SANDUSKY, Ohio – Business in Sandusky should be booming this summer as tourists flock to return after a year of pandemic isolation.

There is one problem, however: many employers cannot find workers to occupy their restaurants and retail stores, forcing them to cut hours and turn away customers or think about big wage increases they cannot afford.

The problem was compounded last month when Cedar Point – desperate for employees – announced it would raise its starting salary to $ 20 an hour, twice what it was a year ago.

The move apparently worked. The theme park giant, which cut operating days this month to address staff shortages, recently reported that the attitude was strong enough June to resume full operations.

However, the company’s wage decision has sparked shock waves across the business community.

“They do what they have to do,” said Kula Lynch, who owns a small resale store, grocery store and several other businesses in town. “The problem is, most other small businesses can’t keep up. We should be making money now and nobody can do that because they can’t fill their business. “

It’s not just Sandusky.

The tourism industry across Ohio and beyond is facing the consequences of a quick restart after more than a year of near-total shutdowns.

“The summer months are critical,” said Melinda Huntley, executive director of the Ohio Travel Association. “If they are unable to work fully, it means more businesses are being lost and more jobs are being lost.”

The problem is complicated without a simple, short-term solution, she said.

And it leads to several longer-term questions about the tourism industry, both in this small lakeside town and beyond: Will prices go up? How can smaller businesses compete? Are these wages sustainable? And what happens when Sandusky’s international workforce returns?

The tourism industry was hit harder than any other industry during the COVID pandemic, with up to half of all employees being unemployed at some point. Now that the tourism industry is open again – and demand is roaring again – workers are unavailable for a variety of reasons, from childcare issues to unemployment benefits to new and better opportunities.

Michael Goldberg, executive director of the Veale Institute for Entrepreneurship at Case Western Reserve University, said the rapid recovery seems to have surprised companies.

“It’s amazing the speed at which this happens,” says Goldberg, who is also an associate professor at the Weatherhead School of Management. “The need for labor has kicked people on their feet.”

In fact, during a conference call on Q1 results in early May, Cedar Fair CEO Richard Zimmerman was asked if the company was technically prepared for the coming season. He said it was them.

Two weeks later, Cedar Point announced that it would close the park, water park and resort hotels for numerous days of the week in June and reduce daily operating hours due to labor shortages. It also announced an increase in the hourly wage to $ 20.

“I was shocked that they were so aggressive,” said Cleveland State University economics professor Bill Kosteas. “Obviously they feel like they need it.”

The wage increase seems to have had the desired effect.

Cedar Point spokesman Tony Clark said this week that applications have returned to pre-pandemic levels. “The process of hiring and training staff is ongoing and we continue to strive to provide our guests with the quality experience that Cedar Point has come to expect,” he said.

Ultimately, the increase in labor costs will be reflected in pricing, although it may not be immediately, said Kosteas, who is also the assistant dean of Cleveland State’s College of Graduate Studies. “I don’t see any other way,” he said.

In fact, Chipotle made nationwide news this week when it said it would raise menu prices by up to 4% so it could pay its employees more, averaging $ 15 an hour.

But small businesses, including many independent retailers in Sandusky, cannot cope with cost increases like large corporations, Kosteas said.

“For many companies, work is the single biggest cost factor,” he said. “I’m sure it is no exaggeration to say that you are very concerned.”

Businesses in downtown Sandusky are feeling the effects of a nationwide labor shortage compounded by Cedar Point’s decision to increase starting salaries to $ 20 an hour.Rich Exner,

Lynch said the average product at her Once Upon a Child resale store is $ 3. “I can’t pay $ 20 an hour – I just can’t. That would basically undermine the business, ”she said. “For the high school kid, the college kid – will they work for me for $ 10 or $ 11, or go to Cedar Point for $ 20? The choice is obvious. “

Their companies typically hire half a dozen workers for the busy summer months. “I’ve been hiring since January and it was someone I knew,” she said. “I can’t tell you how many thousands we spent on advertising without applicants.”

She noted that her favorite restaurant in town, Manny’s Tavern & Grill, had recently decided to close three days a week due to staffing issues.

Sandusky store owner Ryan Whaley, who owns the new paddle bar and several other stores in town, also said he couldn’t afford to pay $ 20 an hour.

“That’s capitalism,” he said. “Do I love it? No. You can do it. We have all signed up for this. “

He said he was lucky to have several employees who have remained loyal to him over the years.

“I’ve always paid a little more than typical bartender salaries,” he said. And the business has been so robust lately that its servers are making well over $ 20 an hour most nights, including tips.

He partially manages to keep some of his stores closed some days of the week – but that decision was made before Cedar Point’s wage announcement. “COVID taught me that when I take a break, I’m more effective,” he said. “We don’t have to work 80 hours a week every week.”

The staffing problem is more acute in places like Sandusky, which are relatively far from major metropolitan areas and heavily dependent on seasonal settings. Both Cedar Point and Kalahari Resort, an indoor water park in Sandusky, typically hire thousands of seasonal workers from overseas as part of the State Department’s J-1 visa program. This program was suspended for much of last year and has only recently been restarted.

Sandusky usually hosts several thousand international workers each summer; this year there are an estimated several hundred in the city.

Lynch expects Cedar Point to cut wages next year when international workers return in greater numbers. “These wages are not sustainable,” she said. “I worry that there is a false sense of security.”

Goldberg with CWRU is not so sure.

“If you want that $ 20-an-hour worker back next summer, you’d better not cut his wages,” he said.

Kosteas agreed that it was difficult to lower wages. “What you can do is not raise wages and in time they will be eroded by inflation,” he said.

Eric Wobser, the city manager in Sandusky, said the rapid rise in wages in the community has a positive side – more money in people’s pockets.

“Historically, wages in the tourism industry have been low,” he said. “I want this money to go to the employees rather than the shareholders.”

He also hopes the higher wages will encourage more employers to convert seasonal workers to year-round workers, which would bring more stability to both individuals and the regional economy.

Whaley also said he was not against raising wages in the community. “There is no question that wages will rise. I do not think that’s bad. But it has to be done sustainably and responsibly. “

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