Restaurants are stretched thin as they deal with an unprecedented labor shortage since the pandemic in 2020. The U.S. Bureau of Labor Statistics reported that lodging and food services had a 9.1% quit rate in April.
But why are restaurant workers in short supply and what can the industry do about it?
Many restaurant workers were laid off during the pandemic and have failed to come back to the industry as food service began to open up again. Many of them sought work in other industries not knowing when they’d be able to return to work at restaurants.
Black Box Intelligence surveyed former and current hourly employees and found it’s not the unemployment benefits that keep them from restaurant work. In fact, more than two-thirds of current and former restaurant workers said disrespect from customers is a major factor in the industry’s labor shortage. More disturbingly, almost half of those workers cited emotional abuse from their managers as a factor in the decision to leave the industry. Fifteen percent said they were sexually harassed by managers or co-workers, and another 15% said they were sexually harassed by customers.
With few benefits of working at a restaurant and little room to grow, compensation was also a key factor, and “right now employees have the upper hand,” said Victor Fernandez, Black Box’s vice president of insights and knowledge.
Out of the thousands of workers surveyed, they also cited factors like scheduling, childcare, and overall concern about their mental and physical health as issues for not returning to the field.
Workplace culture was less a factor, Fernandez said, but that may change as the industry reaches a new equilibrium and wages stabilize. “We see now that states with the highest minimum wage have the lowest turnover rates,” he said.
In the second quarter of 2021, limited-service hourly worker pay increased 10% year over year. That’s up significantly from the 4.1% increase in the first quarter.
Line cooks in full service saw a 6% increase in Q2 of 2021, 3% higher than the increase seen in Q1 this year.
The Bureau of Labor Statistics reported that job openings have increased to a series high of 10.1 million in July 2021, with accommodations and food service accounting for a large portion of the increase.
That has resulted in a “job candidate’s market,” the report said.
The already high turnover rates within the industry have spiked even more and voluntary quits are at an all-time high. For limited-service restaurants, turnover rates increased to a whopping 144% in June 2021, compared with 135% in 2019. Similarly, full-service restaurant turnover was 106% in June this year, compared with 102% in 2019.
Still, 66% of respondents said they would return to the industry if the right conditions were met, the report found.
This shortage is definitely affecting how restaurants do business. According to a National Restaurant Association poll, 72% of owners said that finding and keeping employees was their biggest issue. So what can restaurants do to keep their business afloat with less staff?
Be willing to advertise locally, including in community centers and local schools, as well as online and through restaurant staffing agencies. Utilize social media and hire a person who understands how to highlight the restaurant’s advantages so it stands out from the competition. To encourage current employees to recruit new hires and reward them for doing so, think about providing an employee referral bonus.
It’s a wonderful start if your business is able to offer competitive wages. If not, take into account providing possibilities for professional growth, compensated workplace activities to promote morale, and overtime opportunities. It’s a big step forward if you have the ability to hire part-time workers full-time and provide a benefits package.
Ask for help from your community. Establish connections with local groups, high schools, college fairs, and after-school programs to provide people with free training or skill-building workshops in exchange for a temporary job. The foundation for successful collaborations where the restaurant hires people and the employees get vital skills for the job market is being a pillar of the community.
Make sure that what your team is doing is absolutely vital to their job description given that they already work long hours for low wages. Adding more unimportant work might feed the cycle of feeling overworked and underappreciated. Invest in technology, such as online reservation services or automated inventory systems, to assist minimize more of the time-consuming administrative processes. Your team will be more productive and more likely to stay on staff if you relieve them of these tedious responsibilities.
Technology like Nuvioo can essentially eliminate waiters altogether. With self-serve kiosks, the customer can order and pay on their own and summon a food runner or hostess if they need refills. With the back of the house fully organized with a ticketing system that allows for less waitstaff mistakes, they have the ability to prepare orders correctly. You can ultimately get away with running your restaurant at 100% with only 60% of your staff. You can make more money and save time hiring and training.
Nuvioo also has reports that tell you when your busiest time is so you know when you need more staff on hand and what your most popular food items are so you could even decrease your menu size thus eliminating food waste.
People are eating out more than ever and restaurants are vital to the economy. Nuvioo is a game changer for the restaurant industry. No longer do you need multiple software to run your business. Nuvioo’s platform has the software built right in so you can manage everything in one place. Let’s change the way you do business!