Why Is There a Restaurant Industry Labor Shortage?

COVID-19 aggravated the industry’s major underlying problem. Employees do not feel valued for their job or driven to stay long-term since wages are too low.

Despite the fact that the business is currently improving, many restaurant staff has gone for good. Low earnings, limited benefits, the little possibility for advancement, and industry insecurity have all contributed to the business’s high turnover rates for years. With everyone wanting to employ, the industry talent pool is narrower and more competitive than ever before.

For a long time, the industry has struggled to hire (and keep) workers, particularly chefs, line cooks, and other back-of-house staples, even before COVID.

Cooks’ demand is expected to expand by 6% over the next ten years, faster than the average for all occupations, according to the Bureau of Labor Statistics. The fact is, the recruiting crisis that many desert eateries are experiencing right now isn’t only harming the kitchen. Restaurant personnel is in short supply in America, with a multitude of eateries and not nearly enough skill to go around.

So, if a member of your restaurant staff leaves because they don’t like one or more parts of their job, they have a lot of options when it comes to where they want to go next. And, with most eateries currently short on workers, they are eager to recruit them.

But not to worry, as Innowi has come to your rescue. In this article, weโ€™ll give you an overview of how this labor shortage is affecting your restaurant and a solution at the end. ๐Ÿ™‚

How the Labor Shortage Could Affect Your Restaurant?

1. Increased Waiting Hours For Guests

Your visitors’ dining experiences may suffer as a result of fewer front-of-house workers available to serve them and fewer back-of-house workers available to execute on- and off-premise orders. Whether it’s for a table, a meal, or a check, restaurant patrons despite having to wait longer than expected. When you’re low on employees, wait times are nearly certain to rise.

With fewer front-of-house employees, there are more sectors to work on. With increased duties, your employees will be compelled to spend less time interacting with customers over what’s on their plate or in their glass and more time obtaining orders, entering them in the point of sale, processing orders, and receiving payment.

You can lose that warm connection that ensures a return visit.

Fewer chefs on the line mean lengthier wait times for orders to be serviced at the back of the house. This will impair front-of-house table turn times, limiting your ability to accommodate the same number of checks every night as previously, eventually losing you money.

As a result, numerous restaurants around the nation have had to shorten their operation hours owing to a shortage of workers, for example, removing a full day or every day’s lunch service โ€” which lowers operating expenses in the near term but also lowers income.

2. Profit Margins Will Hit The Ground

You’ll complete fewer checks in a night if you have fewer employees and work at a slower pace. With less money coming in, your restaurant’s operating budget is diminishing, which will have a significant impact on your purchasing selections.

The typical profit margin at a restaurant is around 5%. Restaurant earnings are projected to suffer a larger blow in the coming years as labor expenses rise in tandem with pay increases.

Though labor scarcity may initially result in lower labor expenses, overtime restrictions will kick in as you lose staff and need to pay fewer individuals to work longer hours.

Make sure you’re staying compliant and safeguarding your company. Furthermore, if you provide a subpar visitor experience due to a staffing shortage, your sales will suffer as well.

3. Restaurant Staff May Decide To Depart For A Better Opportunity

It’s sadly common for folks who rely on the service sector as their major or single source of income to work long days and late nights just to scrape by. A restaurant employee’s typical yearly income, without tips, ranges from $11,000 to $27,000, with waiters at the bottom and chefs at the top.

Restaurant employees today are eager to seek out positions that provide competitive pay, relevant employee benefits, work perks, and a safe, friendly workplace. Workers may not believe that working at your restaurant would provide them with a paycheck that covers their costs if you pay front-of-house workers a normal minimum wage plus tips and back-of-house staff just above minimum wage. And, as a result of the COVID problem, many long-time restaurant employees have decided to leave the sector completely.

Restaurants are becoming more competitive by giving employee perks and innovative remuneration methods to fight the present labor shortage. It’s simple for employees to depart and discover a better choice if your restaurant fails to satisfy their expectations.

The State Of Restaurant Labor Shortage In Santa Clara

As the state hurries to restore more and more of its economy that has been shut down over the last year, labor analysts warn that California may face a potential labor shortage.

โ€œWe went from 64 employees down to 17 or 18 in three days,โ€ recalls Dan Holder, owner of San Jose’s Jack Holder’s Restaurant.

As the mild temperatures for outdoor dining spread across the country, full-service restaurants across the country are now witnessing: a persistent worker shortage in the face of an uptick in business, as well as the reduced Covid restrictions that started in South Florida and are now being felt across the country.

According to the Bureau of Labor Statistics, the hospitality industry lost more than 2.8 million jobs in April compared to pre-pandemic levels, with an unemployment rate of 10.8% compared to the national average of 6.1 percent.

Donโ€™t let the stats scare you.

You need a solution, and we have a full article that highlights it. ๐Ÿ™‚

Stop Struggling With Restaurant Labor Shortage โ€“ Solve It Now