Since 2020, numerous restaurants have faced mounting labor difficulties—including finding new employees and keeping current ones on board.
One-third of operators say that labor shortage is the top ranking economic challenge of 2022, according to Datassential’s 2022 One Table report. And, the National Restaurant Association’s 2022 State of the Restaurant Industry report states that 7 out of 10 operators across all major restaurant segments say they don't have enough employees to meet consumer demand. Most anticipate labor issues in the industry will last through 2023.
Maintaining service can be challenging when a restaurant is working with a smaller-than-expected staff. Operators, however, can make a number of proactive moves to offset current and future labor issues—including implementing some of the following approaches.
Using Pre-Prepared Products
One in three operators has experienced a decline in their kitchen staff’s culinary skill level in the last year alone. As a result, some are turning to ready-made dishes and ingredients that are versatile enough to be incorporated into multiple meals—such as Clemens Food Group’s Hatfield® Premium Reserve Pork® all-natural bone-in and boneless chops—to help reduce prep time and manpower needs.
Components that make dishes less complicated to assemble may not be possible for some eateries, according to Ray Camillo, founder and CEO of Blue Orbit Hospitality Consulting, which advises restaurateurs and hotel and restaurant groups.
“Pre-prepared food like sauces in bags, pre-cut onions [cost] more,” Camillo says. “Smaller mom-and-pop restaurants that don't have the ability to spread their fixed costs across an estate of 20 restaurants are at a disadvantage.”
A number of the operators that can, however, intend to—17% say they plan to transition toward using more pre-made products, rather than relying on scratch preparation methods.
Optimizing the Menu
During the pandemic, restaurants pared down what they offered due to supply chain issues, staff shortages and other factors. Six in 10 full-service operators say their menu now is smaller than before.
A number are taking the way their menu is physically designed into account. One restaurant group, according to Ray Camillo, founder and CEO of Blue Orbit Hospitality Consulting, is using a robust QR code system—an element he says is increasingly being included on menus—to facilitate service.
“It’s actually making the dining experience better, in many ways,” he says. “You can order your drink right when you sit down; you don’t have to wait for anybody. It’s not a typical server with a four-table section—it’s one or two ambassadors for the whole dining room. They just bounce around and check on everybody; so [as an operator], you’re keeping your costs down.”
Making Operational Changes
In addition to utilizing traditional incentives like pay increases to try to bolster staffing levels, some operators have tested out more unexpected labor solutions—such as a robotic device that’s reportedly been used to fry food at Chipotle and other restaurants. Eateries have also employed technological solutions that provide virtual labor for the drive-thru and other processes.
Operators, in some instances, altered their hours to be able to provide service with fewer employees. Currently, though, Camillo says, instead of closing between lunch and dinner, restaurants are more often adjusting their staffing practices to better align with their sales cycle.
“If you drew a graph of sales throughout the day, you’re going to see two humps: One at, say, noon to 1, and then another hump at 6 to 7,” he says. “The first course of action is daypart scheduling—which is just instead of bringing all your cooks in at 10 a.m. and then sending all your cooks home at 4 p.m., you stagger them in and out.”
Considering a More Flexible Overall Structure
The COVID-19 pandemic may have exacerbated restaurants’ labor issues; operators, though, had experienced staffing challenges before its onset. The National Restaurant Association’s 2020 State of the Industry report—published in February 2020, just before the pandemic fully impacted the U.S.—noted that recruitment and retention was an ongoing concern for operators, who were, at the time, facing a growing amount of job openings.
“We’re still stuck in a very big hiring crunch,” Camillo says. “There are plenty of jobs out there; a lot of people just don’t want to work in the service industry the way that they used to.”
Younger generation members, he says, view time as their greatest asset; and a number would prefer to perform gig work whenever they’d like, instead of committing to restaurant employers’ traditional scheduling method—which requires employees to be available for a certain number of hours or shifts a week and find out when they’ll be working a week or so in advance.
Camillo suggests operators may benefit from adopting a surge pricing-type scheduling model, where they’d essentially crowdsource labor by allowing workers to accept available shifts via a tech platform, potentially offering more money for time slots that are perceived as less desirable.
“The solution is to maintain a pool of part-time employees you don’t schedule,” he says. “Based on capabilities and a ranking system, [certain people] are eligible to work a Saturday night; and all anybody—[including] someone who left six months ago—has to do is sign up. There’s a huge pool of people who want to work when it’s convenient for them; now they’re competing for the plum shifts, instead of you trying to schedule it.”
The industry’s labor market woes aren’t likely to disappear anytime soon; although eating and drinking establishments added more than 74,000 jobs in July, the sector still employs roughly 650,000 fewer workers than before the pandemic.
However, whether operators are struggling to hire or hold onto employees, several strategies can help them avoid having any major business continuity lapses as a result.
By applying techniques that range from speeding up meal prep with pre-made items to giving customers more control in the ordering process and completely reinventing the way locations are staffed, restaurants can position themselves to have enough talent resources on hand to fulfill orders—while also being able to provide consistently high-quality service.
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