Wall Street Journal
By Ruth Simon
May 24, 2018
Owners of restaurants, hotels and other seasonal businesses are scrambling for the second year in a row, as limits on visas for temporary foreign workers and a tight U.S. labor market make it difficult to staff up for the summer rush.
Many small-business owners are struggling to fill the gaps. Some have traveled to Puerto Rico to recruit staff, with limited success. Others have had to cut their business hours or delay expansion plans.
“I am still short five line cooks, no matter what I do,” said Peter Hall, the owner of two restaurants in Wellfleet, Mass. Mr. Hall missed out on a lottery used to determine who could hire workers with temporary, or H-2B, visas.
Congress set a cap of 66,000 H-2B visas for temporary nonagricultural workers every 12 months, with 33,000 slots reserved for each six-month period starting April 1 and Oct. 1. The visas last for the short-term period the employer requested and can be extended for up to three years for workers already in the U.S. Businesses typically file a petition requesting a specific number of workers for each job category they are seeking to fill.
The gap between visa supply and employer demand widened last year after Congress declined to renew an exemption for returning workers. That forced firms to request new visas for workers who had come to the U.S. under the program but had left the country after their seasonal employment ended.
For this summer season, businesses filed requests for more than 81,000 workers on Jan. 1, the first day possible, a record. Many of the requests came from tourism-related industries, but landscaping and food-processing businesses also petitioned for many of the visas.
The flow of applications was so great that the Department of Homeland Security, which approves the petitions, was required to use a lottery. Selections were made from the first 2,700 petitions. Finding U.S. workers is particularly challenging in today’s tight labor market, with the unemployment rate at 3.9%, the lowest since 2000.
Small-business owners say the heightened uncertainty about who will get H-2B workers and who won’t makes it difficult to operate. “It’s just the luck of the draw,” said Todd Callewaert, president of Rena’s Fudge Shops, which operates a hotel, six restaurants, three fudge shops and other businesses on Mackinac Island, Mich.
Rena’s brought in 75 employees with H-2B visas from the Philippines and Jamaica last year, but this year its petitions weren’t approved, leaving it with 35 H-2B employees who hadn’t left the country.
The company spent more than $8,000 on a recruiting trip to Puerto Rico that didn’t result in a single hire, contracted with two Florida recruiters and brought on more interns from local culinary schools.
Rena’s also pushed back the opening of three restaurants to Memorial Day weekend from the first week in May. It pulled the plug on plans to take over another restaurant. “We’d love to do it, but we can’t do it,” Mr. Callewaert said. “Who knows what employees we will have. You just can’t plan for the future.”
Congress declined to lift the visa cap this summer, but gave the secretary of Homeland Security authority to issue up to 69,000 more H-2B visas this summer. The Trump administration is expected to make an additional 15,000 visas available this year, the same number it approved last year. But no announcement has been made, even as members of Congress have pushed for quick action.
Last year, the additional workers didn’t arrive until the summer season was nearly over.
Madden’s on Gull Lake, a 300-room resort in Brainerd, Minn., estimates it lost more than $250,000 in revenue last year because it didn’t initially get any of the 62 H-2B visa holders it was counting on. It had to delay opening two of five restaurants and turn away some customers. Twenty-one H-2B visa holders arrived in August.
“Our guest satisfaction rates were down significantly because we didn’t have enough employees,” said chief operations officer C. Ben Thuringer.
This year, Madden’s luck was better and it received visas for all 62 H-2B workers it requested. It also is bringing in more students under the J-1 work-travel visa program and spent $40,000 to expand its dormitories to house an additional 17 workers.
In testimony before Congress in May, DHS Secretary Kirstjen Nielsen called on legislators to set the cap at a level they view as appropriate, rather than shifting responsibility to her agency. “The fairest thing to do for these companies to insure their survivability is to put the number in law,” she said.
A U.S. Citizenship and Immigration Services official said that raising the limit is an “arduous process” that “takes weeks, sometimes months.”
Mr. Hall, the restaurant owner in Wellfleet, said he filed his petition for H-2B workers Jan. 1, but still didn’t get chosen. He has raised wages, spent more for help-wanted ads and, in January, traveled to Puerto Rico with a small group of Cape Cod business owners to interview job candidates.
Paul Moore, the owner of a landscaping business in Eastham, Mass., said he was able to hire three employees on the trip, including one he promoted to a foreman within two months. Two other hires, he said, never picked up plane tickets left for them at the airport.
“I started this process in August,” said Mr. Hall, who was only able to hire one person on the trip and continued to interview applicants this week. “I thought I was set three times.”
Instead, he still doesn’t have enough staff to open up for breakfast and, until this week, was serving dinner six rather than seven days a week.
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