Bowhead to lay off 61 employees at Letterkenny

Bowhead Logistics Management LLC will lay off 61 employees at its Letterkenny Army Depot facility starting late next month, it informed the state Department of Labor & Industry.

In its Worker Adjustment and Retraining Notification Act filing, Bowhead said the layoffs at 1350 Superior Ave., Building 57, Chambersburg, are expected to be permanent.

The cutbacks are due to “unplanned conclusions of maintenance programs and projected reductions in maintenance work” on certain contracts, the WARN notice said.

Jobs will be phased out between Sept. 29 and Nov. 16.

Affected employees at Letterkenny are represented by a union, District Lodge No. 1 of the International Association of Machinists and Aerospace Workers, AFL-CIO.

“We apologize that we were unable to provide to you more advance notice of this action,” the WARN letter said. According to the WARN Act, advance notice is supposed to be sent at least 60 days ahead of any layoffs.

“The Army only recently notified Bowhead of its requirements that Bowhead must implement these employee separations and the dates on which the required separations must occur,” the Bowhead WARN letter continued. “Accordingly, after reviewing the Army’s request and identifying those employees who will be impacted by the Army’s directive, including meetings between Bowhead and the union to work together on the layoff plan in accordance with the collective bargaining agreement, we are providing this notice to you at the earliest possible time.”

Attempts to reach the Machinists Union and Bowhead for comment were unsuccessful.

Bowhead also laid off 60 employees at Letterkenny early this year.

UIC Government Services LLC and its Bowhead family of companies, including Bowhead Logistics Management LLC, are part of Ukpeagvik Iñupiat Corp., an Alaska Native corporation.

Paula Wolf is a freelance writer

220 workers lose jobs as contract ends for FedEx Supply Chain

FedEx Supply Chain is discontinuing the management and operation of a facility at 115 Willow Springs Lane in East Manchester Township, affecting the jobs of all 220 people the third-party logistics provider employs there.

The employees received written notice Aug. 1, according to a Worker Adjustment Retraining Notification Act filing the company made with the state Department of Labor & Industry.

“FedEx Supply Chain currently operates the facility on Willow Springs (Lane) in York for a customer that will be transitioning its business to a new third-party logistics provider,” the company said in a statement.

“In October, this new provider will assume operation of the … facility. Affected team members were notified in advance of any changes taking place, and we are actively providing assistance with finding other employment opportunities within the company, including at other FedEx facilities in the area. Additionally, we anticipate that there may be opportunities for FedEx team members once this new provider is in place.”

The WARN letter FedEx sent to the state said that affected employees, none of whom is unionized, will be paid wages and benefits through their last day of employment with FedEx Supply Chain Inc. They also will be provided any retirement and group insurance benefits to which they are entitled.

As a service of FedEx Logistics, FedEx Supply Chain provides industry expertise in technology, health care, retail, consumer and industrial markets, its website said, offering warehousing and distribution solutions, e-commerce fulfillment, forward and reverse logistics capabilities and value-added services.

Paula Wolf is a freelance writer

PA Chamber examines Shapiro’s strategy to rebuild workforce

Gov. Josh Shapiro has been touring Pennsylvania speaking of his proposals to restore the state’s flagging workforce. An effort that may not be looking enough at the big picture, according to the PA Chamber of Business and Industry. 

Jon Anzur, vice president of public affairs for the PA Chamber, noted that Pennsylvania businesses of every size and industry are dealing with a workforce shortage that predates the pandemic but was intensified by COVID-19. 

“Even before COVID, businesses were struggling with the worker shortage, but the pandemic really exacerbated this challenge,” said Anzur. “So many workers left Pennsylvania to go to another state to find opportunities or just left the workforce entirely. Employers as a result are struggling to find qualified workers. 

“You’re seeing Pennsylvania largely starting to recover the jobs that were lost during the pandemic. The challenge, though, is that Pennsylvania lagged the rest of the nation by six months to fully recover those jobs and our workforce today is smaller than it was pre-pandemic.” 

In the two-plus weeks following Shapiro’s first budget address, the governor has crisscrossed the state discussing his budget’s “commonsense” proposals to rebuild Pennsylvania’s workforce.  

Shapiro’s tour has taken him to Lancaster City to speak to local firefighters, to the Pennsylvania Police Academy in Hershey, the George Washington Carver High School of Engineering and Science in Philadelphia, Lackawanna College Police Academy in Scranton, Gwynedd Mercy University, Colfax K-8 Elementary School in Pittsburgh, and Mercyhurst Municipal Police Academy in Erie. 

A common thread to all the above is Shapiro’s desire to hear firsthand the challenges facing nurses, police, and teachers, three professions that have been hit particularly hard by a decreased workforce. 

Anzur said that while the PA Chamber appreciates the governor focusing on the workforce issue, he thinks the chamber would encourage lawmakers to focus on policies that would improve workforce development across all sectors. 

“From our perspective, job training and investing in proven job training and career and technical job training programs would help individuals develop the skills they need for the jobs that are available,” Anzur stated. “We talk to employers in manufacturing, in technology and innovation, in health care and they have jobs that are available. They just can’t find the workers who have the skills necessary for those careers.” 

“Investing in different educational programs and job training, and re-training of workers for these available jobs would go a long way,” he added. 

Lack of affordable health care is another challenge the chamber sees as exacerbating the worker shortage. 

“This is really a multi-pronged issue,” said Anzur. “We see younger families struggling to afford childcare and it’s leading to one of the adults in the family to leave the workforce to stay home with the kids. This is something we really think the private sector is responsible for driving solutions.” 

To that point, Anzur said the chamber is seeing Pennsylvania’s employers taking up the task of addressing the crucial childcare issue in various ways. Employers are assessing their employee’s needs to determine what working parents need from their employers, what their flexibility is in the business, and if they can provide hybrid work schedules and work from home. 

“Implementing these sorts of strategies and tracking the impact is something we’re seeing from our members and businesses across Pennsylvania, and I think it’s starting to have a positive impact,” said Anzur. “Figuring out that childcare piece will go a long way to getting adults back into the workforce.” 

Viewing the workforce shortage from a macro-economic perspective, Anzur said that as Pennsylvania’s tax and regulatory environment improves, so will investment into the state. That means more economic growth, which would have a positive impact on wages and bring Pennsylvanians back into the workforce and keep them in state. 

“With the pandemic, we saw tens of thousands of Pennsylvanians leaving the state to go other places for opportunities,” said Anzur. “As businesses are able to save on costs as the result of tax and regulatory reform, they will be able to invest more of that money back into the workforce. That’s going to lift wages and lead to more Pennsylvanians seeking employment here.” 

An additional key factor in rebuilding the state’s workforce focuses on continuing the phase down of the corporate net income tax from its current 8.99% to 8.49% later this year and eventually down to 4.99% by 2031. 

Permitting reform is another issue Shapiro has been speaking to, and Anzur noted that Republicans in the Pennsylvania Senate have introduced legislation to streamline and speed up the permitting process. 

“That’s a process that costs businesses millions of dollars annually here in Pennsylvania,” said Anzur. “As businesses save on those costs and are able to reinvest that money back into their workforce, I think you’ll see a positive impact of people coming back into the labor force here in Pennsylvania.” 

Workforce shortages rank among the biggest challenges facing Pennsylvania residents, and Shapiro has proposed incentivizing the nursing, police, and teaching professions with a three-year tax credit of up to $2,500 per year for new recruits. 

Anzur said the PA Chamber agrees with the governor’s prioritizing the labor shortage, and at the same time is taking a big picture view of the crisis. 

“From our perspective,” said Anzur, “while we share the governor’s concern and focus on strengthening Pennsylvania’s workforce, we’re looking at a more macro approach to addressing this issue that will impact positively Pennsylvania’s workforce across all sectors – job training, childcare, and improving our tax and reg environment.”

Report: Lancaster County workforce not bouncing back to pre-pandemic levels

The Lancaster County economy is healthy overall, though there are signs of weakness as rising interest rates may dampen business activity, according to the latest report from the Center for Regional Analysis.

Established by the Economic Development Company of Lancaster County in 2018, the center provides insight into local market conditions and consumer sentiment.

Rae Ann Miller, the center’s data analyst, said a few trends stood out in the report, which was released early this month.

One involves the size of the labor force, which seems to be settling into numbers that are below pre-pandemic levels, she said.

COVID-19 severely disrupted Lancaster County’s labor market, and the “new equilibrium” appears to be normalizing at a lower level when compared with 2019, the report noted.

That year, Lancaster County had 288,400 people in the labor force. In 2021, the number averaged 284,900.

Rather than returning to 2019 (pre-pandemic) numbers, this year’s labor market is comparable to 2021. Through the first eight months of 2022, Lancaster County’s labor force is again averaging 284,900 people, around 1.2% lower than in 2019.

The report concluded that COVID-19 “likely accelerated demographic forces already in play,” with economists having previously pointed to the aging population as a factor in the shrinking size of the labor force. The decline in labor supply only accelerated with the pandemic as “waves” of people left the labor force simultaneously.

Though it affects all sectors, the tightness in the labor market is most severe in leisure and hospitality. In September, there were 3,300 fewer workers in that sector in Lancaster County than in 2019, even with businesses reporting strong demand.

“Expect labor markets to remain tight given the labor supply, especially as businesses try to hire for the coming holiday season,” the report said.

The county’s unemployment rate was 3.3% in September.

Across all industries in Lancaster County, the average yearly pay is $53,803. The top two employment industries – health care/social services and manufacturing – have average pay above that, along with construction and professional business services.

On average, professional business services pays the most at $68,322 a year, while trade, transportation, utilities, and leisure and hospitality pay the least, with leisure and hospitality coming in at 60% under the county average.

“Notably, this data is influenced by part-time workers, thus sectors with a significant number of part-time workers will have their average pulled down,” the report explained. “Sectors that pay lower average wages and historically have more part-time workers are having more difficulty returning to pre-pandemic levels of employment.”

Miller also noted what emerged in interviews with local business owners, which was that managing costs and the shadow of economic uncertainty may overtake labor issues as their biggest challenges.

Escalating interest rates are a concern for business pipelines, the report said, with construction one of the key sectors experiencing a softening of demand. This is being interpreted “as a potential early warning for where the economy is headed in the coming year.”

Consumer sentiment up significantly

The report also included encouraging news, as consumer sentiment in Lancaster County is on the rise. The measurement of that metric climbed to 72.86 in September, an 11-point improvement from July.

“The recent gains signal that the local sentiment is beginning to move away from scores reflective of recessionary periods,” the report explained; the local reading is also much higher than national consumer sentiment, which is still at recessionary levels despite gaining over the summer months.

The local poll showed improved attitudes toward current conditions and the future. County households were more positive about the strength of the local economy and their household’s financial situation.

The number of households that reported being better off than a year ago doubled, from 7% in July to 14% in September. Still, 44% of households said they were worse off, as inflation remains a persistent problem.

Paula Wolf is a freelance writer

Employee or independent contractor? DOL publishes new rule seeking reclassification

The U.S. Department of Labor (DOL) issued a new proposal recently on whether workers under the 1938 Fair Labor Standards Act (FLSA) should be classified as employees or independent contractors. 

The Biden Administration proposal would rescind the current rule put into effect in January 2021 by the Trump Administration, which it argues did not comply with the FLSA and the decades of judicial precedent applying it. The DOL asserts that under the Trump Administration thousands of workers were misclassified as contractors instead of employees. 

“Frankly, we aren’t surprised to see the Biden Administration’s Department of Labor rescind the Trump-era independent contractor rule and replace it with a test that favors more workers being classified as employees rather than independent contractors,” Jill S. Welch, partner and chair of Lancaster-based Barley Snyder’s Employment Practice Group, wrote in an email response. 

Welch counsels companies in handling workplace challenges and helps clients resolve disputes, claims, cases, and litigation in aspects of labor and employment law.  

What many were waiting to see regarding the proposed DOL rule, she wrote, was if it would mirror the “ABC test” used in states such as California and New Jersey. She called it “a very employee-friendly test that makes it more difficult to support independent contractor status” and noted that President Biden during his campaign indicated support for the ABC test.

Welch said the proposed DOL rule does not adopt the ABC test.  What it does is set forth a six-factor economic realities test to determine whether a worker is an employee or an independent contractor under wage and hour laws.  “This is not new or ground-breaking here in Pennsylvania,” she wrote. “Pennsylvania courts have been using these economic realities test for decades, most recently in cases involving Uber drivers.” 

Welch outlined the six-factor economic realities test utilized by courts in Pennsylvania, which is similar to the proposed DOL rule: 

1) the degree of the alleged employer’s right to control the manner in which the work is to be performed; 

2) the alleged employee’s opportunity for profit or loss depending upon his managerial skill; 

3) the alleged employee’s investment in equipment or materials required for his task, or his employment of helpers; 

4) whether the service rendered required a special skill; 

5) the degree of permanence of the working relationship; and 

6) whether the service rendered is an integral part of the alleged employer’s business. 

“No single factor is determinative – courts look to the totality of the circumstances, as will the DOL,” wrote Welch.  “The ‘right to control factor’ is highly relevant, though, and we expect to see comments on whether the employer needs to exercise actual control, or merely have the right to control the work.  In the end, these factors should answer the seemingly straightforward question:  is the worker in business for him or herself or is the worker economically dependent on the potential employer for work.  

“The use of technology and the gig economy, which afford companies and workers a greater degree of independence and flexibility than the traditional manufacturing work model (prevalent when the FLSA was first enacted), have made the analysis more difficult.” 

The new regulations proposed by the Biden Administration are aimed at replacing the previous rule for classifying employees as contractors, workers not covered by federal minimum wage laws, and not entitled to benefits such as health care and paid sick days. 

“While independent contractors have an important role in our economy, we have seen in many cases that employers misclassify their employees as independent contractors, particularly among our nation’s most vulnerable workers,” Secretary of Labor Marty Walsh said in a prepared statement. 

The DOL proposal seeks consistency with decades of case law employers have used to properly classify workers as employees or independent contractors under the FLSA. It also looks to reinstate comprehensive analysis to determine a worker’s status under the FLSA, and that the analysis does not favor any single economic reality factor or factors. 

“The Trump-era rule would have elevated two factors over the others: (1) the nature and degree of control over the work; and (2) the worker’s opportunity for profit or loss,” Welch wrote. “A reason the current DOL proposes rescinding this prior rule is that it conflicts with the tests used by the majority of courts, creating confusion and unpredictability and expense for companies and workers as cases grappling with the new rule would slowly wind their way through courts.” 

The DOL’s Wage and Hour Division reviewed feedback solicited last summer from stakeholders prior to publishing its Notice of Proposed Rulemaking on Oct. 13. Stakeholders can continue to submit comments during a 45-day period which ends Nov. 28. 

Welch wrote that as a reminder, “other agencies such as the IRS, and other states such as California and New Jersey, have their own independent contractor tests and factors.  So, companies and workers need to distill all of these tests depending on where they are located to reach the answer to that seemingly simple question – is the worker in business for him or herself.” 

IEC Electrician Apprenticeship Program to hold open enrollment

Applications for Independent Electrical Contractors (IEC) Pennsylvania’s apprenticeship program will be accepted from October 19-28. IEC’s apprenticeship program begins in January 2023. 

Those accepted into the apprenticeship program will work full-time as electrical apprentices for electrical contractors and attend employer-paid instructional classes in-person and online. Residential, commercial, and industrial construction and wiring are covered in the four-year program. The program has a hiring rate upon completion of 100 percent and graduates are qualified as experienced electricians rather than entry level. The program is registered with the U.S. Department of Labor and the Pennsylvania Apprenticeship and Training Council. 

As of May 21, the median annual wage for electricians in Pennsylvania was $68,660, according to the Occupational Outlook Handbook published by the U.S. Bureau of Labor Statistics. Applicants must be 17 years of age or older and have a high school diploma or GED. 

High school students and individuals interested in the electrical field can also apply for IEC Pennsylvania’s state-registered pre-apprenticeship program. Hands-on experience in the field and opportunities to shadow electricians will also be available for pre-apprentices. 

IEC Pennsylvania also offers continuing education for electricians and electrical contractor owners in-person and online with subjects including business management, First Aid/CPR, ariel lift operation, variable frequency drive systems, arc flash analysis and code updates. The chapter represents merit-shop and independent electrical and systems contractors in 64 of Pennsylvania’s 67 counties. IEC Western Reserve serves the commonwealth’s Beaver, Lawrence, and Mercer counties. 

Some 70,000 electrical workers and more than 3,500 electrical contractors are represented by IEC, founded in 1957. 

US jobless claims at the highest level since November

A day after the federal government reported that the country added a higher-than-expected 528,000 jobs in July, the Labor Department announced Thursday that the number of Americans who signed up for unemployment benefits rose last week to the highest level since November.

Applications for jobless aid climbed by 14,000 to 262,000 and have risen five out of the last six weeks. Initial claims for unemployment benefits in Pennsylvania jumped from 6,785 to 7,101.

The four-week average for U.S. claims increased by 4,500 to 252,000, also the highest since November.

And the number of Americans collecting traditional unemployment benefits increased by 8,000 the week that ended July 30 to 1.43 million, the most since early April.

As the Associated Press noted, “unemployment applications are a proxy for layoffs and are often seen as an early indicator of where the job market is headed.”

However, hiring in the country remains strong, despite rising interest rates and weak economic growth.

The July unemployment rate of 3.5% tied a 50-year low reached just before the COVID-19 pandemic slammed the U.S. economy in early 2020.

The economy contracted in the first half of the year, which usually signifies the onset of a recession, the AP said. But the job market’s strength and resilience so far in 2022 runs counter to that, so the data is mixed.

Paula Wolf is a freelance writer

Economy adds 528,000 jobs in July, smashing expectations

The U.S. labor market performed well beyond expectations last month, adding 528,000 jobs and dropping the unemployment rate to 3.5%.

That’s the lowest unemployment has been since the COVID-19 pandemic hit in early 2020. The report from the Labor Department also showed that all the jobs lost in the coronavirus recession have been restored.

July’s jobs number, which defied recession fears and rampant inflation, is the most since February and is up from 398,000 in June.

The Labor Department also revised May and June hiring totals, adding an extra 28,000 jobs in those months. Employment was particularly strong last month in the health care industry and at hotels and restaurants.

“Recession – what recession?” Brian Coulton, chief economist at Fitch Ratings, wrote after the numbers came out. “The U.S. economy is creating new jobs at an annual rate of 6 million – that’s three times faster than what we normally see historically in a good year. ‘’

And Eric Merlis, managing director of global markets at Citizens, said in a statement: “This was a surprisingly strong jobs report that shows how robust the U.S. labor market is. The numbers support economic growth and should give the Fed more ammunition for aggressive actions to tame inflation.”

Paula Wolf is a freelance writer

Pennsylvania unemployment rate drops below 5% 

Pennsylvania’s unemployment rate dropped below 5% in March, something the state hasn’t seen since the rate peaked at 16.5% during the early days of the pandemic. 

The Pennsylvania Department of Labor & Industry (L&I) announced this week that the state’s unemployment dropped two-tenths of a percentage point last month to 4.9%. 

The rate marks a steady decrease from its heights in 2020 and brings the state under its pre-pandemic unemployment rate of 5% in February 2020. 

Pennsylvania’s civilian labor force increased by 17,000 in March. The employment count rose 32,000 while resident unemployment declined by 15,000. 

Jobs increased in eight of the 11 industry subsectors with professional and business services seeing the largest gain from February. 

Approximately 83% of jobs lost since the pandemic state have been recovered, according to L&I. 

“This month’s jobs report marks the 23rd consecutive month in Pennsylvania without an unemployment rate increase,” said L&I Secretary Jennifer Berrier. “The numbers show the commonwealth continues to rebound strongly from the devastating effects of the pandemic, which put an enormous strain on our labor force. The datasets we are releasing today highlight the resilience of the millions of Pennsylvania workers doing their part to keep our economic recovery headed in the right direction.” 

Across the country, the U.S. unemployment rate also dropped by two-tenths of a percentage point last month, declining to 4.6%. 

Workforce grant program to offer $1.5 million to building and construction apprenticeship programs 

Apprenticeship programs within the building and construction trades are eligible for part of $1.5 million in grant funding through Pennsylvania’s workforce diversity grant program. 

Pennsylvania Department of Labor and Industry Secretary Jennifer Berrier announced on Tuesday that the new round of grants will be available to state apprenticeship programs to develop diverse talent pipelines and reach underrepresented populations within building and construction. 

Applicants will design or build new or design upon existing apprenticeship and pre-apprenticeship programs to reach underrepresented populations, the department wrote in a release. 

“There’s no question that diversity within the workforce promotes equity among workers, innovation within business and strength in our economy overall. One extremely effective way of achieving workforce diversity, equity and inclusion is through apprenticeship programs that allow workers to earn while they learn,” Berrier said. 

The grants are offered through the department’s Apprenticeship and Training Office. The Wolf Administration established the office in 2016 to support and expand apprenticeship programs across the state. 

The grant is meant to help programs target women, minorities, individuals with disabilities, veterans, socio-economic disadvantaged individuals, individuals who speak English as a second language, individuals who were previously incarcerated or individuals experiencing multiple barriers to employment. 

Applications for grant funding are due by April 21. 

Changes to tipped worker rules awaits regulatory approval 

An update to Pennsylvania’s rules regarding how employers pay tipped workers will be voted on by the state Independent Regulatory Review Commission during a meeting next month. 

The Pennsylvania Department of Labor and Industry (L&I) announced this week that it submitted its final-form regulations to update Pennsylvania’s Minimum Wage Act. 

The changes would modernize guardrails to protect tipped workers and ensure consistency for employers, said L&I Secretary Jennifer Berrier. 

“The world of work has changed significantly since these regulations first went into effect in 1977, but tipped workers remain a sizeable and critical segment of Pennsylvania’s workforce,” said Berrier. “They are the only workers whose take-home pay ultimately depends on the generosity of their customers and not the obligation of their employer.” 

The final-form regulation covers five areas for tipped workers, including: 

  • An increase to the amount in tips an employee must receive monthly from $30 to $135 before an employer can reduce their hourly pay from $7.25 per hour to as low as $2.83 per hour. 
  • A tip credit given to employers under certain conditions, including that the employee spends at least 80% of their time on duties that directly generate tips. 
  • Tip pooling among employees that would exclude managers, supervisors and business owners in most cases. 
  • A prohibition on employers deducting credit card and other non-cash payment processing transaction fees from an employee’s tip left with a credit card or other non-cash method of payment. 
  • A requirement for employers to clarify that automatic service charges are not gratuities for tipped employees. 

If the IRRC approves the regulation during its March 21st meeting, it will then be submitted to the Office of Attorney General. Upon its approval by the office, it will be published in the Pennsylvania Bulletin. 

The regulation changes fall in line with Gov. Tom Wolf’s broader work protection agenda, which has seen the governor push legislation to increase Pennsylvania’s minimum wage, paid sick leave and more. 

Wolf announces $2.5 million in Clean Energy Workforce Development Grants 

The Wolf administration announced a $2.5 million grant program Friday to boost the state’s clean energy sector as it tries to rebound from COVID-19 job losses. 

Five Clean Energy Workforce Development Grants of up to $500,000 will promote overall industry recovery from the pandemic. The state Department of Labor & Industry invites local workforce development boards to submit project proposals that would support at least 25 local or regional clean-energy businesses. 

Proposals are due March 14; the projects will kick off in July and continue through June 2025. 

A report last year from the Pennsylvania Department of Environmental Protection found that the state, which is a manufacturing hub for wind, hydro turbine and Energy Star products, shed 13,200 clean energy jobs between March and December 2020 because of the economic fallout from COVID-19. 

As the industry bounces back, skilled workers within the clean-energy sector are increasingly in demand. Even prior to the pandemic, at the end of 2019, eight in 10 clean-energy employers in Pennsylvania reported difficulty in locating qualified applicants, a release noted. Lack of experience and industry-specific knowledge were the main reasons. 

More skilled fabricators, assemblers and other manufacturing workers are needed, as well as construction and installation workers such as heating, ventilating and air conditioning mechanics, electricians and solar photovoltaic installers. 

The clean energy industry includes the technology sectors of energy efficiency, clean energy generation, alternative transportation, clean grid and storage and clean fuels. Among the subsectors are solar, wind, efficient lighting, hydropower, smart grid, electric vehicles, and biomass fuels. 

“This investment in the clean-energy sector’s workforce is an investment in the future of Pennsylvania,” Labor & Industry Secretary Jennifer Berrier said in the release. “While its recovery from the COVID-19 pandemic is well under way, this is an industry that the Wolf administration wants to see thrive over the next decade. We need to be developing a talent pipeline now to make that vision a reality.”