Inflation, Labor Issues Dominate Pennsylvania House Budget Hearing | Pennsylvania

(The Center Square) – Pennsylvania Department of Community and Economic Development officials discussed inflation and staffing issues, as well as the Wolf administration’s decisions to close businesses amid the coronavirus pandemic. COVID-19, during a third day of budget hearings in the House Appropriations Committee.

State Representative Lynda Culver, R-Northumberland, pointed to record inflation figures from the US Bureau of Labor Statistics which showed a 7.5% annual increase in the consumer price index for January , the fastest increase since 1982.

Culver also noted federal stimulus spending and asked Acting Secretary of the Department of Community and Economic Development Neil Weaver about the department’s outreach to understand the effect of inflation on small businesses.

Weaver said department officials were meeting with businesses and communities of all sizes around the Commonwealth, and “we keep hearing there are issues around the workforce, which is the number one issue that we hear again and again.

“Childcare, transportation and training” are other issues, he said. “We have a number of programs in place to help that.”

Rep. Keith Greiner, R-Lancaster, cited a recent National Federation of Independent Business (NFIB) survey that found the net percentage of small businesses raising prices reached 61% in January, up 4% from December, and the highest percentage since 1974. The NFIB measure of business owner optimism is also at its lowest level in 11 years, he said, due to inflation, labor shortages and uncertain economic conditions.

“As we move forward, … what I want to know is what do you think of inflation levels in the PA and how is that going to affect the current atmosphere for small business?” he said. “Small businesses are the economic engine of this Commonwealth.”

Weaver reiterated employee attraction and retention issues as a major near-term problem, due to transportation and childcare issues and an aging workforce, he said. .

“We have a number of reasons why, and those are things we’re working on with our small businesses,” Weaver said. “When it comes to inflation, it’s a national issue and we need to fix what we can here in Pennsylvania. We need to invest in our communities, we need to invest in our businesses, and we need to invest in education, and that is what we are doing in this budget.

Greiner pushed for specific actions the Commonwealth could take to mitigate inflation on things like rising grocery prices, but officials had little to offer.

“We recognize this is a real concern,” said the department’s chief financial officer, Kevin Rowland. “Typically, inflation would be dealt with at the national level with fiscal and monetary policy, and that is what is happening now.

“In terms of what we can do at the state level, our agency, we’re happy to sit down with you and discuss how we can address this issue.”

Other lawmakers focused on an auditor general’s report that detailed “questionable decisions” about business closures during the pandemic.

Rep. Greg Rothman, R-Cumberland, asked if the report’s recommendations have been implemented, such as creating a task force to study how the department can improve.

Rothman also asked Weaver to apologize to the companies for the department’s handling of the closures.

Weaver said the department accepted the auditor general’s report but failed to implement the recommendations and ignored the request for an apology.

“We hope this doesn’t happen again,” Weaver said. “It was a pandemic and nobody knew what was going on. The medical community didn’t know what was going on and it wasn’t a perfect process.

“We did what we had to do to keep people safe,” he said.

Rep. Ryan Warner, R-Fayette, pointed to meta-analysis research that showed lockdowns had major economic consequences with little public health benefit and wondered how officials would do things differently.

“I think we would see it differently,” Weaver said. “I think it was a learning process. It wasn’t a perfect process.

Michael A. Bynum