Labor Supply Effects of
          the Proposed Child Tax Credit Expansion''
        ``Which States Are Driving U.S. Employment Growth?''
    Prepared statement for the record submitted by Senator Klobuchar.    81

                            HELP WANTED: A STRONGER
                         LABOR MARKET FOR ROBUST GROWTH

                                  ----------

                          WEDNESDAY, OCTOBER 27, 2021

                        United States Congress,
                              Joint Economic Committee,
                                                        Washington, DC.
        The hearing was convened, pursuant to notice, at 3:01 p.m.,
    in Room 210, Cannon House Office Building, Hon. Donald S. Beyer
    Jr., Chairman, presiding.
        Representatives present: Beyer, Beatty, Pocan, Peters,
    Schweikert, Herrera Beutler, Arrington, and Estes.
        Senators present: Heinrich, Kelly, Warnock, and Lee.
        Staff present: Vanessa Brown Calder, Jackie Benson, Carly
    Eckstrom, Tamara Fucile, Sean Gogolin, Devin Gould, Erica
    Handloff, Colleen Healy, Liz Hipple, Adam Michel, Alexander
    Schunk, Sydney Thomas, and Emily Volk.

     OPENING STATEMENT OF HON. DONALD BEYER JR., CHAIRMAN, A U.S.
            REPRESENTATIVE FROM THE COMMONWEALTH OF VIRGINIA

        Chairman Beyer. So this hearing will come to order. I would
    like to welcome everyone to the Joint Economic Committee's
    hearing, entitled ``Help Wanted: A Stronger Labor Market for
    Robust Growth.''
        I want to thank each of our truly distinguished witnesses
    for sharing their expertise today, and now I will do an opening
    statement before turning to Senator Lee for his.
        One of the most important things we can do as a Congress is
    to help build a policy environment that encourages the creation
    of well-paying, high-quality, safe jobs, jobs that allow
    Americans to support themselves and their families, to create
    opportunities that provide workers with both a steady paycheck
    and the ability to care for loved ones when they are in need.
    Ensuring workers can navigate care and work responsibilities is
    crucial to boosting overall productivity and advancing long-
    term and robust economic growth, which benefits us all.
        The purpose of this hearing is to examine the barriers to
    labor force participation. Why is it that certain workers have
    been unable to rejoin the workforce? How can policymakers help
    address this trend? And, despite the strength of the Nation's
    ongoing recovery, which the pace of new jobs created has been
    steady with almost 5 million Americans returning to work under
    President Biden--I believe the most in the first 10 months of
    any Presidency--the uneven return of the workforce we are
    witnessing really raises some concerns. It is particularly
    troublesome that women comprise nearly two to three workers who
    have dropped out of the labor force since the beginning of the
    pandemic.
        To understand the current situation, it is useful to look
    at preexisting trends in U.S. labor force participation. After
    increasing dramatically over the second half of the 20th
    century, women's labor force participation peaked in 2000 and
    has been declining since then. The reason for much of this
    decline has been the lack of structural support for women's
    full participation in the economy, such as paid leave and
    affordable and accessible childcare.
        The pandemic highlighted these underlying structural
    changes confronting our care infrastructure. Women remain the
    members of the family most often responsible for the greater
    share of care work. And now facing the burden of inadequate and
    unaffordable childcare, the impossible choice between caring
    for a sick loved one or getting a paycheck or pandemic-related
    disruptions of schools, many women have been unable to return
    to the workplace. So, if we don't take action to better support
    women who are returning to work, we may experience prolonged
    periods of worker shortages that will hurt our Nation's
    economy.
        As a small business owner for over four decades--I was just
    bragging that our family business was 48 years old last
    Saturday--I have seen firsthand how paid leave is important for
    supporting both small businesses and workers. It is inevitable
    that workers need to take time off to care for themselves or
    for a loved one, but only 23 percent of American workers have
    access to paid family leave.
        Unfortunately, the lower wage workers, the ones who are
    least able to take time away from work to care for a sick child
    or a relative, they are also the workers least likely to get
    paid leave from their employer. The universal paid leave
    program would allow parents to look for work with the knowledge
    that they can care for their kids without losing their
    paychecks. It would also allow employers to be able to retain
    experienced workers who need to take leave without having to
    pay them leave out of their own pocket, their employer pocket.
        The good news we can take from the current strong demand
    for workers is that we know from the recent past that, when
    there is strong demand, they do return to the labor force.
    Under President Obama, the U.S. began the longest period of
    continuous job growth in modern history. And the tightening of
    the labor market created opportunities for millions of
    previously marginalized workers to rejoin the workforce, drive
    up wages, particularly among low-wage work earners.
        So, while the coronavirus pandemic rocked the labor market,
    pushed the labor participation rate to lows we haven't seen in
    decades, the hot labor market before the coronavirus pandemic
    demonstrated that sidelined workers can be brought back into
    the labor force. And this offers us a useful example as we look
    to address the current challenges facing workers.
        But as helpful as strong demand for workers can be in
    pulling back--people back into the labor force, we have seen
    that if we want to make meaningful improvements in labor force
    participation, we must address these gaps, existing gaps, in
    workforce supports that help workers navigate both jobs and
    care responsibilities.
        Workers have made significant progress in the past year.
    Under President Biden, the unemployment rate has dropped to 4.8
    percent in September, 4 percent in Virginia, beating
    expectations. Nevertheless, as we see in many different ways,
    including supply chain disruptions, there is significant
    turbulence in the labor market. And it is incumbent on this
    Congress and on the Joint Economic Committee to examine and act
    on policies that make it possible for Americans to maintain
    their work responsibilities while ensuring for the well-being
    of their loved ones.
        So I am looking forward to learning from each of the
    witnesses today. And I am happy to introduce the vice chair of
    the committee, Senator Lee from Utah.
        [The prepared statement of Chairman Beyer appears in the
    Submissions for the Record on page 38.]

      OPENING STATEMENT OF HON. MIKE LEE, RANKING MEMBER, A U.S.
                           SENATOR FROM UTAH

        Senator Lee. Thank you very much, Mr.Chairman. I look
    forward to today's hearing.
        Throughout the history of our great country, Americans have
    worked to build businesses and employ workers and support
    families in the process. Through work, we have developed new
    ideas that have bettered our own lives and the lives of our
    neighbors, our communities, and our entire country. When work
    is no longer a part of our lives, we lose something fundamental
    to our ability to contribute and to thrive. Work is more than
    just a source of income. Work connects us with each other, and
    it connects us with a purpose that is greater than ourselves.
        But today work is in a state of crisis in America. Millions
    of Americans have fallen out of the workforce since the onset
    of the COVID pandemic. Workers are quitting their jobs at
    unprecedented rates, and labor unions are striking as demand
    for labor continues to grow.
        September's job report shows the smallest gain in payrolls
    this year, and nearly five million Americans are still on the
    sidelines. Across the country, there are more jobs than there
    are willing workers. The current employment situation should
    concern all of us, but declines in labor force attachment
    actually precede the pandemic.
        In a new report this week, the Joint Economic Committee
    Republicans evaluate the years-long question of why so many
    prime-age, able-bodied Americans have fallen out of the
    workforce. For men, connections to work have been declining for
    decades and hit a record low last year with the onset of the
    pandemic recession. For women, connections to work started
    receding in the last two decades.
        Our report finds that government programs and policies are
    making work less attractive and that many Americans are
    voluntarily disconnected from work. That is a problem for our
    country, and it is certainly a problem for our social fabric.
    Fortunately, there is a lot we can do to reconnect people to
    work.
        To begin with, we have to start to begin to exist--to
    address existing policy. In many instances, existing policy
    causes or at least exacerbates some of these problems. Over the
    last 18 months, Congress increased safety net benefits and left
    those new and expanded programs in place for too long. Congress
    authorized unemployment checks that were sometimes twice as
    large as Americans' paychecks and provided rent subsidies,
    stimulus checks, loan forbearance, and new healthcare coverage,
    as well as expanded food stamps. Importantly, most of those
    benefits did not require recipients to look for work, even
    after vaccines were widely available to protect workers and
    businesses as they began reopening and rehiring workers again.
        Current legislative proposals could make many of those
    antiwork incentives permanent, which is the wrong choice.
    Instead, Congress urgently needs to implement policies that
    draw disconnected Americans off the sidelines and into the
    workforce. Congress must remove disincentives to work by
    strengthening work requirements and safety net programs for
    able-bodied workers. We should also be working to eliminate
    existing barriers to entry. Anytime we can do that, it helps.
    Some of those barriers include things like occupational
    licensing and labor regulations that prevent a whole lot of
    Americans from entering new professions or working flexibly on
    their own terms.
        Finally, the Federal vaccine mandate is an obstacle to
    connecting people to work. And there is no legal or
    constitutional authority for it. The threatened employer
    mandate has not even been issued yet, and Utahns tell me that
    it is already jeopardizing their livelihoods and that
    unvaccinated workers are preemptively being put on unpaid
    leave, which leaves them without a source of income, yet
    cruelly also leaves them ineligible for unemployment benefits.
        Under the mandate, some Americans would be forced to make a
    personal health decision against their will or face losing
    their job and, with it, their ability to put food on the table
    and feed their families. This ultimatum to workers is
    unacceptable. It is unlawful. It is unconstitutional. But, even
    worse than all these things, it is immoral. It is savagely
    cruel. It is barbaric. It has no place in our society, not this
    one, never.
        Note that opposing the mandate is by no means the same as
    opposing the vaccine. And I do believe the vaccine is something
    of a medical miracle, one that helps increase safety and
    security for millions of Americans as we return to places of
    work. That is why I have been vaccinated. That is why I have
    encouraged every member of my family to be vaccinated and
    others generally. But today we have to acknowledge that that is
    different than telling everybody he has got to get it,
    regardless of religious beliefs or preexisting medical
    conditions or whatever is on someone's mind, because it is not
    right to tell people that the government is going to force
    their employer to fire them, leaving them unemployable,
    unemployed, and without access in many instances even to
    unemployment. That is wrong.
        As of now, we need workers' contributions more than ever,
    and we cannot pretend to know what is good for every worker or
    every business. We must put trust back in individuals, back in
    business owners, and local decisionmakers. We must stop making
    policy decisions that discourage a return to work. Reconnecting
    Americans to work is one of the most important policy goals of
    our time.
        I look forward to today's conversation on that essential
    topic.
        Thank you, Mr.Chairman.
        [The prepared statement of Senator Lee appears in the
    Submissions for the Record on page 39.]
        Chairman Beyer. I thank you, Senator Lee, very much.
        I would now like to introduce our four distinguished
    witnesses. Dr. Betsey Stevenson is a professor of public policy
    and economics at the Gerald R. Ford School of Public Policy at
    the University of Michigan. She served as a member of the
    Council of Economic Advisers from 2013 to 2015 where she
    advised President Obama on social policy, labor market, and
    trade issues. She served as chief economist at U.S. Department
    of Labor from 2010 to 2011, advising the Secretary of Labor on
    labor policy and participating as the Secretary's deputy to the
    White House economic team.
        Dr. Stevenson has published widely in leading economic
    journals about the labor market and the impact of public
    policies on outcomes both in the labor market and for families
    as they are adjusting to the changing labor market
    opportunities. Her research explores women's labor market
    experiences, the economic forces shaping the modern family, and
    how these labor market experiences and economic forces on the
    family influence each other.
        Dr. Stevenson earned a B.A. in economics and mathematics
    from Wellesley College and an M.A. and PhD in economics from
    Harvard University.
        I believe, as the only male Member of Congress who attended
    Wellesley, I want to welcome you here especially.
        Mr. Skanda Amarnath is currently the executive director of
    Employ America, a research and advocacy organization that
    advocates for macroeconomic policies to promote sustainably
    tighter labor markets. He was previously a vice president at
    MKP Capital Management, where he served as a market economist
    and strategist. Prior to that, he worked as an analyst within
    the research group at the Federal Reserve Bank of New York and
    graduated from Columbia with degrees in applied mathematics and
    economics.
        Mr. Daniel Swenson-Klatt has been the owner and manager
    since 2006 of Butter Bakery Cafe in Minneapolis, a small
    neighborhood bakery, cafe, and coffee shop. He is a member of
    Small Business for Paid Leave. Since 2013, he served as a board
    member for the Kingfield Neighborhood Association. And, prior
    to the Butter Bakery Cafe, he was a middle school teacher for
    over 20 years. He holds a bachelor's degree in English language
    and literature from St. Olaf College.
        And, finally, Ms. Rachel Greszler is a fellow in the Grover
    M. Hermann Center for the Federal Budget at The Heritage
    Foundation, where she focuses on retirement and labor policy,
    such as Social Security, disability insurance, pensions, and
    worker compensation. Before joining Heritage in 2013, Ms.
    Greszler was a senior economist on the staff of the Joint
    Economic Committee--so welcome back--for 7 years. She completed
    her graduate studies at Georgetown University, where she earned
    master's degrees in both economics and public policy. She holds
    a bachelor's degree in economics from the University of Mary
    Washington.
        So we will hear your opening testimonies in that order.
        So, Dr.Stevenson, the floor is yours.

     STATEMENT OF DR. BETSEY STEVENSON, PROFESSOR OF ECONOMICS AND
        PUBLIC POLICY, GERALD R. FORD SCHOOL OF PUBLIC POLICY,
                 UNIVERSITY OF MICHIGAN, ANN ARBOR, MI

        Dr. Stevenson. Thank you very much for the invitation to
    speak to you today about the labor market.
        The employment landscape, as you all noted, is in flux.
    Employment remains well below pre-pandemic levels, and yet
    employers report shortages of workers. Quits and the intention
    to quit have hit record highs as workers are seeking and taking
    advantage of new opportunities.
        To be clear, most people quitting jobs are immediately
    heading to other ones, many of whom have already lined those
    jobs up. Some blame unemployment benefits for keeping workers
    at home, yet strong evidence directly contests this claim.
    States that ended unemployment insurance early saw no
    pronounced rebound in employment. Moreover, some industries
    have made a full return and currently exceed pre-pandemic
    employment, even though their workers were also eligible for
    unemployment insurance.
        If unemployment insurance is not holding back the labor
    market, what is? There are three important factors influencing
    the labor market right now. The ongoing pandemic continues to
    shape the labor market, from supply chain problems reflecting
    COVID around the globe to virus-avoiding behavior by both
    consumers and workers within the United States. The second
    factor is ongoing challenges in combining work and caregiving.
    And the third factor is shifting preferences by both consumers
    and workers that is causing a massive reallocation in the labor
    market right now.
        I want to urge you to look below the headline jobs number
    because each month in the labor market roughly 6 million people
    leave jobs and 6 million people start jobs. The trick to
    growing employment is to have the number of people starting
    jobs exceed the number leaving jobs. This means you need to
    care as much about why people exit the labor force as you care
    about trying to get people to enter the labor force.
        And that is why I want to talk to you about caregiving.
    Challenges providing care for a child or an adult with chronic
    health issues is a very important reason that many people leave
    jobs. They may hope to eventually return. But those who leave
    the labor force have a lower chance of being employed in the
    future compared to those who are able to meet their family
    needs while remaining employed. Keeping people in jobs is much
    easier than helping them return to the labor market.
        The United States has one of the lowest rates of female
    labor force participation in the OECD, ranking 23 out of 34
    countries. That is not where we used to be. We used to be
    number six. What has happened? We have fallen behind other
    countries in providing family-friendly workplace policies.
        The late 20th century showed us what adding women to the
    labor force can do. Prior to the pandemic, our GDP was roughly
    15 percent larger than it would have been if women's employment
    had been what it was in 1970. Yet two out of every three
    caregivers in the United States are women.
        So I want to make three points about paid leave because we
    have had decades to study and learn around the globe. And we
    now know that paid leave is essential to greater labor force
    participation. Paid leave increases retention of workers,
    reducing the chances that they exit employment out of the labor
    force. The vast majority of businesses find that paid leave is
    either positive for their business or has no noticeable
    negative effect. And children benefit from time to bond with a
    new parent, leading to higher lifetime wages and greater
    employment as adults.
        I urge you as you consider these policies to care as much
    about employment in 20 years as you do now and so thinking
    about investments in children beyond paid leave, such as
    through the child tax credit and support for childcare services
    to support not only our current economy but our future economy
    because it is ultimately human ingenuity that fuels our
    economic growth. Economic growth in 20 years depends on the
    choices we make today about investing in our youngest members
    of society. Economic growth today depends on the choices that
    you make to support parents and children.
        The challenges that parents face during the pandemic were
    not unique to the recession. Instead, they highlight our
    failure to adapt childcare, workplace flexibility, and
    workplace parental leave policies to meet the needs of a
    workforce in which women held half of the jobs prior to the
    pandemic.
        The choices you make now about paid leave, early child
    education, and childcare will shape the U.S. macro economy for
    decades to come by influencing who returns to work, what types
    of jobs parents are able to take, and what kinds of promotions
    parents are able to receive and accept. So I urge you to choose
    wisely.
        [The prepared statement of Dr. Stevenson appears in the
    Submissions for the Record on page 40.]
        Chairman Beyer. Thank you, Dr. Stevenson, very much.
        Next, we will hear from Mr. Amarnath.

     STATEMENT OF MR. SKANDA AMARNATH, EXECUTIVE DIRECTOR, EMPLOY
                        AMERICA, WASHINGTON, DC

        Mr. Amarnath. Good afternoon. Thank you for inviting me to
    testify at this hearing.
        As was noted, I am the Executive Director of Employ
    America. We advocate for macroeconomic policies that promote
    sustainably tighter labor markets. When labor markets are
    sustainably tighter, businesses actively compete for workers
    and are incentivized to make investments that improve
    productivity of their workforce and their businesses
    themselves.
        We are recovering at a rapid pace. But, until we can fully
    get behind this pandemic, we will not be able to recover all of
    the employment that has been lost. The presence of the Delta
    variant had identifiable impact on job growth in the food
    services sector in August and September. And, as another
    stylized example, education employment did not see its usual
    seasonal upturn in September because the impacts of the
    pandemic are still preventing a full normalization of
    conditions.
        The headline unemployment rate is 1.5 percent above where
    it was pre-pandemic, but this understates the true employment
    gap. The pandemic has also depressed labor force participation,
    which thereby distorts what the current unemployment rate is
    really telling us.
        Some might see this as a byproduct of people exiting the
    labor force for good. But the truth is we really don't know who
    is in the labor force and who is out of the labor force with
    any real precision, accuracy, or consistency. It is simply
    easier to look at who is employed and who is not employed and
    then benchmark to population and age structure, which is why I
    would recommend looking at the 25 to 54 year prime-age
    employment rate, what I would call the PER for short.
        It is 2.4 percentage points from its pre-pandemic peak in
    contrast to the 1.5 percent unemployment rate differential.
    That said, the PER has made a whopping gain of 0.8 percent over
    the third quarter. And, if we can continue to see these types
    of gains over the coming quarters, we will have made probably a
    full recovery over the course of next year. And this stands in
    marked contrast to what we saw in previous recoveries, which I
    would call jobless recoveries. We had a multiyear period of
    jobless recoveries after the previous three recessions under
    Presidencies of Democrats and Republicans alike.
        It took over a decade for the PER to recover from the Great
    Recession. It never recovered from its 2000 peak. The current
    trajectory might allow us to actually have a recovery in under
    3 years. And I would attribute much of the benefits here--
    obviously, every recession is different, but the responsiveness
    of monetary and fiscal policy is likely to play a key role in
    staving off the worst of the--of recessions in terms of the
    vicious cycles in cutbacks, layoffs, loan defaults.
        Policy implementation always has its imperfections, but
    families across the income distribution have made it out of
    this pandemic with actually higher cash buffers. And, while
    there are--disincentives are a big sticking point politically,
    I would say that the best evidence available does not really
    show an identifiable effect, especially if we look at the
    evolution of job growth around unemployment insurance cutoffs.
        On the other hand, using fiscal policy to keep people whole
    has allowed a lot of those vicious cycles to not materialize to
    the same extent. And I think that is a big reason for why we
    have seen such a rapid recovery in contrast to previous
    recoveries.
        Tighter labor markets, I think, play--macro policy has a
    big role to play in keeping labor markets tight. And I think we
    are seeing that now in terms of wage growth differentials are
    compressing so people at the lowest wage levels are able to see
    the fastest wage gains. We have seen that the employment rate
    differentials between Black and White persons has actually
    narrowed considerably to all-time lows. And I expect, as we did
    over the latter half of the 2010s, the differential employment
    rates between those who have a college degree and those who
    only have a high school diploma will also narrow.
        That said, the rapid pace of this recovery, there has been
    a--it has been so uncharacteristically rapid that the byproduct
    of that is we have seen some of these challenges constraining
    job growth become more visible. It is everything from
    microchips to ports to childcare. And so institutions that had
    grown accustomed to slack labor markets' slow jobless
    recoveries have been caught offsides by the pace of the current
    recovery. Sources of underinvestment have been exposed.
        The challenges of today can only be tackled through
    persistent investments in greater capacity and greater
    resilience. That is as true for bottlenecked sectors like
    automobiles and logistics as it is for people who are not able
    to be fully employed due to the lack of access to affordable
    childcare. If we settle for a shallow recovery from here,
    businesses will continue to underinvest, and fewer people will
    be able to participate in the benefits of a growing economy.
        As a final note, while I have referenced the importance of
    achieving a full recovery in the PER from the pandemic, that
    should not be the ceiling of our ambitions. It should--this
    should disappoint us all that the U.S. is a clear laggard among
    comparable advanced economies in terms of the prime-age
    employment rate. For a stark example, Quebec has a PER of 7.4
    percentage points above the U.S. A key ingredient to their
    success has involved raising the employment rates of women
    through the availability of universal childcare.
        If the U.S. is looking to catch up to the rest of the world
    on labor market outcomes, it will require ambitious investments
    in macroeconomic policies that promote and sustain a tight
    labor market.
        Thank you for your time, and I look forward to your
    questions.
        [The prepared statement of Mr. Amarnath appears in the
    Submissions for the Record on page 52.]
        Chairman Beyer. Thank you, sir, very much.
        Next, we will hear from Mr. Swenson-Klatt.

      STATEMENT OF MR. DANIEL SWENSON-KLATT, OWNER, BUTTER BAKERY
                         CAFE, MINNEAPOLIS, MN

        Mr. Swenson-Klatt. Chairman Beyer, Senator Lee, members of
    the Joint Economic Committee, thank you for the opportunity to
    be with you today and share my experience as a small business
    owner, representing Main Street Alliance, a national network of
    small businesses.
        I would also like to acknowledge that my home State
    Senator, Senator Klobuchar, has been a long and steadfast
    supporter of small business owners, and I really appreciate the
    work she has done.
        I have owned and operated Butter Bakery Cafe in Minneapolis
    for 16 years, partnering with the housing program to provide
    supportive internships during the last 9. My business has
    weathered recession, a move to a new location, major road
    construction, a pandemic, civil disruptions, and still we are
    open. I think of that as a major accomplishment but also a
    testament to my staff, my community support, and indeed to
    government support through the SBA.
        Just maintaining an 18-person crew is a full-time hat that
    I wear. We had 21 employees before the pandemic and dropped to
    a low of 12. Next week number 19 will be back on staff. I
    attract workers by offering a full wage, a fair wage, a healthy
    workplace, and a mission to serve our community. By choosing to
    offer a full wage to staff who customarily would rely on an
    unstable system of tipping, I get workers who invest in my
    business and currently have five with over 5 years.
        We build a culture that reinforces stability, and that
    model helps me. I spend less time on hiring, training, filling
    gaps in the schedule. It is good business, and it has been
    working. However, during the past year and a half, finding,
    retaining staff, indeed, the very model of my business has been
    turned upside down. I have needed 38 people over the past 18
    months to fill my workforce. They come and go.
        Many of the staffing obstacles small business owners have
    always struggled with have grown to a point of serious harm to
    our businesses. Where in the past I could use a few hundred
    dollars out of my pocket to get around a barrier for a staff
    member, the size and scope has exceeded my capacity. Without
    government support, I would have closed. Sadly, I know friends
    who did, who own businesses and did not have that support.
        My small business is still struggling. And, as I look to
    recover, rebuild, and, yes, even to grow, I am in a tough
    position. I do have working capital on hand, but it is in the
    form of a large debt. If used well, it might be able to be paid
    off through growth in my business. But right now I am still
    worried.
        We are facing challenges that are very different from the
    past, and I worry that current trends may not shift without
    some strategic investments in workplace supports from our
    government at all levels. And, frankly, you have bigger pockets
    than me.
        My applicant pool is limited in a number of factors,
    including lack of affordable high-quality childcare. I need a
    level playing field so employees with children can reach and
    afford childcare and get to a center or a childcare program.
    Currently my employees with children can only work limited
    hours.
        Access to affordable housing. While hundreds of new
    apartment buildings and units are going up around my cafe, only
    a tiny fraction are options that serve my workforce and the
    workforce of small business owners.
        Reliable, affordable transit would help. I do have to rely
    on transportation coming through for staff who don't walk to
    work, and I struggle more times than I admit with
    transportation options that fall through.
        A comprehensive paid leave program would be a way for my
    staff to take time off for health and personal reasons that
    doesn't put my business or their job at jeopardy. I am willing
    to contribute my part as an employer, just like I do for
    supporting sick staff, the unemployed, an injured or retired
    worker. The constraints of a small business budget do not allow
    me, though, to personally pay to begin a family or take care of
    a health crisis or find a safe place.
        Childcare, transit, housing, paid leave, they are just a
    few of the pieces. And there are so many more hats I have to
    wear to take care of my staff. And, with so many challenges
    resulting from this pandemic, bold, compassionate investments
    from our government will give me and my staff the hope and
    support we need to go to work, to get back to business, to grow
    again.
        Thank you for the chance to share my story, and I am happy
    to answer your questions today.
        [The prepared statement of Mr. Swenson-Klatt appears in the
    Submissions for the Record on page 59.]
        Chairman Beyer. Thank you, Mr. Swenson-Klatt.
        Finally, Ms. Greszler, the floor is yours.

    STATEMENT OF MS. RACHEL GRESZLER, RESEARCH FELLOW IN ECONOMICS,
    BUDGETS AND ENTITLEMENTS, THE HERITAGE FOUNDATION, WASHINGTON,
                                   DC

        Ms. Greszler. Good afternoon and thank you for the
    opportunity to testify.
        Today's labor market is unlike anything that we have ever
    experienced before in America, and certainly it is nothing that
    was predicted at the start of the pandemic. Wages are rising,
    and there has been a giant leap forward in family-friendly
    policies and workplace flexibility, and yet employers are
    struggling with this severe labor shortage. There were 10.4
    million job openings in August, even as 4.3 million workers
    voluntarily quit their jobs. Add to that an increasing number
    of employers who are being forced to fire workers that they
    desperately need because of an unauthorized Federal vaccine
    mandate, and we are at a gap of about 6 million jobs before
    what we had the trend prior to the pandemic. That has
    contributed to shortages of goods and services, longer waits,
    and higher costs.
        The solution to increase in employment is twofold. It needs
    to pay to work, and it can't pay to not work. The problem today
    is the latter. Government policies have made it so that it
    simply isn't worth it to work for some people.
        Eighteen months of unemployment benefits that pay people
    more to be unemployed than to work contributed to this drag on
    employment. States that ended those benefits early have
    experienced much faster recoveries. And an estimate shows that,
    had the States that didn't end the benefits early otherwise
    done so, they would have gained 800,000 more jobs in July and
    August alone.
        Then there has been massive expansions in ObamaCare
    subsidies, food stamps, and other welfare benefits that have
    made it possible for some individuals and families to be better
    off not working. This massive $3.5 trillion reconciliation bill
    will double down on employment losses by creating welfare-
    without-work programs. It discourages people from taking jobs
    and, at the same time, raise taxes and micromanage employers so
    that they are less likely to create jobs.
        The Texas Public Policy Foundation estimated that this bill
    would reduce employment by 5.3 million, while Casey Mulligan
    estimated it would cost 8.7 million jobs. Most of those losses
    would come from expanded ObamaCare subsidies and also the
    monthly child payments that eliminate work requirements. A
    study by University of Chicago economists found that those
    monthly child payments would cause 1.5 million parents to drop
    out of the labor force. That is particularly troubling when you
    consider that those losses would disproportionately fall on
    lower-income and single-parent families where work is an
    essential component to breaking cycles of poverty.
        Unpublished data from the Bureau of Labor Statistics
    suggest that this could already be happening. When the pandemic
    first began, parents actually experienced fewer employment
    losses. But, since the late spring of this year, coinciding
    with the start of the monthly child payments, that trend
    actually reversed and parents' employment declined. Some have
    pointed to childcare struggles, especially when arguing for
    massive new childcare entitlement that would disproportionately
    benefit high-income families and be out of reach to families
    that prefer faith-based or family based childcare.
        But a May 2021 study by Jason Furman, former chair of
    President Obama's Council of Economic Advisors, found that
    childcare struggles were causing zero impact on parents'
    employment. That was May 2021. And there is simply no
    explanation for why, since that point, a year after the
    pandemic, childcare struggles would now be causing this big
    drag.
        In addition to discouraging work, the Big Government tax
    and spend package would micromanage employers, limit workplace
    flexibility, and exacerbate supply shortages and cost
    increases.
        For example, just as workers' access to paid family leave
    has increased 64 percent over the past 5 years, politicians
    want to replace those flexible and accommodating policies with
    a one-size-fits-all government-controlled one. And then there
    is a push to ramp up fines on employers and force more workers
    into unions. The debacle at the ports in southern California
    shows what happens when unions refused to increase operations
    and when environmental and labor restrictions prevent 80
    percent of trucks in the Nation from entering the State and
    when government regulations limit how, who, and where people
    can work. And now as many Californians are fleeing the State,
    the reconciliation package seeks to impose California's failed
    policies on the rest of the Nation.
        Command economy tactics and cradle-to-grave welfare
    programs won't help Americans thrive because individuals,
    families, and employers are far better than politicians in
    making decisions that impact their everyday lives and those
    around them.
        When President Clinton signed the historic welfare reform
    in 1996, he quoted Robert Kennedy who said, ``Work is the
    meaning of what this country is all about. We need it as
    individuals. We need to sense it in our fellow citizens, and we
    need it as a society and as a people.''
        Politicians can help empower Americans to succeed by
    allowing them to keep more of their earnings, by reducing
    regulations, by allowing more flexible job opportunities and
    more accommodating benefit options, by expanding educational
    choices, and by trying to help get people off of welfare
    instead of anchoring them to it.
        Thank you.
        [The prepared statement of Ms. Greszler appears in the
    Submissions for the Record on page 63.]
        Chairman Beyer. Ms. Greszler, thank you very much.
        And thank all of you for your testimony.
        We will now begin a round of questions. I will begin.
        I am reading Rick Atkinson's new book on the Revolutionary
    War, where I discovered that George Washington, as the first
    general of the Continental Army, required smallpox vaccinations
    for all the troops. A lot of history there.
        I would point out that 1 million people in American have
    already died from COVID-19, and it is not just about your
    personal desire to risk death. It is about the significant
    likelihood that you will cause the illness or death of others.
    We certainly wouldn't want people with very contagious polio or
    leprosy or smallpox wandering through our businesses and our
    population.
        Dr. Stevenson, I am concerned--Ms. Greszler talked about
    the States that eliminated those benefits early had faster
    growth than those that didn't. I read studies in both The Wall
    Street Journal and New York Times that pointed exactly to the
    opposite. Can you as former chief economist of the Labor
    Department comment on that?
        Dr. Stevenson. Yes. So I have seen a number of studies that
    found that there was no effect at all from ending the
    unemployment benefits early in terms of increasing employment.
    That is what economists, market-based economists, found at
    places like Goldman Sachs and other--I would say market
    economists who have an incentive to go where the truth is. I
    have also seen academic economists like Arin Dube, who did a
    very deep analysis and found no real effect.
        The biggest criticism I have heard of these--said on these
    studies is that, when the States ended those unemployment
    insurance benefits early, they also saw a rise in COVID cases
    from the Delta variant and whether that is clouding any ability
    to do the analysis. I am not sure if that is what Casey
    Mulligan was trying to account for to get the results that you
    just heard, but there is a wide range of studies that do find
    the exact opposite that we saw and that ending unemployment
    benefits early did not send people back to work.
        Chairman Beyer. Just note that Virginia kept the benefits
    and has an unemployment rate nine-tenths of a percent below the
    national average.
        Mr. Swenson-Klatt, you had talked about the baker who had
    one week of leave added up and you paid the rest of it, the
    other 2 weeks, and actually deferred your own salary. How many
    small business people do you think can pay this out of their
    profits or defer their own salaries to keep their people?
        Mr. Swenson-Klatt. Thank you.
        And, before the pandemic, those kind of opportunities were
    really pretty hit and miss, whether the bakery was ready, had
    some cash-flow, whether I could feel like I could give away a
    couple of months of time. There are plenty of times I never did
    that for staff who needed the time away, who we just didn't
    have the cash to do it. And it is more the story that I hear
    from other employers that they just wouldn't have paid that. It
    wasn't available to them. We don't have that kind of cash flow.
        When the pandemic assistance came, all of a sudden, I found
    I had a way to pay people to be away. And that was just an
    amazing gift for me as a business owner and for my staff.
        Chairman Beyer. Thank you.
        Dr. Stevenson, how do you feel about the adding the work
    requirements? And what is the evidence about work requirements
    and its impact on these families that need the help?
        Dr. Stevenson. So the amount of money in the child tax
    credit is terrific for reducing poverty but not enough to
    replace a salary and this is--or wages, and this is why I don't
    think that the evidence is very strong that it would lead
    people to not work.
        Let me be clear. I very much support increasing financial
    support for childcare. Putting a work requirement on the child
    tax credit is turning it into a childcare credit for single
    parents because you are requiring them to work and incur costs
    regarding childcare.
        I find it very difficult to put together the arguments that
    want to allow families to be able to make the right choice for
    them about when they provide care for their own children and
    when they are in the workforce with the idea of putting a work
    requirement on the child tax credit. The point of the child tax
    credit is to ensure that children don't grow up in poverty, and
    we shouldn't be requiring that everybody in the household work.
        I also just have to point out that there is a very
    disturbing inequality with the work requirement on the child
    tax credit in that my understanding is the way it would be
    implemented at the household level. So you would be requiring
    that a single mother works but would not be requiring that a
    married mother works, and that is a gross inequity that we
    should not allow.
        Chairman Beyer. Thank you, Dr. Stevenson, very much.
        Let me now defer to the Senator from Utah for his
    questions, Senator Lee.
        Senator Lee. Thank you, Mr.Chairman.
        Ms. Greszler, I would like to start with you, if that is
    all right. Work is something of a foundational component of
    living a happy, healthy, productive life. Research from our
    team here at the Joint Economic Committee's Social Capital
    Project has shown that being out of the labor force is not only
    associated with less income but also poorer social outcomes,
    more physical ailments, and worse emotional well-being. Given
    the benefits associated with work, I think encouraging work is
    important, and discouraging it should be avoided.
        Dr.William McBride, a witness at our previous hearing,
    noted in his research for the Tax Foundation that tax hikes in
    the Build Back Better Act would cost Americans more than
    300,000 jobs. This plan would also remove work incentives in
    the child tax credit and the Dependent Care Credit.
        For mothers and fathers who already have weak ties to the
    labor market, for them in particular, how will they be affected
    by removing these requirements? And rather than giving up on
    work as the primary way to increase living standards, are there
    other policies that you would suggest to increase these
    opportunities for Americans?
        Ms. Greszler. Yes. So, the massive reconciliation package
    has multiple ways in which it discourages work, primarily by
    making work not pay, especially for people who are at the
    margin, and that is at the lower end of the income scale. My
    colleague, Robert Rector, estimated that this proposal would
    add about $8,500 in new benefits to a family that is already
    receiving about $36,000 worth of cash, food, and housing
    benefits. That is not even counting the healthcare and so you
    are creating a situation where individuals can be better off
    not working, and yet we have seen that historically breaking
    cycles of poverty means you need to have an example of work in
    the home. If you have a two-parent home, then, yes, one worker
    could be working. And one could be staying home with a child.
    If it is a single parent, there needs to be that example of
    work there.
        And, in terms of increasing employment, increasing the
    incentive to work, and helping to have more of that in the
    economy, there are many ways that you could do that. One of
    them I think is particularly fruitful during this time--and I
    am looking at women in particular--is more opportunities for
    flexible work, freelancing work, independent work so that it
    doesn't have to be the 9 to 5 job where you have to report to
    the boss and you have to check in and sit at your desk, but
    things that I have seen so many women, my friends included,
    that they are able to do, whether it is in the morning or at
    night, and still be able to care for children.
        We shouldn't be closing doors to opportunities. And that is
    what is in this proposal in many ways, including forcing people
    into those unionized, one-size-fits-all jobs.
        Senator Lee. Right. So, in many instances, you actually
    have Federal law and Federal regulations based on Federal law
    serving as a restriction on those things, and reforms like the
    Working Families Flexibility Act, which would allow America's
    moms and dads to make decisions that better reflect their own
    needs, would help this problem in the same way that this
    legislation would make it worse.
        Ms. Greszler. Absolutely. And your Working Families
    Flexibility Act is one of the best ways because it is
    particularly geared for those lower income, hourly workers. And
    all it does is give them an option: If you want to work 2 extra
    hours this week so that you can take 3 hours off next week,
    that is a choice. Nobody is forcing it. It should absolutely be
    done to help increase that access to paid family leave.
        Senator Lee. Now last month's disappointing jobs growth
    report underscores the uncertainty associated with our slowly
    recovering economy, and at the same time, employers across the
    country are increasingly desperate to find qualified and
    willing workers who are able to fill, you know, more than 10
    million open jobs.
        President Biden's vaccine mandate from my perspective not
    only will but is already making things worse, which is odd
    because it doesn't even exist yet. He hasn't had the decency to
    share it with us. So it can't be challenged in court, can't be
    scrutinized. But people are following it because the interim
    effect of these anticipated daily civil monetary penalties like
    $70,000 per worker per day per violation is causing a lot of
    corporate America to just say we are going to try to guess what
    it is so we are not caught flatfooted. I have heard from
    employers across Utah say they may have to fire as much as 20
    percent of their workforce.
        So the vaccine mandate is just one more example of
    Washington getting in the way of the recovery. And so, if the
    President doesn't reverse course, what will be the effect of
    these policies on Americans' conditions as they approach work?
        Ms. Greszler. And it is not just the loss in jobs. We are
    also talking about a loss in the safety and the health and
    education because these are the people who are being impacted
    most. New York City had to lay off thousands of school workers.
    They have had to lay off thousands of healthcare workers, shut
    down maternity wards. My sister lives in New York, and she had
    one of her young children who had to have an operation. And she
    was told to travel 170 miles to Pittsburgh because the closer
    hospital by them was having staff shortages due to the vaccine.
        So this is absolutely impacting Americans, and I think it
    is very ironic and just wrong that yesterday's heroes are now
    today's villains and are being fired.
        Senator Lee. Unacceptable, un-American, unconstitutional,
    and immoral. Thank you.
        Chairman Beyer. I would like to point out that I heard last
    night that we have 1,042 Virginia children have been
    hospitalized with COVID. And two died 2 days ago.
        Senator Heinrich, the floor is yours.
        Senator Heinrich. Thank you, Chairman.
        And let me start by just saying how grateful I am to have
    had the college degree that my father's one-size-fits-all union
    job made possible.
        I want to talk about New Mexico and childcare. In New
    Mexico, the cost of two children in childcare is about $18,000
    a year. That is a lot less than a lot of other places, I will
    give you. The Build Back Better plan would limit out-of-pocket
    expenses for childcare to 7 percent of a family's income, and I
    know full well what that would mean for my constituents.
        But, Mr. Amarnath, I want to ask you to tell me what it
    would mean, how that could impact the prime-age employment
    rate, and also why that is important.
        Mr. Amarnath. Yeah. So your question really helps to
    highlight an area where the U.S. has been lagging for such a
    long time relative to other advanced economies. So we talk
    about childcare being acceptable and affordable, we look at
    those countries that have actually made a real concerted effort
    to make sure that it is affordable and acceptable. And if that
    means subsidizing the wages and workers to--of childcare to
    make that possible, employment rates are much higher in--as Dr.
    Stevenson also pointed out, prime-age employment rate, which
    adjusts for waging, yes, people are aging into their retirement
    ages or maybe going to school if they are younger, but the 25-
    to 54-year-old cohort, we are talking about employment rates
    that are in the U.S. much lower than most other advanced
    economies. And we should really be asking why that is and what
    is the constraint and what led other countries to race ahead.
    And a big part of that, I would argue, is female employment
    rates have been able to rise because not all work has to be
    done within the household. You actually are able to have that
    flexibility that childcare is not so punitively expensive on
    the market that you have to effectively be at home.
        As I said, if we could take a very stark example of this,
    even with north of the border, Canada has higher employment
    rates, has continued to see higher employment rates, and in a
    country like--in a province like Quebec, which is not really
    maybe known as much, but it is 7 percent more than the U.S.
    That is like a--that is a pretty substantial amount. If we were
    to say that 7 percent decline in the employment rate, if you
    could do something like this, I think we would all should at
    least, like, pay closer attention to this issue.
        Senator Heinrich. Yes, it seems like one of the things we
    all agree on actually, which is surprising that we can all
    agree on something, is that we would like to see more
    participation in the labor force.
        Dr. Stevenson, do work requirements actually get us to that
    goal? And what would the impact of a one-size-fits-all work
    requirement, say for the child tax credit, to be able to get
    that mean for grandparents who are raising, are the primary
    caregivers, and have custody of their grandchildren, which is a
    very common situation in the State of New Mexico.
        Dr. Stevenson. So, I think that it is not going to put
    people back in jobs. What it is going to do is remove cash from
    the household. When you remove cash from the household, you end
    up hurting kids, and you end up reducing labor force
    participation of those kids as they grow up. So you actually
    can end up ultimately having a negative effect by putting a
    work requirement on them.
        I think that it is really important to think hard about how
    people choose when and where to work. We have heard a lot about
    how, you know, a vaccine mandate may lead some people to leave
    a job but because they don't want to get vaccinated. It is
    really important to focus on the number of people who are not
    in jobs rights now because they are afraid of getting COVID and
    afraid of unvaccinated colleagues.
        I want to bring that up because you mentioned grandparents.
    And what we saw was a large decline in labor force
    participation among older workers, an increase in retirement.
    We are not going to be able to push these older workers who are
    fearful of getting sick and potentially dying from COVID back
    into the labor force by putting a work requirement on a child
    tax credit. What we can do is help households make ends meet so
    that they can then think about how to better participate in the
    labor force.
        You know, one of the things we are seeing right now with
    all those quits is people are going into better jobs, better
    jobs that I think they will be able to stick in for longer. And
    that will ultimately also lead to higher labor force
    participation. So getting people not just into any old job but
    into a job that pays a living wage that they feel valued in,
    that they can stick in, allows them to stay for 5 years like we
    have heard that people do when they are in a good job.
        Senator Heinrich. Mr. Chairman, in the interest of
    facilitating other members of the panel, I am going to give the
    rest of my time back.
        Chairman Beyer. Thank you, Senator, very much.
        Now I would like to recognize my friend from Arizona,
    Representative Schweikert.
        Representative Schweikert. Thank you, Mr. Chairman.
        Look, I have shared with you a little bit of my
    frustration, having been on the Joint Economic Committee for a
    long time. We can do better on the intellectual credibility of
    what is being handed to us. We are better than much of this
    testimony.
        Just for the record, I thought I might hand you the Federal
    Reserve Bank of St. Louis study from about a couple of weeks
    ago that actually does show the employment differentials of
    States that did cut back or end their extended stint on
    unemployment. And the numbers are actually fairly dramatic.
        I want to talk about this one before I ask to hand it in to
    the record because you mentioned it in your opening testimony.
    We have also the big study, which actually I found fascinating,
    from the four economists, PhDs, at the University of Chicago.
    And I have an absolute fascination and fixation on labor force
    participation numbers. Why did it--was there such an economic
    miracle in 2018 and 2019, particularly being from the desert
    Southwest, you know, my numbers for Hispanic females were
    remarkable. The wage growth was remarkable, without all the
    social engineering that is part of this package. So what
    happened? Why did it work?
        And then this University of Chicago study that sort of
    walks through, saying, you know, there is a line here. You
    know, the decline of employment--in employment and
    consequential earning loss means that child poverty would fall
    about 22 percent, but for severe poverty, it doesn't fall at
    all.
        So the stunning amounts of money and the design of the
    program that is being floated doesn't actually help the very
    people we care about. Maybe it is time we intellectually step
    up our game and start thinking about what works and what
    doesn't work, not just the folklore of that is a Republican
    idea, that is a Democrat idea, and actually think about do we
    actually give a damn about helping people, because the, I mean,
    academic paper after academic paper says, yes, you get some
    effect but for the people you most care about, it doesn't work.
        You actually talked about the paper. Why doesn't it work?
    And what do you think we should do that is different that
    actually would reflect the success, particularly we were having
    in 2019?
        Ms. Greszler. Yes. Well, and we saw in the paper there, you
    quoted, that the deep childhood poverty, that it would have no
    impact on that. And yet we are considering increasing these
    monthly payments up to $1,000, $1,600 a year. That doesn't make
    sense. So what that says is that the furthest low end of the
    income scale, those are the people who are going to lose that
    work connection. And that is where it is most important because
    we know that that is what is crucial to breaking those cycles
    of poverty. You can't make a situation where a family is just
    as well off or better off by not working than by working.
        And so you absolutely have to have those incentives in
    there, and it can't be government micromanaged. Here is
    government job training. Here is government paid family leave.
    Here is government childcare. We saw that what happened after
    the Tax Cuts and Jobs Act that included tax cuts on
    corporations, they fed it through to their workers. Some of
    those companies went out, and they polled their workers. What
    do you want? You want higher wages? You want more compensation?
    A lot of this time we want paid family leave. That is why we
    saw a 64 percent increase in paid family leave. We saw a $1,400
    above-trend wage growth in the period after that because those
    tax cuts fed through, and they resulted in workers having
    higher incomes.
        And they also just gave more opportunities out there.
    Employers were willing to invest in their workers with job
    training programs, and the opposite is occurring here because
    you are going to take away from the people who are creating
    jobs and redistribute it in ways that discourage people from
    taking jobs.
        Representative Schweikert. Look, we have lots of good data.
    And it is real math of the miracle numbers. I mean, it was a
    Goldilocks economy that demonstrated once again that supply
    side does actually work, great wealth effects, closing of
    income inequality, minority population seeing wage growth and
    employment growth.
        And I despise storytelling, but I am going to actually
    break my own rule. Great experience. Homeless community in
    Phoenix, we actually do a combined homeless shelter. Helped
    work on it a few years ago. St. Joseph the Worker actually had
    this explosion of people begging, saying, ``We are willing to
    take a chance; send us homeless people because we are so
    desperate for workers.''
        So it is somewhat what was said over here, if you can make
    labor valuable. Almost every one of these proposals being
    offered by the Left devalues labor.
        And, Mr. Chairman, that is my great fear is--we both care.
    My fear is those Left proposals are going to make things much
    worse.
        And, with that, I yield back and would like to also before
    you, you see, hand the documents for the record.
        Chairman Beyer. Without objection, those documents are
    accepted.
        [Articles submitted by Representative Schweikert appears in
    the Submissions for the Record on page 81.]
        Chairman Beyer. And I would suggest that we be careful
    about devaluing any of the experts' testimony because there are
    contradictory studies. There may be one from the Fed. There are
    also those from the University of Chicago, from J.P. Morgan,
    from AP, and others that claim the UI benefits did not create
    slower----
        Representative Schweikert. Actually, Mr. Chairman, knowing
    two of the studies, they were actually before about half of
    these States had actually begun their rollback.
        Chairman Beyer. Let me also point out that claiming that
    the CTC does not work at all for those in extreme poverty, not
    working at all is different from being insufficient to lift
    them out above poverty. It is hard to imagine that $250 and
    $300 per child----
        Representative Schweikert. Mr. Chairman----
        Chairman Beyer [continuing]. has no effect at all.
        Representative Schweikert [continuing]. once again, it is
    the quote from the study. It is not my quote.
        Chairman Beyer. Thank you.
        Now let me recognize Mr. Peters from California.
        Representative Peters. Thank you, Mr. Chairman.
        I don't want to spend a lot of time on unemployment
    supplements. You know, we knew we overshot. The risk we took
    was we were overshooting in order to avoid an economic
    disaster. So, if we ended up paying unemployment benefits for a
    little too long, it may have suppressed employment at some
    point. And I think that is good for next time, but that is over
    with. So that is retrospective, and we are not talking about
    extending those right now. So I would put that to bed.
        The other thing about vaccines is, sure, I think probably
    we have heard that vaccines have encouraged some people to
    quit. I am sorry that they don't want to get vaccinated. On the
    other hand, in the face of a pandemic where a million people
    have died, the workforce is not the only public policy we have
    to be concerned about. We have to be concerned about actually
    protecting each other. And so I don't think that rolling back
    the vaccine mandate is the proper way to get at the worker
    shortage that we are facing right now. I don't think that is
    the right strategy.
        One strategy you didn't mention that I am curious about--
    and I would ask this for, I guess, for Mr.Amarnath, the role of
    the immigrant workforce when it comes to our labor shortage. I
    mean, one idea about getting more labor is to actually to bring
    more in. And that is what we have done traditionally. Would
    that be a good solution, and what would that do to economic
    growth in general?
        Mr. Amarnath. Okay. I think it is a sort of direct matter,
    immigration leading to higher labor force growth and, thus,
    sort of somewhat mechanically leading to higher upward growth,
    so obviously there. There are areas where we have sort have
    identifiable labor shortages and not just sort of anecdotes in
    terms of manufacturing and construction where you can point to.
        To the extent we can bring people, especially those who
    have actually been working here and done a lot of the essential
    work, that obviously would be beneficial to be able to create a
    more robust workforce.
        Representative Peters. Dr. Stevenson, would you comment on
    that as well, the role of immigration?
        Dr. Stevenson. So I do believe that we are seeing some
    labor market problems that come from the fact that we have not
    had as many foreign workers come in to the country. At the risk
    of enraging some of you, I will give you a story, which is, at
    the University of Michigan, we don't have a lot of foreign
    students on campus. And we definitely see the places where the
    foreign students used to work are having problems hiring
    people.
        There are certainly industries that rely on foreign workers
    that are having a hard time finding people. I think it would be
    really valuable to be thinking in the context of immigration
    reform. This--looking very closely at this question of how
    immigrants support the U.S. labor market and support growth
    because this has certainly been a time with closed borders and
    limited foreign workers.
        Representative Peters. Let me ask you about your testimony
    about economic recovery and employment stability. In my
    district in San Diego, we rely a lot on tourism and
    hospitality. It is a significant part of our economy. What
    would you say about tourism and hospitality? What could
    employers do to increase stability in their workforce when
    these jobs don't always come with benefits and other
    incentives?
        Dr. Stevenson. I think the first thing to say is these jobs
    have become much riskier. These were not risky jobs. In fact,
    when I was a kid, a college student, a young person in my
    twenties, these were fun jobs.
        They are now jobs where, first of all, just the level of
    animosity in the way people are treating each other is making
    these jobs less fun, and the fact that you have to ask people
    to put their mask on has made them less fun.
        It is also pointing to the need for these jobs to just pay
    a living wage. You know, we really need stability in our work,
    and that means being able to be--not rely on a job which may
    lay you off tomorrow, and that is actually one of the real
    things still going on in leisure and hospitality. There are a
    lot of workers who are still at risk and will lose their job
    potentially tomorrow, could be losing their job right now as we
    speak because the pandemic as it goes on is causing--some of
    the tourist industry is struggling to keep afloat. And that is
    the biggest way we will get the tourism industry back on track,
    is to vaccinate more of population.
        My kids would like to go to Disney World again. We are not
    there yet as a country in my perspective. And I think that that
    is why we don't have as many workers back there. I think that
    that it is incredibly important that these jobs become more
    stable, they pay better, and we find a way to make them safer
    than they are right now.
        Representative Peters. Let me just ask you one more
    question about the child tax credit. The idea of a child tax
    credit to provide additional funds for families that have
    children, doesn't that address the ability of parent choice
    because I guess you get money for a child? You can decide to
    use that income to stay home, or you can decide to deploy that
    money to childcare, if childcare exists. In terms of choosing
    policies, isn't that really the most efficient, economically
    sound program?
        Dr. Stevenson. To be clear, there is no work disincentive
    from the child tax credit because, if there is no work
    requirement on it, parents can get access to this money, and
    they have the choice then of what they are going to do. If we
    put a work requirement on it, then you are effectively saying,
    ``I am going to give you money to pay the additional costs of
    you going to work.'' If you don't put the work requirement on
    it, you are letting parents choose what is right for their
    family.
        Representative Peters. Right. I think parent choice is
    something we all would like to support.
        And I yield back.
        Chairman Beyer. Thank you, Mr. Peters.
        Let me recognize now the Congressman from Kansas, Mr.
    Estes.
        Representative Estes. Thank you, Mr. Chairman.
        And thank you for all our witnesses for being here today.
        And, without enough workers, Americans across the country
    will continue the experience of rising prices, longer wait
    times, and shortages. The Kansans I represent are rightfully
    alarmed about the direction of the economy. You know, inflation
    levels are at a level not seen for 30 years, and businesses are
    unable to find enough workers. Instead of searching for
    solutions to make hiring easier, the Biden administration has
    decided to implement a series of policies that create barriers
    and make it harder for businesses to find workers. They have
    even gone so far as to force businesses to fire workers for
    reasons unrelated to their work due to the recent OSHA mandate.
        It is clear that the vaccine mandate will lead to serious
    disruptions across the U.S. economy. That is because it is both
    unreasonable and unaccommodating. There is a recent Washington
    Post poll that found 72 of unvaccinated Americans would quit
    their jobs if their employers forced them to get the vaccine
    without the opportunity for exemptions. The mandate will surely
    lead to more worker shortages across the country, both within
    critical supply chains and within the healthcare industry. The
    administration has estimated that their mandate will apply to
    two-thirds of the workforce.
        Just this week, the American Trucking Associations warned
    the White House that in regards--in response to the vaccine
    mandate, many drivers will likely quit. There is already 80,000
    worker shortages in the trucking industry today, and forcing
    more workers to quit in a time when we desperately need them is
    not the right approach.
        I think it is important to point out that, not only is
    President Biden's order unconstitutional, it does not
    contribute to building a stronger healthcare industry. We are
    seeing hospitals that are already dealing with staffing
    shortages now unable to staff beds as part of the result of the
    Biden mandate. One hospital, of course, as we have all talked
    about, has been forced to put baby deliveries on hold after
    maternity workers quit in protest to the mandate. The reduction
    in healthcare workforce, as caused by the mandate, has
    dramatically lowered capacity to respond to COVID as well as
    other infectious diseases and high-risk events like heart
    attacks and strokes.
        The solution to fix the current record high gap between the
    number of job openings and the number of employed workers--
    unemployed workers is not more taxpayer-funded programs but
    policies that finding workers--make it easier for industries.
        Ms. Greszler, President Biden's so-called Build Back Better
    Act would lead to greater upward pressure on prices and further
    disincentivize able-bodied adults to work. If passed, how much
    would the Build Back Better Act accelerate both the inflation
    and labor market crisis we are currently experiencing? And how
    bad could microeconomic conditions become?
        Ms. Greszler. Well, we have heard some estimates in terms
    of potential employment and job losses in the 5- to 8 million
    range. And we really don't know what is going to happen to
    inflation, and there are a lot of factors at play there. But
    certainly Americans have experienced the impact of employers
    not being able to fill their positions and that leading to
    higher prices at the grocery store, at the gas station, on
    pretty much everything that we are purchasing, and also
    shortages, not even being able to get certain things. And then,
    in looking at the Build Back Better Act and just all the rules
    that it is going to put on employers micromanaging everything.
    I mean, when you look over that, it just makes it so difficult,
    you wonder, why would anybody even want to create jobs and why
    would they want to run a business and provide that income and
    that opportunity to individuals when the government is going to
    be the one that is going to tell them when their workers can
    have access to paid family leave? They are going to tell them
    whether or not they have to join a union and therefore breaking
    that ability for the employee and the employer to work
    together. That particularly concerns me among women who like to
    have greater flexibility in the workplace. And they might not
    want the rules that the union is negotiating, or now, being an
    employer, you are going to have to automatically enroll workers
    in a retirement account, even if you don't have one set up for
    them yet, and you are just going to have all of these mandates
    piled on top of one another that just creates an enormous
    burden on employers.
        Representative Estes. You also pointed out that the Green
    New Deal would cost every American $1,991 per year over the
    next decade, or nearly $8,000 per year for a family of four.
    Combined with some of these other ongoing proposals, you note
    that the typical American household will pay about 10,000--they
    would pay about $100,000 over the next decade. So, if passed,
    how does this increasing burden on households affect our
    economic growth?
        Ms. Greszler. Well, it leaves everybody less well off in
    the end. Less income, less opportunity. And I think that it is
    easy to sell a $3.5 trillion package as it is going to provide
    you childcare, it is going to provide you paid family leave, it
    is going to give you a monthly check, it is going to do all
    these things for you. But there are two sides to everything.
    Everybody argues about I want to see the one-handed economist
    because, well, actually there are two realities. And what are
    the costs on the other side of that? And, yes, if you just look
    at some of those things, I added it up, and potentially the
    typical American household would have $100,000 less purchasing
    power in the future in order to tradeoff these things where
    they are going to get what the government gives them instead of
    what they could otherwise go out and decide what they wanted to
    get on their own.
        Representative Estes. Yeah. You noted something very
    important there that the Federal Government can't give any
    money away in a program unless it takes away from a taxpayer to
    begin with.
        Ms. Greszler. And I think that is very important to think
    about here, is we have heard your pockets are deeper than my
    pockets. Your pockets are reaching into the pockets of every
    American and every business owner in order to take money out of
    them to give it back to somebody else. We are not just talking
    about money that is growing off of trees here. Even if it is
    monthly child payments, that money has to come out of economy
    somewhere. And it comes out of the paychecks and the incomes of
    families who are parents, who do have children. So it is not
    just all a net gain to be sending money because it is coming
    from the Federal Government.
        Representative Estes. Thank you. And I yield back.
        Chairman Beyer. Thank you.
        I now recognize the gentleman from Wisconsin, Mr. Pocan.
        Representative Pocan. Thank you very much, Mr. Chairman. I
    appreciate it.
        And thank you for all the witnesses for being here.
        I am not going to refer to, I guess, studies. I am going to
    do it from practical experience. I am a 34--almost 34-year
    owner of a small business. Started it when I had hair. I was 23
    years old. It has been a while back. And, you know, I talk to a
    lot of small business people because those are the people I
    have known for most of my adult life. One of my largest
    employers in my district is in California and Wisconsin. He has
    6,000 employees. He told me recently he was up to 70 percent of
    allowed back on vaccination rate, and an employee came in with
    COVID. And he decided he was going change that. So he did all
    sorts of initiatives. Got up to over 99 percent and, finally,
    at the end, had to fire 40 people out of 6,000. That is about
    two-thirds of 1 percent. So those studies that say 20 percent
    of people will be fired for not doing mandates, I am just
    telling you that the people I talk to in Wisconsin don't
    necessarily have that study, but they have the practical
    experience of that not being real, as I mentioned that.
        I also belong to three Chambers of Commerce. Very active in
    a number of business issues. We had the SBA Administrator in
    Wisconsin a few months back. And I invited all the different
    business groups to have a meeting with her. And my largest
    chamber, the Madison Chamber of Commerce--Madison is about
    250,000 people. They and the Wisconsin Manufacturers and
    Commerce, which is one of the most conservative business groups
    of everybody else I invited in my State, said they just did a
    survey of members and how the chamber said that the number one
    issue blocking people going to employment was childcare.
        And one of the initiatives that we are trying to do and I
    think is going to be in the Build Back Better agenda is this
    childcare initiative to reduce it to 7 percent. And, much like
    Mr. Swenson-Klatt, as a small business person, I have got
    someone starting Monday as well. That will bring us back full
    complement pre-COVID. But their childcare they just got is
    costly, quite a bit by the percent. And this would be a game
    changer.
        Dr. Stevenson, just from that practical thing, you are
    going to give me maybe the scientific side of it. I am going to
    give you the practical side. If I am being told by employers in
    my area that the number one barrier to getting people hired
    right now--and we certainly all have that experience--is
    childcare, can you just talk a drop more about how important
    that initiative of 7 percent of your income covering childcare
    would mean?
        Dr. Stevenson. It is a practical reality that you cannot
    pay more for childcare than you are being paid for your own
    job. That is just a limit that people have. Childcare is more
    expensive than college for many families. And, yet, we spend a
    lot of time wondering how families are going to pay for college
    and college tuition. And we leave them on their own,
    particularly when they are younger, with lower incomes than
    they might have when their kids are old enough for college, and
    we tell them to figure childcare out on their own. A lot of
    parents simply can't do it. They try to cobble together plans.
    They might use a network of relatives or neighbors, and some
    amount of paid childcare, but they are running into troubles.
        We are seeing upward pressure on wages at the bottom end of
    the income distribution. This is actually a good thing. This
    means that many people who are our lowest wage workers are
    going to be earning a living wage. But childcare providers are
    struggling because, if they pay more than $12 an hour to keep
    up with what Amazon's warehouse is paying, what Starbucks is
    paying, they have to pass those costs on to parents, who are
    themselves not earning much more than the childcare workers
    themselves.
        That is going to cause--as childcare workers' wages will go
    up whether you do something or not, because wages at the bottom
    are going up. As those wages go up, people will drop out of the
    labor force because they are unable to pay for that childcare.
    That is the reality. You need to step in and try to support
    that.
        And just one other thing to add to that is the research
    does show that every dollar we invest in young children comes
    back to the taxpayer in terms of $7 to $8 later on. Somebody
    does have to pay for these costs. It turns out they are paid
    for by increased productivity of those kids as they grow up.
        Representative Pocan. Thank you. I will never forget, too,
    when the Affordable Care Act got in place, I had a childcare
    provider in my district stop me in the grocery store and cry
    because she finally had health insurance for the first time. So
    I appreciate that.
        Mr. Swenson-Klatt, you are like me, someone who I spent
    that many years and how you spent a long time building your
    business. You specifically brought up family medical leave,
    paid family medical leave. Can you just talk a bit more about
    how that would help you both in attracting employees and being
    able to grow with your business?
        Mr. Swenson-Klatt. Thank you. As I mentioned, I am
    partnering with a housing program. It is a housing program that
    houses young adults who have been homeless, 18- to 24-year-
    olds. And, in that population, as we work with them in
    internship programs, you can tell there is a lot of health
    disparities at work. So we are the kind of place that is
    supportive. We create flexible schedules. We do the extra
    little mile to help someone with a rough day, that leave time
    in many cases, a chance for a person to just take care of
    themselves.
        Mental health issues are a huge piece of young adult
    experience right now. If the pandemic isn't kind of a wake-up
    call, we should be aware. I have a lot of young adults who work
    for me for whom it has been a really tough set of years. Mental
    health issues are really challenging. Sometimes you need that
    time off.
        The flexibility that I had during the pandemic to back into
    a program that was available to pay for people to be away
    allowed me to just keep open. I wasn't panicking because I knew
    they were going to keep their job. They were going to come back
    when they are feeling a little better, back on their feet. We
    would be flexible as a staff, support each other and get back
    to where we needed to be. That kind of predictability for my
    staff and for me means I can just keep going forward. Before
    that, it was very hit or miss. And I just miss those--that
    possibility again. I don't look forward to the days when it
    is--someone needs a couple weeks, and I just have no way to
    support them. And, in a couple weeks, for the young folks I
    work with, that is rent; that is food. It is back into the
    instability.
        Representative Pocan. Thank you, Mr. Chairman. I appreciate
    your time.
        Chairman Beyer. Thank you very much.
        I recognize the gentlewoman from Washington, Ms. Herrera
    Beutler.
        Representative Hererra Beutler. Thank you, Mr. Chairman.
        And, just to clarify of our last witness, I just want to
    make sure I understood that correctly. The ability to do the
    paid family leave and to provide the sick leave or just mental
    health time for your employees was as a result of the payments
    because of the COVID replacement money, correct?
        Mr. Amarnath. Yes.
        Representative Hererra Beutler. So you weren't able to
    provide that prior to the pandemic. Okay. Thank you. I wanted
    to clarify that. Paid family leave, childcare is something I
    have actually worked on quite a bit here in Congress. I believe
    we need to find ways to address this issue. Whether we like it
    or not, it is something we need to address.
        But I also am challenged because it is also true that money
    comes from somewhere. And it is not all--you know, I believe in
    investing in children, but not all investments are the same.
    You know, people talk about pre-K, and pre-K is important, but
    the quality of the pre-K is really the thing that makes the
    difference when you talk about getting $7 back with a $1 in. It
    is not just warehoused childcare; it is investment in children.
    So I do want to make sure we are not blanketing that.
        And, you know, I supported the legislation last year
    strongly to replace--really, when private companies got shut
    down because of a public interest--the Federal Government or
    the States or whatever shut you down because we were trying to
    protect people against this pandemic. It was through no fault
    of your own that you were getting shut down. And so that relief
    payment to me was similar--I compared it to eminent domain,
    like when there is taking of private property for a public
    good, there needs to be just recompense, and that is how I
    viewed that.
        As we move forward in the policy, we are not in that
    situation anymore. And I am all for innovative ideas and
    solutions that help us get to where a small or midsize business
    can compete for that labor force by offering robust benefits.
    But the Build Back Better plan has frustrated me because it is
    not innovative or creative. It is just ``let's tax more and
    spend more.'' Well, that doesn't last.
        And I do think what we saw, I was here pre--during the
    Obama years and Trump years. And I remember during the Obama
    years being told we are never going to grow again, like, our
    economy is never going to grow. I think, when he left office,
    we were at 1--1.6 percent GDP growth. And we were told we will
    never see a 3-percent growth again in our economy; those days
    are gone. And, bam, we cut taxes, much to a lot of people's
    frustration, and we saw real wages grow among almost every
    recorded class, right? In fact, higher among American people
    who were new to the workforce, like lower wage workers,
    minorities. I mean, single mothers saw more money back. So I do
    think there needs to be a more creative approach than just
    ``let's throw more money at it.''
        Having said that, and, Ms. Greszler--I am probably
    butchering that, and I am sorry. Mine gets butchered all the
    time. I wanted to ask about small businesses and their impact
    and supply chains. Now I know, I think in your testimony, you
    talked about union impacts in terms of, like, supply chains,
    but what are the things that we can be doing to help businesses
    on the regulatory end or the supply chain end so that they are
    not wasting time and money on that and maybe they have more
    flexibility with their employees? Could you speak to that?
        Ms. Greszler. Yeah. That just has to do with breaking down
    those barriers and getting rid of regulations that are in the
    way of preventing employers from doing what they would
    otherwise do, being able to work directly with their employees
    and to be able to get things moving. Getting enough people into
    the door and who are willing to work to begin with.
        And, if I could just briefly comment on the whole childcare
    and paid family leave because I do think that, across the
    board, we want to be helping people who are in need. And we
    want to be helping them in a way that lifts them up. And
    absolutely people should have access to paid family leave, and
    childcare is very important. But, if the goal is it to help the
    people who are in need, then why is there a proposal that is
    going to use most of the money for paid family leave to pay
    employers who are already providing it to keep providing it?
    That is not going to help small businesses because that is
    going to let those employers otherwise further increase their
    wages. And, if we care about childcare, why do we have a plan
    that is going to give a couple in D.C. that makes $340,000 a
    year $30,000 worth of childcare subsidies? That is not helping
    anybody enter into the labor force.
        Representative Herrera Beutler. Is this helping people in
    southwest Washington----
        Ms. Greszler. No.
        Representative Herrera Beutler. Who don't make $300,000
    plus a year, who don't have college degrees but are still
    making it work, still need help. You are right: it is diverting
    assets.
        Ms. Greszler. Exactly.
        Representative Herrera Beutler. Be creative.
        Ms. Greszler. Let's look at the existing funding that is
    out there for--Head Start is one example, $10,000 per year. Why
    not let families take that to a provider of their choice? And I
    did just want to briefly challenge this notion about these 8 to
    9 percent returns. That is a tiny boutique study six decades
    ago. And, even the author of that study, he said, yes, there
    are 8 to 9 percent returns for particularly disadvantaged
    children, and he said: But you know what hasn't been estimated
    very well is the return of investment of a parent in a child?
    He said: If I had to guess, that would be a 30 to 40 percent
    return. And so anything I would say, please, don't make us look
    like Quebec because, yes, they significantly increased the
    labor force participation of mothers with young children, but
    they did it at the expense of children and families. They had
    terrible outcomes in terms of social, mobile abilities, health
    outcomes, worst parenting outcomes, even higher crime rates
    when those children were teenagers. That is not something we
    want to mimic.
        Representative Hererra Beutler. Thank you.
        My time has expired. I appreciate it, Chairman.
        Chairman Beyer. Thank you very much.
        I now recognize the Congresswoman from Columbus, Ohio, Ms.
    Beatty.
        Representative Beatty. Thank you, Mr. Chairman.
        And thank you to our witnesses today.
        Sitting here trying to digest and listen to a lot of
    scientific, practical, somewhat biased opinions, as well. We
    have heard a lot about the Build Back Better and what it will
    or won't do. And childcare, I do agree with my colleague that
    we should make an investment in our children. And here is what
    I know: Depending on where you live in this wonderful America
    in raising your children, it is about quality childcare. And
    what I do know is, if you can't afford quality childcare to
    make an investment in it, then most mothers, parents, fathers
    will put their children before anything else. And then they
    won't be able to go to work.
        If we are talking about the economy and growing the
    workforce, we have heard a lot about the vaccination, Mr.
    Chairman. And, when people talk about the OSHA ruling of
    employees who have 100 employees or more and the mask, wearing
    the masks, it is ``or be tested every week.'' And I can tell
    you a major hospital in my district said it was worth every
    penny that they had to spend on the test because keeping people
    healthy allows them to go to work.
        So, if you are not tested and you don't know--we had this,
    in this very Chambers, people touting that they weren't going
    to wear a mask; they weren't getting vaccinated. Some of those
    same people then tested positive and affected other people.
        And then what I do know is, if you miss 10 or 14 days of
    work on some jobs, you will lose your job.
        Here is the other thing I know: For us to talk about the
    economy and talk about vaccination and not wearing a mask or
    thinking that the President shouldn't be agreeing with this
    rule, let me remind you, I went out there to the National
    Cemetery: 700,000 people have died because of COVID-19. You
    want to talk about the economy and talk about whether we should
    wear a mask or be tested? 700,000 people have died. We want to
    talk about looking like Quebec and what we are going to do? And
    we come in this hearing and question and challenge the
    difference between being tested or wearing mask and what it
    does? Clearly, you know I have some feelings about that,
    whether practical or scientific, people are dying. Thank
    goodness we have an OSHA ruling that says wear a mask or be
    tested.
        So we know that, as we talk about the Build Back Better
    plan, which I think is bold--I think it is visionary, and I
    think it is going to make a difference in how we grow the
    economy, how we balance an investment in our communities and in
    our Nation. We talk about the economy. So let me go to a
    question. Mr. Skanda Amarnath.
        Mr. Amarnath. Yes, Skanda.
        Representative Beatty. Okay. And also Dr. Stevenson.
        I have a question, and I will start with you Mr. Amarnath.
    In your testimony, you focused on the benefits of tight labor
    markets and how that can have an effect on witnesses. I wanted
    to ask you about the impact of a tight labor market and what it
    would have on the racial gap in the unemployment rate.
    Historically, we know that Black Americans' unemployment rate
    is double the unemployment rate of our White Americans. How do
    you think or what do you think about the tight labor markets
    effect on the racial gap in unemployment and what policies can
    break this cycle?
        Mr. Amarnath. Thank you. So I--the gap between unemployment
    rates and the gap between, called employment rates, employment-
    to-population ratios, White persons to Black persons, there has
    been this sort of complacency systematically to say, oh, the
    gap is structural in a way that we can't influence through just
    ordinary fiscal policy, monetary policy, just whatever Congress
    can do. There has to be some sort of secret to unlocking that.
    But, actually, as we find, this is a very cyclical process. So,
    as you get the unemployment rate lower, as you get the
    employment rates higher, it actually benefits most particularly
    those who are--who have been systematically and structurally
    marginalized. And so we see that Black employment rates rise
    relative to White employment rates. We have actually seen that
    they are getting closer and closer [Inaudible] Black employment
    to population ratio and White employment to population ratio.
    And we have to--if we really want these gaps to converge, we
    are going to have to keep investing and keep sort of taking an
    affirmative approach to make sure we are growing the economy
    and bringing in those people who tend to be the first ones laid
    off during recessions and kind of cruelly marginalized and only
    brought back very slowly typically.
        So I think it is important for us to keep this recovery
    going as fast as we can so they can bring back those people.
        Representative Beatty. Thank you. My time is up, but thank
    you because I think that also supports the Build Back Better
    plan.
        And, Ms. Stevenson, I just want to say thank you for
    allowing us to take a look at the challenges that we are having
    in childcare. And I certainly agree with you that it will have
    an impact on our employment.
        Thank you. And I yield back.
        Chairman Beyer. And, Ms. Beatty, if you care to stay for a
    second round, we will probably pursue that in another 10
    minutes.
        And now let me recognize the distinguished Senator from
    Arizona, Senator Kelly.
        Senator Kelly. Thank you, Mr. Chairman.
        Mr. Amarnath, thank you for testifying here today. Thank
    you to all of you for being here.
        A few months ago, I helped to craft the bipartisan
    Infrastructure Investment and Jobs Act, which passed the Senate
    in August. And I hope to see it pass the House soon. This is a
    good bill. It makes historic investments in our Nation's
    critical infrastructure, improving our roads, bridges, drinking
    water, ports of entry, and other things. All of these
    investments are going to create millions of good-paying jobs.
    Many of them require high skills. Many of them are technical.
    We need to make sure that people have these skills to fill
    these jobs, especially since, as we have heard today, there are
    jobs already waiting to be filled.
        Could you talk about the benefit of investing in training
    programs to ensure workers have the skills they need to fill
    newly created jobs and how to best utilize these programs to
    help with the skills mismatch that we are facing right now?
        Mr. Amarnath. So I think the investments in workforce
    training, especially in this increasingly tighter labor market,
    are especially essential because these are in industries that
    had a very long period of, call it, very cool underinvested
    period. Think about construction, for example, as being an area
    where construction jobs were abundant before the Great
    Recession. And then we had a sort of long decade in which we
    did not see the sort of requisite employment and investment.
    And so now we are faced with shortages in construction,
    manufacturing, maintenance jobs. These are areas of blue collar
    work that is also being--that we may have some level of
    persistent investment to be able to ensure we have a workforce
    that is stable and able to actually address the challenges of
    an economy that is recovering, and there obviously are sort of
    growing pains right now. We see supply chain problems,
    logistics, bottlenecks. And part of the challenge here is we
    need to sort of rise to the occasion of being able to bring in
    a record amount of goods through our ports, be able to produce
    a record amount of goods within the U.S. economy itself. And so
    I think that is going to be critical to have that force to make
    sure that we have the capacity going forward and that the
    growing pains we see now are not growing pains we are going to
    see in subsequent years, that we actually do have the capacity.
    We do have the workforce that is tailored to meeting the
    material needs of our citizenry.
        Senator Kelly. How do we build that capacity?
        Mr. Amarnath. I think that part of it has to be a
    combination of identifying those areas of--especially I think
    construction and manufacturing are most instructive, where we
    do see both evidence--people talk about job openings. We are
    also seeing wage growth has also picked up in those areas. We
    have also seen that there is an attempt to at least hire
    aggressively, but it is not necessarily easy to hire people who
    have oftentimes moved to other sectors over time, and we need
    to draw them back in. And the training costs especially are--if
    we can burden share on that, especially within the government
    and the private sector, it would actually be beneficial to both
    sides ultimately to able to have a trained workforce. And these
    are very specified skills for these industries, and it is not
    necessarily the case that, if we kind of let a big recession
    and not even try to attempt to have a strong recovery, those
    jobs won't be in demand to the same degree. And that is part of
    the reason we got to this point where we do have labor
    shortages, is that we have kind of systematically not taken as
    affirmative a set of ambitions around sort of fiscal policy and
    especially around infrastructure investment.
        Senator Kelly. Do you think we can, assuming we get this
    legislation passed, get programs funded where we are poised to
    spend hundreds of billions of dollars on critical
    infrastructure, do you think we could build the workforce we
    need to complete these projects?
        Mr. Amarnath. I think so. I think it is a worthwhile
    investment, especially when you are not just from--people want
    to work, and there are a lot of businesses in these sectors who
    now see a very clear need to hire. And there obviously are
    frictions. That is an area where government can do a lot of
    good for both sides.
        Senator Kelly. In Arizona, we have incredible community
    colleges and workforce training programs. And, you know, these
    programs can build the workforce that we need. It is just a
    matter of finding the individuals, getting them through the
    door, getting them the training they need, getting them
    connected with the employers. I think we can do this. I do also
    think that we, like anything, we need to have a plan.
        Thank you.
        And, Mr. Chairman, I yield back the remainder of my time.
        Chairman Beyer. Senator, thank you very much.
        Now I want to recognize the Senator--I don't know if he is
    the senior Senator, but he got more votes from Georgia, Senator
    Warnock.
        Senator Warnock. Because my last name begins with a W and
    Senator Ossoff's begins with an O, I am the junior Senator.
    Imagine that.
        Thank you, Chairman Beyer. And I am glad to be here to be a
    part of this hearing.
        People have had to make really hard decisions throughout
    the pandemic when it comes to their jobs and protecting
    themselves and their families and their communities. I don't
    think we have taken stock really of the trauma visited upon all
    of us at varying levels as a result of this pandemic. And not
    everybody has had the privilege of working remotely. I think
    especially about our essential workers. That is a term that
    emerged during the pandemic, the people who literally risked
    their lives stocking grocery store shelves and working in other
    facilities, in hospitals, in some cases.
        We call them essential workers. Often they don't make an
    essential wage. They don't earn essential benefits. Leading
    into the pandemic, only about 9 percent of the lowest wage
    earners in the country were able to work from home.
        Dr. Stevenson, can you speak to how policies that support
    the financial freedom of working families like the child tax
    credit, the largest tax cut for working families in American
    history, how this might affect the growth and stability of the
    labor market?
        Dr. Stevenson. Yes. Thank you for that question. I mean--I
    think the most important thing that the child tax credit does
    is eliminates or dramatically reduces the amount of children
    living in poverty. And what that does for children is ensures
    that they eat better, that they learn better, and that they are
    better able to grow into adults who will ultimately be
    productive.
        But it also gives a little bit more flexibility to the
    families to make the right choices for them. Families shouldn't
    be stuck in a situation where, if something happens, we have
    all been there, where a kid breaks an arm or a leg, and you
    have to keep going to work, but who is going to take care of
    them?
        Giving them just a little more breathing room allows them
    to make better decisions. And we saw in the pandemic that
    people got up and went to jobs that could kill them, but the
    financial support we gave has allowed them to move into better
    jobs as we have emerged out the pandemic, to make requests for
    higher wages, for more flexibility.
        Flexibility doesn't just mean working at home. It means
    knowing what your schedule is more than 24 hours in advance so
    you can plan for childcare. It means trying to ask for working
    around your childcare schedule so that you can actually go to
    work and do your job. These kinds of demands that workers are
    now currently making are being facilitated by the fact that
    you, Congress, in its wisdom has chosen to give a little bit
    more of a cushion to families so that they can make better
    choices for them and their children.
        Senator Warnock. Families for whom wages are low and the
    cost of childcare is high.
        Dr. Stevenson. Yes.
        Senator Warnock. And this just gives them some space. So
    you don't believe this is a negative impact on the economy.
        Dr. Stevenson. I do not believe it is an negative impact.
    In fact, I think it is a very strongly positive impact on the
    economy. I think that most people want to be able to work,
    provide more for their children, but they need a little bit of
    a buffer because, when things start to fall apart, what we see
    is people can have a really hard time getting themselves out of
    the worst situations. So that is particularly true for low-wage
    workers.
        Senator Warnock. And, similarly, we have heard folks in
    recent days say that the unemployment insurance that we
    provided is what is contributing to this issue. And some have
    argued that taking away unemployment payments was necessary to
    get people back to work. But the evidence that I have seen
    isn't there. In States like Georgia, that ended benefits early,
    there was not a significant difference in the number of jobs
    created in comparison to other States that kept the benefits.
    Further, a report by the Federal Reserve Bank of Atlanta found
    that even though women--women with small children made up just
    10 percent of the prepandemic workforce; they are almost 25
    percent of the COVID-related job loss. So these are folks who
    are responding to this very issue that you are talking about.
    It is not that parents don't want to work. Raising a small
    child--and I have two small children--during a pandemic without
    reliable childcare or other supports is a full-time job, and it
    makes it nearly impossible to work.
        Mr. Amarnath, does limiting Americans' access to financial
    support increase our overall economic growth?
        Mr. Amarnath. I think it quite clearly is the opposite from
    the past 18 months. We have some pretty clear data about how
    income supports ultimately preserve consumption, preserve jobs,
    preserve the ability for businesses to stay open and not have
    to go. And that is true especially from the household side with
    unemployment insurance.
        So there was obviously a lot talked about disincentives,
    how this was actually stopping people from entering. And we had
    a few different ways we could actually game out why this was
    actually happening. We decide whether the incentives, how much
    of an effect it was having. We could look at the cutoff in
    September for a lot of States; we actually kept it in place.
    And did job growths speed up as we got closer to September and
    through September? No. If you look at the States--we have
    weekly data for States that cut it off early. Did we see a
    difference in terms how quickly their employment rate
    accelerated through the early cutoff? And we didn't see that
    either. That is a reference to what Dr. Stevenson noted in her
    testimony, that Arin Dube has--from the weekly data, we don't
    see that.
        And then we can also just look at, across the income
    spectrum, did we see that when we gave a fixed payment? Did it
    actually translate into people at the lower end of the income
    spectrum? Did job growth slow for those who are at the lowest
    wage level? That we didn't see either.
        So we have all these different ways to triangulate and
    actually evaluate this. And I am sure there are obviously ways
    we can keep going back and forth, but on the other side of
    ledger, that income helped support consumption for a lot of
    people who otherwise would have had to cut back drastically.
    And that is a really important thing, the share of people who
    would have had to face a big financial loss in terms a lack of
    a employment, who didn't have to go through that. There is
    pretty clear data, J.P. Morgan has evaluated people's financial
    balances across the income spectrum. And there are a number of
    people who would have faced a really big financial downturn
    because of the loss of employment that didn't have to. And that
    meant that they could also be engaged in the economic activity
    that was supportive of their own standard of living and the
    standard of living of others.
        Senator Warnock. Thank you so much.
        I often say the right thing to do is often the smart thing
    do as well. And this gives us insight about how to grow the
    economy in a way that embraces all of us, especially
    hardworking middle class people, the working poor.
        Thank you so much.
        Chairman Beyer. Senator, thank you very much.
        Ninety percent of the Joint Economic Committee is just
    showing up. So we are going to do a second round, and you are
    welcome to stay.
        Senator Warnock. They are dragging me to the next thing.
        Chairman Beyer. I understand. So, if my friend, Mr.
    Schweikert, comes back or anyone else, we would be happy to
    welcome them.
        Let me just start a short second round.
        Dr. Stevenson, there was a Heritage report on September 30,
    just 7 weeks ago, that said, quote: ``The proposed subsidies
    for full-time center-based childcare would arguably subtract
    from the benefits of a loving resourceful family by reducing
    parenting and increasing paid time in the labor force,
    particularly for mothers.''
        At the same time, Ms. Greszler talked about the child tax
    credit, the $250 and $300 payments are unfortunate because they
    have encouraged mothers, parents to go back into the workforce.
    You are a mom of two. Should that loving resourceful family be
    reserved just for wealthy families?
        Dr. Stevenson. I appreciate you asking that question, and I
    feel strongly no. It should not be reserved just for wealthy
    families. There is, obviously, a strong back and forth between
    a desire to encourage work, which I think we are all in
    agreement--everybody here wants to see people who can work,
    work. But there are times when parents do need to be at home.
    What we are looking at is making childcare affordable so that
    parents can make the right choice for themselves.
        And I think there are a lot of parents that, unfortunately,
    find themselves in a situation where childcare is so
    unaffordable that they are unable to do it. Center-based
    childcare is not just been childcare; it is also about
    learning. The pandemic has shown us that learning and childcare
    are two sides of the same coin. When we send our kids to K
    through 12 education, we are not just sending them to learn, we
    are also sending them to someone else who is going to be taking
    care of them while we work. Center-based childcare also
    provides both early learning and care that allows parents to
    work.
        I think the subsidies there give parents a choice. They
    don't force anyone to do anything, unlike a work requirement on
    child tax credits.
        Chairman Beyer. Thank you.
        Mr. Amarnath, you talk about the skills gap myth that the
    differential in unemployment rates between those with a college
    education and those without has actually narrowed over time.
    But we have been talking about the skills gap for a long time,
    you know, the 10 million jobs, 7 million whatever people out of
    work because they don't have the right things. Can you explore
    that?
        Mr. Amarnath. Sure. So a little bit of a nuance, but I
    think when we look at college employment rates and those of
    high school diploma, there is a differential and people say
    that is something that is so structural there is no way to be
    able to get past a certain level of employment for those who
    don't have beyond a high school diploma. And this was
    especially a prominent argumentation command of the Great
    Recession that all these construction workers can't be employed
    doing something else unless it takes a lot of time and cost,
    and it is going to create a lot of inflation.
        As we saw in 2015 onwards, that that gap narrowed. And that
    gap narrowed as the labor market tightened, and there was--
    demand had slowly recovered whereas, right now, we see,
    especially when we are kind of going into overdrive with the
    current recovery relative to those previous recoveries--we can
    benchmark it against that--we do see that there is a demand for
    a lot of that type of labor that has been highly cyclical, that
    was probably not as stable a job previously, and we are trying
    to make a lot of those essential jobs, whether they are
    manufacturing, construction, maintenance--these are areas where
    there has been a lack of stability over the years, and that is
    part of the reason that those jobs may have been otherwise done
    by people who did not have a college degree, could be good
    paying jobs under the right conditions, especially now if we
    sort of subsidize training, are able to actually bring people
    in. So I think the skills gap itself is a prediction of who is
    employed and who is employable. There is obviously a role
    government can play in facilitating that process, but the
    notion that this is some hard constraint as opposed to
    something that we can work through, I guess that is the way I
    would frame it from here, which is there are areas where there
    is probably room to do more. But these are always challenges
    that always exist that, at some level, persistent effort can
    bring people in. And we shouldn't write off people just because
    their educational attainment levels are different or only the
    people with a college degree are somehow able to find gainful
    employment that pays a good wage.
        Chairman Beyer. This ties in really nicely, although
    uncertainly, with the whole notion of retraining workers. In an
    economy where we celebrate creative destruction, whether it is
    driven by technology or by trade or anything else, what do we
    do with those coal workers in southwest Virginia, for example?
    It is a challenge.
        Mr. Amarnath. I think in the case of--there is a tendency
    to sort of say that people have to switch from drastically into
    new jobs, somehow people have to go learn to code or
    construction workers need to become nurses, which was a common
    claim in 2010 and 2011.
        Actually, I would take strong issue with that. And we are
    seeing that part of the reason is we did not take the recovery
    seriously enough the last time around, at least into the
    policies that were implemented. And, this time around, we are
    seeing that there are job openings in a lot of these areas that
    were supposedly written off. Manufacturing jobs are actually in
    high demand right now. And that is a product of how we actually
    craft policy, but they create the demand and the supply for the
    workforce itself that support it. That is important.
        Chairman Beyer. Thank you.
        Dr. Stevenson, there is a fascinating article in today's
    Atlantic by Derek Thompson on this exact subject. And he talks
    about how the ``great resignations,'' quote-unquote, seem to be
    accelerating, along with the remote work revolution and the
    knowledge economy. But let me quote directly. I would love your
    thoughts on this, especially with your Council of Economic
    Advisers background. Quote: Much of the labor force seems to be
    participating in a kind of distributed protest against the
    status quo of work in America, and, quote, this may be a
    pivotal turning point in the relationship between labor and
    capital.
        Is all this overstated?
        Dr. Stevenson. I don't think that it is overstated. You
    know, the labor's share of income has been declining for the
    last 20 to 30 years. When I was a graduate student, I was
    taught that that thing is stable, that it never changes, that
    what workers get is always sort of roughly the same share, even
    as GDP grows. And yet we have seen this decline that has been
    function of big companies that rely on less labor becoming a
    greater share of the economy and workers with low skills being
    treated really like they are disposable. What we see, you know,
    if you look at the industries that are hurting the most today,
    those are the industries that tend to have very, very high
    turnover in the best of times and not just because workers are
    quitting but because they let them go.
        ``Oh, there is no demand; don't can come in today.''
        ``But I was on the schedule; I arranged childcare.''
        ``It doesn't matter; we don't need you.''
        That kind of treatment workers have been putting up with
    for a long time. When I was on the Council of Economic
    Advisers, we brought together employers and software
    manufacturers who made scheduling software and said, what is
    going on? Why can't you just make shifts work a little bit
    better for people so that they can plan their childcare better?
    And the response from the software developers was: ``We can if
    that is what employers want.''
        So the employers have to want it. And the way for them to
    want it is to find they have to work a little bit harder to get
    workers. And that is what we are seeing in the labor market
    today. And that collective movement, in effect what I have
    called a national collective bargaining moment, is leading
    workers to demand more and get more.
        Chairman Beyer. Thank you very much. Anybody else want--I
    am just kidding--in any case, thank you very much.
        Ms. Greszler, Mr. Swenson-Klatt, Mr. Amarnath, Dr.
    Stevenson, I really appreciate you hanging in.
        We are going to get thrown out of the room in 11 minutes. I
    am really grateful. It has been a wonderful discussion, and we
    actually had many people here for their 5 minutes, which was
    very helpful.
        So understanding how create a policy environment that
    encourages the creation of well-paying high-quality safe jobs,
    including all the perspectives, it is a really critical issue
    for Congress, for business, for workers. The pandemic certainly
    has highlighted some of the structural challenges holding back
    labor force participation. And the current demand for strong
    workers gives us an opportunity to really explore this and get
    people back into the labor force.
        Thank you for your contributions. Thank you to my
    colleagues.
        The record will remain open for three business days, and
    this hearing is now adjourned.
        [Whereupon, at 4:50 p.m., Wednesday, October 27, 2021, the
    hearing was adjourned.]

                           SUBMISSIONS FOR THE RECORD

             Prepared statement of Hon. Donald Beyer Jr., Chairman,
                            Joint Economic Committee
        One of the most important things we can do as a Congress is to help
    build a policy environment that encourages the creation of well-paying,
    high-quality, safe jobs. Jobs that allow Americans to support
    themselves and their families. To create opportunities that provide
    workers both a steady paycheck and the ability to care for loved ones
    when they are in need.
        Ensuring workers can navigate work and care responsibilities is
    crucial to boosting overall productivity and advancing long-term and
    robust economic growth which benefits all of us.
        The purpose of this hearing is to examine the barriers to labor
    force participation why it is that certain workers have been unable to
    rejoin the workforce and how policymakers can help address this trend.
        Despite the strength of our Nation's ongoing recovery in which the
    pace of new jobs created has been steady and robust, with almost 5
    million Americans returning to work under President Biden the uneven
    return to the workforce we are witnessing raises some concerns. It is
    particularly troublesome to note that women comprise nearly two out of
    three of the workers who have dropped out of the labor force since the
    beginning of the pandemic.
        To understand the current situation, it is useful to look at
    preexisting trends in U.S. labor force participation: After increasing
    dramatically over the second half of the 20th century, women's labor
    force participation peaked in 2000, and has declined since then. The
    reason for much of this decline has been the lack of structural support
    for women's full participation in the economy, such as paid leave and
    affordable and accessible child care.
        The pandemic highlighted these underlying structural challenges
    confronting our care infrastructure. Women remain the members of their
    families most often responsible for a greater share of care work.
        Now, facing the burden of inadequate and unaffordable child care,
    the impossible choice between caring for a sick loved one or getting a
    paycheck, or pandemic-related disruptions of schools, many women have
    been unable to return to the workplace. If we do not take action to
    better support women returning to work, we may experience prolonged
    periods of worker shortages that will hurt our Nation's economy.
        As a small business owner for over four decades, I have seen first-
    hand how paid leave is important for supporting both small businesses
    and workers. It is inevitable that workers need to take time off to
    care for themselves or for a loved one, but only 23 percent of American
    workers have access to paid family leave. Unfortunately, the lower-wage
    workers who are least able to afford to take time away from work to
    care for a sick child or relative are also the workers least likely to
    get paid leave from their employer. A universal paid leave program
    would allow parents to look for work with the knowledge that they could
    care for their kids without losing their paycheck. It would also allow
    employers to be able to retain experienced workers who need to take
    leave without having to pay for the leave out of their own pocket.
        The good news we can take from the current strong demand for
    workers is that we know from the recent past that when there is strong
    demand for workers, they do return to the labor force. Under President
    Obama, the U.S began the longest period of continuous job growth in
    modern history. The tightening of the labor market created
    opportunities for millions of previously marginalized workers to rejoin
    the workforce, and drove up wages, particularly among lower-wage
    earners.
        So while the coronavirus pandemic rocked the labor market and
    pushed the labor force participation rate to lows not seen in decades,
    the hot labor market before the coronavirus pandemic demonstrated that
    sidelined workers can be brought back into the labor force. This offers
    us a useful example as we look to address the current challenges facing
    workers.
        But as helpful as the strong demand for workers can be in pulling
    people back into the labor force, we have seen that if we want to make
    a meaningful improvement in labor force participation we must address
    existing gaps in workforce supports that help workers navigate both
    their jobs and care responsibilities.
        Workers have made significant progress in the past year, with
    almost 5 million Americans returning to work under President Biden and
    the unemployment rate dropping to 4.8 percent in September, beating
    expectations. Nonetheless, there is significant turbulence in the labor
    market. It is incumbent on this Congress to examine and act on policies
    that make it possible for Americans to maintain work responsibilities
    while ensuring the well-being of their loved ones.
        I am looking forward to learning from each of our witnesses today.
                                   __________
              Prepared statement of Hon. Mike Lee, Ranking Member,
                            Joint Economic Committee
        Throughout the history of this great country, Americans have worked
    to build businesses, employ workers, and support families. Through
    work, we have developed new ideas that bettered our own lives and the
    lives of our neighbors, our communities, and our country.
        When work is no longer part of our lives, we lose something
    fundamental to our ability to contribute and to thrive. Work is more
    than just a source of income, work connects us with each other and
    connects us with a purpose greater than ourselves.
        But today, work is in crisis in America. Millions of Americans have
    fallen out of the workforce since the onset of the COVID pandemic,
    workers are quitting their jobs at unprecedented rates, and labor
    unions are striking as demand for labor continues to grow.
        September's job report shows the smallest gain in payrolls this
    year, and nearly five million Americans are still on the sidelines.
    Across the country, there are more jobs than there are willing workers.
        The current employment situation should concern us all. But
    declines in labor force attachment actually precede the pandemic.
        In a new report this week, Joint Economic Committee Republicans
    evaluate the years-long question of why so many prime-age, able-bodied
    Americans have fallen out of the workforce. For men, connections to
    work have been declining for decades and hit a record low last year
    with the onset of the pandemic recession. For women, connections to
    work started receding in the last two decades.
        Our report finds that government programs and policies are making
    work less attractive, and that many Americans are voluntarily
    disconnected from work.
        That is a problem for our economy and our social fabric.
    Fortunately, there is a lot we can do to reconnect people to work. To
    begin with, we must address existing policy.
        Over the past 18 months, Congress increased safety net benefits and
    left those new and expanded programs in place for too long. Congress
    authorized unemployment checks that were sometimes twice as large as
    Americans' paychecks, and provided rent subsidies, stimulus checks,
    loan forbearance, new health care coverage, and expanded food stamps.
    Importantly, most of these benefits did not require recipients to look
    for work, even after vaccines were widely available to protect workers
    and businesses began reopening and hiring workers again.
        Current legislative proposals would make many of those anti-work
    incentives permanent, which is the wrong choice. Instead, Congress
    urgently needs to implement policies that draw disconnected Americans
    off the sidelines and into the workforce.
        Congress must remove disincentives to work by strengthening work
    requirements in safety net programs for able-bodied workers. We should
    also eliminate existing barriers to opportunity, like occupational
    licensing and labor regulations that prevent many Americans from
    entering new professions or working flexibly on their own terms.
        Finally, the Federal vaccine mandate is an obstacle to connecting
    people to work, and there is no legal or constitutional authority for
    it. The threatened employer mandate has not even been issued yet, and
    Utahns tell me that it is already jeopardizing their livelihoods and
    that unvaccinated workers are preemptively being put on unpaid leave
    which leaves them without a source of income yet ineligible for
    unemployment benefits.
        Under the mandate, some Americans would be forced to make a
    personal health decision against their will or face losing their job.
    This ultimatum to workers is unacceptable and immoral.
        Note that opposing the mandate is not the same as opposing the
    vaccine, and I do believe that the vaccine helps increase safety and
    security as we return to our places of work.
        But today, we need workers' contributions more than ever, and we
    cannot pretend to know what is good for every worker or business. We
    must put trust back in individuals, business owners, and local
    decisionmakers. We must stop making policy decisions that discourage a
    return to work.
        Reconnecting Americans to work is one of the most important policy
    goals of our time. I look forward to today's conversation on this
    essential topic.
        Thank you.
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

         Articles for the record submitted by Representative Schweikert
        1. The Anti-Poverty, Targeting, and Labor Supply Effects of the
    Proposed Child Tax Credit Expansion
        https://bfi.uchicago.edu/wp-content/uploads/2021/10/BFI--WP--2021-
    115-1.pdf.

        2. Which States Are Driving U.S. Employment Growth?
        https://www.stlouisfed.org/publications/regional-economist/fourth-
    quarter-2021/which-states-are-driving-us-employment-growth#authorbox.
                                   __________

                  Prepared statement of Senator Amy Klobuchar
        I'd like to give a warm welcome to a fellow Minnesotan, Mr. Dan
    Swenson-Klatt. Dan runs a fantastic cafe in Southwest Minneapolis that
    is a ``can't miss'' destination if you are in the area.
        As you will hear in his testimony, Dan's Butter Bakery Cafe is a
    community-oriented, family run cafe that is finding innovative ways to
    support their employees with fair wages and paid family leave.
        What you may not hear today, is the incredible work that Dan does
    in the Minneapolis community. Since their founding over 15 years ago,
    the team at Butter Bakery Cafe has served as mentors to youth who have
    been homeless or are at risk of being homeless. Their unique service-
    oriented business model is built around partnerships with area schools,
    artists, musicians, churches, and neighborhood organizations to promote
    community engagement--all while serving some of the best breakfast food
    in the city.
        Thank you Dan for being here testifying today, your work is
    inspiring, and the city of Minneapolis is a better place because of
    your efforts.

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