Maine’s hospitality industry is facing another summer labor shortage, made worse by new uncertainty in a foreign worker program used extensively in the state.
Last year, some resorts and hotels had to cut back hours, shut blocks of rooms and close earlier than they preferred because not enough H-2B visas were available to make up for a paucity of local workers.
The situation is likely to reoccur this year, prompting Maine’s U.S. senators to urge the Trump administration Monday to raise the limit on foreign workers. In the meantime, hospitality operators are redoubling their efforts to find local help.
“I am not sure, especially with the statewide unemployment level, that we have enough people,” said Allyson Cavaretta, general manager at the Meadowmere Resort in Ogunquit. Most of the 20 worker visas that the business applied for this year were approved, but it is still looking for about nine people, Cavaretta said.
Businesses like the Meadowmere are doubtful they can find those workers locally. Maine’s unemployment rate fell to 2.9 percent in February, the lowest point in 40 years, and the labor shortage is even worse in coastal towns such as Ogunquit with a small year-round population but a huge influx of summer tourists.
“We are scrambling to see if there are people in-country,” Cavaretta said. “We have run ads as far south as Puerto Rico. I think so far we have gotten one person this year.”
VISA PROGRAM IS TIGHTLY REGULATED
The issue threatens to hobble Maine’s tourism industry, which was worth $6 billion last year. Maine’s seasonal employers, from large resort hotels to seafood takeout spots, have used the H-2B program for years to fill positions that aren’t taken by U.S. workers.
But the process is a complex journey through three different federal agencies, each with its own rules. The program allocates 66,000 visas nationally, split evenly in two halves of the year for temporary workers to work in hospitality, landscaping, forestry and food processing. The program is tightly regulated. Employers are required to offer jobs to Americans before hiring foreigners, and to pay at least a prevailing wage mandated by the Department of Labor.
Once applications for H-2B workers are certified by the department, they must be reviewed and approved to apply for visas by U.S. Citizenship and Immigration Services, a division of the Department of Homeland Security.
Last year, employers panicked when the visa process hit the cap and stopped in March. An intense lobbying effort on Capitol Hill resulted in 15,000 more visas, but not until mid-July, too late to help many summer businesses in Maine.
This year, the writing was on the wall much earlier – within a day of opening the process on Jan. 1, the Department of Labor received applications to certify 81,000 foreign workers, an unprecedented total and more than twice the number of available visas. To deal with the deluge, Citizenship and Immigration Services held a lottery at the end of February to dole out 33,000 visas, leaving tens of thousands of requests unfilled and anxious employers clamoring for relief.
LENGTHY H-2B APPLICATION PROCESS
David Hanson, human resources director for the Gorges Grant Hotel, Juniper Hill Inn and Milestone in Ogunquit, is waiting to hear about the status of 20 of his H-2B applications. The company typically brings in 35 foreign employees, about a third of its peak season workforce, Hanson said.
The H-2B process is expensive, time-consuming and unpredictable, but Hanson said he can’t find workers locally even though the resort has raised wages and offers a $100 referral bonus for employees if new hires stay at least 60 days. It recruits for housekeepers year-round.
“Quite honestly, I don’t see it producing a lot more applicants because they just aren’t out there,” Hanson said of the hotel’s local recruiting efforts.
He and Cavaretta have the additional challenge of operating in southern Maine, where almost half the state’s accommodation and food service workers are employed and where the labor pool is tightest and competition fierce – the unemployment rate in York and Cumberland counties has hovered around 3 percent for two years.
It is not clear how many Maine employers received approval for H-2B visas from the lottery, but 128 Maine businesses applied to the Department of Labor to certify 2,481 workers this year, according the Maine Department of Labor, the majority for work in the summer hospitality industry. The workers take jobs unfilled by Americans, but also support U.S. employees. Many hospitality businesses reported burnout and exhaustion among their U.S. staffers last year because they were forced to work long hours and multiple positions to cover service gaps.
Despite the problems, Maine hotels and restaurants combined for a record $3.8 billion in combined sales in 2016.
Greg Dugal, director of legislative affairs for the Maine Restaurant and Maine Innkeepers associations, said businesses that applied early on Jan. 1 had a chance at the lottery, but those who waited until just a few days later were out of luck. A provision in the $1.3 trillion federal spending bill passed last month allows Secretary of Homeland Security Kirstjen Nielsen to increase the number of available visas, but it is uncertain when that decision will be made and how many more visas will be available despite pressure from Congress.
Republican Susan Collins and independent Angus King of Maine were among 33 U.S. senators who signed an April 2 letter to the Department of Homeland Security and the Department of Labor urging them to reopen the H-2B application process immediately.
“Under the authority provided by Congress, the Department of Homeland Security can immediately help businesses hire the workers they need and help local economies as they head into the peak season,” the senators wrote.
LONGSTANDING PROBLEMS IN PROGRAM
The arbitrary lottery is just the newest problem in the troubled visa program, said Marcus Jaynes, a partner at Landis, Arn and Jaynes, an immigration law firm in Portland.
“Especially in the last five to 10 years, it has been a very popular program and the government knows what is going on and what to expect,” Jaynes said. “It is not being administered in a predictable or efficient way.”
None of Jaynes’ 10 Maine clients has been able to petition for visas this year because of the lottery, Jaynes said. They might have been able to turn to H-2B workers already in the country who could have accepted work on an extended visa, but those workers already have been snapped up.
“It is a real nightmare for everybody,” he said. “It results in employers hiring undocumented workers, (or) hiring H-2B workers who are here but not supposed to work for more than one employer.”
Critics have accused the program of giving employers an avenue to undercut U.S. workers by paying them less and subjecting foreigners to harsh working conditions, but those accusations aren’t factual, Jaynes said. “The rhetoric about protecting U.S. workers and U.S. jobs is coming up against the reality of employers not being able to get workers, and that’s having a negative impact on the overall economy,” he said.
Seven Maine employers have violated the H-2B program since 2009, according to records from the Maine Department of Labor’s wage and hours division. Bread and Roses Bakery, in Ogunquit, was ordered to pay almost $95,000 in January to resolve violations of the program for paying foreign workers more than the wages advertised to possible U.S. workers.
‘THERE JUST AREN’T ENOUGH LOCAL PEOPLE’
Jorge Acero, director of labor outreach and education at the Maine Department of Labor, agreed that seasonal hiring is a major issue facing seasonal employers.
“There just aren’t enough local people to hire for those jobs,” he said.
The crunch has some tourism operators looking elsewhere.
In Kennebunkport, major resorts are reaching out to retirees to fill cashier, reception and concierge jobs this summer, starting with an April 10 job fair aimed at older residents, said Laura Snyder Smith, marketing and events manager at the Kennebunk, Kennebunkport and Arundel Chamber of Commerce.
Last year, some of the town’s signature resort properties had to close earlier then they wanted because of a worker shortage, she said.
“This is a new push. It is a direct result of the lack of visa workers last year,” she said.
Employers are willing to work around schedules and offer flexible times in order to bring on enough workers, she said, a priority for older recruits.
In Boothbay Harbor, Ramsey Lafayette, regional manager for Lafayette hotels, was excited that he was able to recruit a trio of workers to come and staff three properties while he was on a ski vacation in Colorado. Lafayette gave up on the H-2B program a couple of years ago because it was too volatile and unpredictable. Instead, he has tried to get more foreign students with J1 work-travel visas and redoubled efforts to hire locally.
“I always joked that I had a help-wanted sign out all last year; at some point I was always looking for someone,” Lafayette said. “I can’t think of a situation when I haven’t hired someone almost on the spot.”
The labor shortage means long hours and hard work for the staff he does have, and ultimately a loss of business. This year he is considering not serving breakfast and limiting other menu options to manage an understaffed kitchen, and the hotel may have to close earlier in the fall, missing out on strong tourist traffic that goes into October.
“We could do more business, service more customers, but we can’t do that because of the labor situation,” he said.