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Surviving the Restaurant Industry Labor Shortage

November 18, 2021  |  Foodservice Industry

Restaurant labor staff shortages

Industries all across the board are suffering from labor shortages, but the restaurant industry is taking the brunt of the blow. While a lot of this is due to the coronavirus pandemic, this shortage has been a long time in the making — employee turnaround has always been a store spot for restaurant managers and owners. What's causing the labor shortage, and what can restaurants do to attract and keep good employees?

What caused a labor shortage?

Owning a restaurant has always been a risky prospect. Profit margins are often thin, which ends up reflected in employee wages. In America, tipping culture means that there are waitstaff and other tipped employees to make far less than minimum wage on an hourly basis. Their tips are supposed to cover the gap and then some, but slow times mean that tipped employees may only make minimum wage. Considering that the minimum wage hasn't kept up with inflation or employee productivity for decades, low wages are a major contributing factor for people choosing not to enter the restaurant industry. It already has a reputation for being a high-stress atmosphere where employees work long hours on their feet all day, and low wages don't help.

A gap in employee skills and employer demand has also driven the shortage. Many restaurant owners and managers need employees with certain skill sets, and these employees aren't available. Having a shortage of workers also means that there aren't enough employees able to train new workers, creating a self-perpetuating problem.

When COVID hit, a lot of restaurants, bars, and cafes were forced to close. Employees were either placed on hiatus or let go entirely. Fortunately, the industry has made somewhat of a recovery as vaccines became more widely available and social distancing mandates were lifted.

If the food service industry is recovering, why is the labor shortage still going on?

After already living with low wages, many simply chose not to return to their old jobs. Low wages and a lack of benefits like health insurance meant that it simply wasn't worth it.

This isn't the only driving factor, however. While restrictions on restaurant operations are largely lifted, many employees don't feel that enough is being done to keep them safe. Restrictions on working visas and international travel also mean that there aren't enough new workers coming in to take their place.

How can restaurant owners survive the labor shortage?

If you're a restaurant owner, it may seem like a lot of the factors driving the shortage are beyond your control. Fortunately, there are a number of things you can do in order to make sure your business doesn't suffer:

Don't let opportunities pass you by.

A labor shortage means that workers are in high demand. That means that it doesn't behoove you to hold onto applications for too long. If someone wants to work at your restaurant, bring them in for an interview as soon as you can. Your establishment probably isn't the only one they're applying to, so, if you wait too long, your competitors are going to snatch them up.

Focus on keeping the employees you have.

Your current workers know the ins and outs of your operation. They know your menu, your venue, and how you do things on a daily basis. Keeping them happy means lower employee turnaround, less time spent in training brand new employees, and a better experience for guests. Ask your employees what you could be doing to make things better. Take their suggestions. Things like free food, employee discounts, and flexible schedules can boost morale with minimal expense.

Offer incentives.

One way to attract new workers is with sign-on bonuses and benefits. The only problem is ensuring that your current employees don't miss out — if they feel that new employees are being prioritized over them, they may just leave for one of your competitors. Offer current employees headhunting bonuses and other incentives to help draw in new talent, and reward the workers you already have.

See what you can automate.

Not all restaurant operations can be automated, nor should they be. Some things, like restroom maintenance, can benefit from sensor technology to help make them more efficient. Wherever you can increase efficiency, you reduce the workload on your employees. Reduce their workloads, and they can focus on more important tasks.

Examine your business model

Employment is changing all over, and employers have to work harder to figure out how to court the workers they need. In some cases, this might mean altering your business model. See how other successful ventures are doing it. Some have turned to open-book management, which educates staff on the particulars of running the business and offers transparency into their personal roles in its success. Others have started profit sharing.

There are a lot of things driving the labor shortage in the restaurant industry. Even if owners and managers can't change them, they can work around them by placing more value on the employees they already have. Treat your workers well, and they'll want to keep working for you. They'll also help you court new talent, and turn the perception of hospitality as a stressful, demanding, low-paying industry into one where employees are valued and taken care of.

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