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Global Economic Research

Summer Help Wanted

Seasonal jobs went unfilled as temporary foreign workers could not enter the country.

As an eagerly-anticipated domestic tourism season is underway, many travelers are witnessing a constrained economy. Popular destinations are operating with reduced hours; resorts are cutting some of their amenities; and hotels are reducing room cleaning services during guest stays.

A key reason is a dearth of seasonal workers, many of which come from other countries. Temporary, non-immigrant (or Class J) work visas help to satisfy some of the peak demand for seasonal hiring, especially in the hospitality sector. The arrangement is mutually beneficial: Employers can take in workers just when they need them most, while the visiting worker gets an opportunity to live abroad.

All categories of visa issuance fell in the pandemic, which was no surprise as most countries restricted their borders from most foreign arrivals. This year, though local lockdowns were rapidly diminished, border restrictions have been much slower to relax. Depending on their nation of origin, travelers may still be unable to enter the U.S., or may only be able to enter after spending two weeks quarantining in a lower-risk nation.

Immigrants are an important but temporarily absent source of labor.

Though demand for visas grew as the U.S. reopened, visa issuance did not keep pace.  Visa applicants must apply in-person through their local U.S. consular office, many of which are closed due to local lockdowns, accepting applications on an emergency basis only.  The State Department confirmed in April that it had a backlog of 2.6 million visa applicants, including half a million who had completed all paperwork and needed only to be interviewed.

Class J Temp Visa Issuance and Job Openings Rate

A lack of immigrants is a factor keeping job openings elevated. The job openings rate (openings as a percent of total employment) set a new record high in May, but was even more elevated in the accommodation and food service sector, which employs a higher share of temporary workers. As the summer travel season reaches its peak, most potential foreign workers have probably made other plans for this year, and staffing shortages are now the norm. We hope for a revival as borders and State Department offices reopen in the year ahead. Look on the bright side, though: a summer of understaffed attractions is preferable to another summer of cancelled plans.

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Ryan James Boyle

Vice President, Senior Economist
Ryan James Boyle is a Vice President and Senior Economist within the Global Risk Management division of Northern Trust. In this role, Ryan is responsible for briefing clients and partners on the economy and business conditions, supporting internal stress testing and capital allocation processes, and publishing economic commentaries.

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