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Posts Tagged “Hospitality”

Employment Crisis in Restaurants

I have procrastinated on writing this summary.  Our second questionnaire sought data on the current state of staffing and recruiting for restaurants. (For those who missed the first summary, there are 25 respondents to these questionnaires, representing thousands of restaurant units in all segments.) I wanted to write something profound and perceptive about the labor crisis that restaurants are experiencing. I wanted to write something that hasn’t been written already. But I have no new answers, no new insights.

By now, most everyone is aware of the scarcity of candidates for open restaurant positions. The reasons are numerous, including concern about COVID infection, lack of childcare options keeping people home, ease of obtaining unemployment benefits and relocation to areas of the country where cost of living is lower or where job opportunities are more lucrative. But the most significant reason appears to be that many have abandoned the restaurant industry as no longer a reliable and consistent way to make a living. Even the most conscientious of restaurateurs had to furlough or layoff team members at some point during the pandemic, some by choice, more because of municipal mandates on how restaurants could operate. Of those restaurant workers who were able to remain employed throughout the pandemic, most tipped employees saw a decline in earnings from lower sales resulting in lower tips and a decrease in hours worked, which impacted non-tipped employees as well.

Here’s the data on how our group is seeing the situation;

Finally, as restaurateurs grapple with the need to adjust to the shortage of eligible workers, here’s a sampling of some of the comments from our respondents;

My two cents? Between the effect of COVID on the industry and the social forces that have been at play for some time, I believe that the basic operating practices of the restaurant industry will undergo dramatic change over the next five years.

In order to bring people back into the industry, restaurants and all food service employment, will have to increase wages and benefits. Service charges will become standard practice in full service restaurants, while the very highest-end restaurants will continue to build service into the price of their menus. More casual restaurants will adopt technology (e.g. self-ordering on your phone) to reduce labor. In the not too distant future, tipping in the US will resemble the European practice of a small token of appreciation for a job well-done but the standardized 20% gratuity will already be included as a service charge.

Thought or comments you want to share? Please do!

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