Why the employment crisis in American restaurants could make going out to eat more difficult

As some restaurants are considering closing due to a shortage of staff, it can become difficult to get the social experience of going out to eat.

Despite fears that the economy will slow due to rising inflation and interest rates, the war for talent continues to rage in the United States. There are more than 11 million job openings in a range of industries. This means that competition among people interested in working is still close to an all-time high.

This places the burden on employers to find ways to make themselves attractive to job seekers.

One industry that particularly struggles to stay employed is the restaurant business. Hard hit by pandemic lockdowns, restaurants are trying to bypass previous delivery orders and go back to eating at home again. You know, it provides that “normal” feeling of going out to eat food that we’ve all been missing out on over the past few years. To do this, they must hire employees. According to recent data from Restaurant365, in the last year alone restaurants increased their employment by 1141% compared to previous years.

But there’s a catch: Restaurants are struggling to retain many of those new employees they hire — which means they’re still looking for an uphill battle to stay open.

“Restaurants are not evolving to meet the needs of current and future employees,” says Tony Smith, CEO of Restaurant365. Retention begins with changing the narrative around restaurant jobs. Employees want a career, not a job. Restaurant owners should provide this opportunity.”

The good news, Smith says, is that there are actions restaurants can take to flip script and develop in ways that they can become employers of choice.

spinning pain

One of the biggest challenges in retaining restaurant employees is that many people think of these jobs as job listings rather than careers.

“A common misconception is that all restaurant jobs are low paying, no benefits, treated as a commodity, no future, and the workplace is bad,” Smith says. “For this reason, restaurant turnover is always higher than most industries, often hovering around 70% annually.”

Today, as every employer struggles through the “Great Resignation” period, restaurants are taking a hit more than ever, with employee turnover soaring to 140%.

“This makes it difficult for restaurants to provide great customer service and high food quality when they are constantly training new people,” Smith says.

Jobs on Jobs

Smith says the first step to take in addressing employee turnover is to start telling a new story to current and potential employees. The narrative should turn out to show people that working there can indeed provide an upward path for those employees interested in building a career in the food industry.

“Nine out of ten restaurant managers have started in entry-level positions, so it’s safe to say that the next restaurant manager might come from his in-house team,” Smith says.

To help paint a better picture of how employees can grow their career within the restaurant, they should chart a career path and identify the critical skills the associate will need to move into new jobs.

Smith recommends some basic steps to create this mindset shift so that employees can pursue a career rather than just a job:

  1. Participate in a clear career path from the start of preparation or even during interviews.
  2. Help them see examples of real people in your restaurant who have progressed down this path.
  3. Provide them with mentorship opportunities by you or your best people.
  4. Be purposeful in developing and communicating your desired culture frequently.
  5. You have a vision of where your restaurant is headed, share it with your employees and make sure they understand their role in it.
  6. Offering other valuable benefits in addition to the hourly wage.

Smith points to a case study of a client, The Buona Companies, who owns and operates two of Chicago’s most popular food brands with 26 (and growing) units in the greater Chicagoland area. Over the past five years, he says, they have developed an amazing “Hire to Retire” program that has helped reshape what it means to work in their restaurants. Not only do they give them pay raises, but they also offer tuition assistance, family discounts on meals, and more vacation—all benefits that employees may not always expect from a restaurant.

In addition to offering enhanced benefits, Smith says, restaurants also need to give their employees greater opportunities to develop their skills as a whole.

Learning on the job

“People don’t want to be in a slump,” Smith says. “They are drawn to growth. Helping them develop themselves in ways unrelated to their specific job can go a long way.”

He says restaurants can direct their focus to three key elements to help drive that feeling in employees:

  • Autonomy: Can they make decisions on their own?
  • Mastery: Have they become experts at things they can be proud of?
  • Purpose: What is the greatest benefit in the work they do?

“People also need to feel the intrinsic value of satisfaction and enjoyment in their work, not just in their pay,” Smith says.

Developing an effective mentorship program is a great way to give employees – especially younger ones – advice and guidance in building their careers. Another is training them to develop specific skills or investing in tools that make employees’ jobs easier, such as inventory and scheduling software that can alleviate the frustrating tasks of their daily work.

“Some of the resistance to buying certain tools is the feeling that if you did, people wouldn’t actually use them,” Smith says. “But the people who value your investment in and benefit from these tools are the same people with a growing mindset that you really want to keep around your restaurant for the long term.”

robotic future

The big change happening in the restaurant industry, in part because of its struggle to retain employees, is the growing openness to using automation to help run businesses.

“At this year’s National Restaurant Association Show in Chicago, robots were a hot topic, and many were on full display,” Smith says. “From mixing drinks to flipping burgers to making pizzas to wheeling trays around tables, they can do a number of tasks now.”

It also points to other changes that have already been rolled out over the past few years, such as how it is now possible to place orders via a mobile app or website, using a QR code at a table or kiosk in the entrance, or even through Alexa.

“The pandemic has accelerated technology adoption for several years,” Smith says. “And while the rate of adoption for services like online delivery and ordering won’t progress as fast as we just saw, it won’t be back to where we were before the pandemic hit again. Years later, delivery on the road will continue to grow, and one day, It could potentially be a driverless self-driving car.”

Still, Smith says he’s not looking forward to a future filled with a lot of automation. “I still long for the opportunity to go out and have a social experience,” he says. “This is part of the beauty of the service that restaurants provide for all of us. Food is clearly a big part of the equation, but being human together is another part.”

Lesson learned: Restaurants still have time to change and make themselves more attractive to job seekers before it’s too late and robots take over entirely. And nobody wants that.

Leave a Reply

Your email address will not be published.