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Inside the Restaurant Industry Labor Shortage

Guest sentiment on eating out is turning a corner. While patrons are returning to restaurants in almost pre-pandemic levels, staff are not. Consequently, restaurant owners across the United States are struggling to find the employees to meet the new customer demand — a problem that the Bureau of Labor says will hold back economic recovery.

Why Is There a Labor Shortage?

The restaurant industry has struggled with finding and retaining staff long before the pandemic. America has long had a surplus of restaurants and not enough laborers to fill positions. In the coming years, the Bureau of Labor predicts the demand for restaurant staff will grow as the amount of restaurant and food service workers fails to keep up — even as teen participation reaches pre-2008 levels and baby boomers return to the workforce.

Underpinning this talent shortage is the restaurant industry’s infamous reputation for poor workplace quality. The low wages, high stress, nonexistent benefits, and lack of long-term growth opportunities do not help to attract or keep employees. In fact, many employees that were laid off early in the pandemic have opted to leave the industry for good in search of a better opportunity.

Some also say that pandemic era unemployment benefits are discouraging workers from returning to work, fueling some lawmakers’ push to end pandemic-increased benefits. Research, however, suggests that childcare and health are bigger factors in the decision to return to work.

How Restaurants Can Overcome the Labor Shortage

Perhaps most obvious, restaurants need to step up their hiring game. Managers need to get creative in order to spread the word about open roles. Consider creating a referral program that incentivizes employees to recruit their food service friends. Cast a wide net and post on community billboards, online job sites, and social media. The larger the pool of candidates, the more likely one will turn into an employee.

With everyone looking to hire, securing talent is more competitive than ever. Employees have options and will choose the best place to work. Restaurant owners and operators need to invest the time and resources to position themselves as great places to work. Restaurant owner Amanda Cohen of NYC says, “we have to change the industry. We have to pay more, we have to make this a viable profession.” After eliminating tipping in exchange for a 20% surcharge on all checks and raising prices, Cohen has been able to pay her employees more and offer them benefits. She says that her restaurant Dirt Candy has had no problem finding workers amid this spring’s reopening.

Ultimately, the key to surviving the labor shortage is making your team feel valued and taken care of. Foundational to any good restaurant is a good team. Your people are worth the investment.

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