LINDA WERTHEIMER, host:
It's MORNING EDITION from NPR News. I'm Linda Wertheimer.
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And I'm Steve Inskeep.
The government is expected to announce tomorrow that the job market shrank again in July. Employers are still laying off workers, but that would not matter quite so much except for the trend we are following this morning. Companies that might hire some of those laid-off workers are not. They are creating fewer new jobs. As NPR's Frank Langfitt reports.
(Soundbite of door opening)
FRANK LANGFITT: Joey Rosenberg is wrapping up the lunch shift. He is a waiter at Seibel's, a Maryland restaurant. He pours pepper into a shaker and sweeps the dining room floor.
(Soundbite of sweeping)
LANGFITT: In fact, since the recession began, Rosenberg seems to be doing a bit of everything.
Mr. JOEY ROSENBERG (Waiter): You're pretty much doing, at any given time, more than two jobs. Like today, we didn't have a busser, so I was bussing all my tables and everything.
LANGFITT: Tomorrow, Rosenberg, who is 21, shifts from waiting tables to working the register. The reason is simple: Seibel's has 10 fewer workers today than it did at the beginning of the recession, so the remaining staff is picking up the slack.
Is it working with fewer people?
Mr. ROSENBERG: I think yes, it's working. It's more stressful, but its working.
LANGFITT: Since December 2007, the labor market has seen a net decline of six and a half million jobs. And what's happening at this small, family-owned restaurant just north of the nation's capital is happening in workplaces across the country. Instead of replacing workers, employers are operating with leaner, more efficient staffs. Lynn Martins is a co-owner of Seibel's. She says the smaller workforce saves the restaurant $4,000 in payroll each month. That's a big help to the bottom line at Seibel's, but tough for anyone who might want a job there.
Ms. LYNN MARTINS (Co-Owner, Seibel's): We probably stopped giving out applications a good two months ago. We were probably having four or five people a day coming in.
LANGFITT: Job openings around the nation have plunged by more than a third in the last year, according to the Bureau of Labor Statistics. In real terms, that means there were about 1.5 million fewer job openings in May than the same month a year earlier. Lynn Martins says that until the economy turns a corner, she's reluctant to add workers.
Do you have any plans to do any hiring any time in the future?
Ms. MARTINS: No. Looks like we're going to be able to make things work with the crew that we have. There's one employee that's been working for me that just left and moved to Ireland, and I don't think I'm going to replace her.
LANGFITT: For the labor market to rebound, not only do employers have to stop laying off so many people, they've got to start hiring a lot more. Lawrence Katz, a labor economist at Harvard, says that's going to take time. The average workweek is now just 33 hours, the shortest on record. Katz says many people on short hours are waiting for the economy to pick up so they can work more.
Mr. LAWRENCE KATZ (Harvard University): Even when some employers, you know, start seeing improvements in demand for their product, they still have plenty of ability to increase the hours of their existing workers before they need to start hiring new workers.
Ms. CATHY PAIGE (Vice President, Manpower): We really think this is going to be a gradual and slow climb out of the hole.
LANGFITT: That's Cathy Paige. She's a vice president with Manpower, the temporary service giant. Paige says that even when the economy improves, some of her clients won't staff back up to prior levels.
Ms. PAIGE: For example, the casinos. We were there recently on a tour, and they don't have people making change anymore. They have machines to do that.
LANGFITT: Paige says another client, a business services company, has responded to the recession by sending more work overseas.
Ms. PAIGE: We've probably lost 30 percent of our workforce there. They called back a few people this week, but, you know, we used to get orders there for two and three hundred people at a time, and now, you know, we consider a big order 25.
LANGFITT: Back at Seibel's in Maryland, the lunch crowd has thinned down. Lynn Martins says she always kept an eye on cost, but the economic downturn forced her to run a leaner business than ever before.
MARTINS: We learned to do it with less people. They learned to cover more territory, they get better at their job, which kind of weeds out needing extra people. And sometimes more is not always better.
LANGFITT: For businesses like Seibel's and others, that may be one of the biggest lessons and legacies of this recession.
Frank Langfitt, NPR News, Washington.
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