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Restaurants are experiencing labor shortage: Will this be the final nail in the coffin for their business? (By Nadya Capozzi )

 


After over a year of the pandemic, businesses are finally starting to reopen to the public. Businesses, especially in the hospitality industry, are booming a lot more than before the pandemic.

Because most businesses have already laid off most of their workers because of the pandemic, they do not have enough manpower to meet the sudden spark of demand. In other words, businesses can’t keep up with staffing needs in order to fill the increasing demand.

Unemployment messes with restaurant operations

Due to the pandemic, restaurants across the U.S. had to shut down, driving up unemployment. The ongoing pandemic left plenty of people across the world “jobless.” Only certain stores were considered “essential” and remained open. With government aids to the unemployed, some people are making more money than earning the minimum wage even when they are not working.

Then, why would people want to go back to work?

Undocumented workers do not receive any financial aids or unemployment benefits. Meanwhile, some workers may ask for higher pay and better benefits due to the increasing demand for the workforce. Labor shortage messes with restaurant operations. Higher labor costs mean higher menu prices, which could result in less revenue for the restaurant.

Restaurants must market their business to potential employees to attract workers

With good unemployment benefits, people are not going to work unless they know that they are satisfied with their weekly/bi-weekly paycheck. Plus, they might have to expose themselves to customers, which could create a health concern during the pandemic. 

Soleil Ho, a writer for SF Chronicle, states that restaurant workers should and can expect more: like living wages, reliable scheduling, paid time off, managerial support in customer conflicts, benefits and equitable treatment by management. Taco Bell, for example, is starting to hold spot interviews in their parking lots and will add benefits, paid time off, and more for their general managers.

Fast food restaurants, as a whole, are changing their hourly pay and adding benefits to catch the eye of literally anyone to work for them. As the desperation grows stronger, the interview process is moving a lot faster compared to the pre-pandemic period. As of now, finding workers is a top challenge for the majority of re-opening restaurants.

American Hotel & Lodging Foundation finds ways to attract workers with a marketing effort

The foundation strives to help people build their careers and improve their lives, while still improving the lodging industry. According to The New York Times, the AHLA Foundation has been expanding the programs they offer to attract more workers. The foundation is planning to hire and train thousands of management and supervisor apprentices, help them earn a FREE college degree and award many with scholarships.

Labor shortages affect restaurant operations and service quality

The labor shortage issue facing the hotel and restaurant industry affects not only the day-to-day operations but also their customers. Service will suffer when having an insufficient number of service staff. Customer satisfaction will decrease due to a longer wait time.

According to The New York Times, restaurants are selling more expensive food, but their service is lackingWater glasses are left unfilled, for instance. Guests stand waiting for attention at a host stand. Servers with little knowledge of the menu merely smile sheepishly as sophisticated customers ask questions.

Restaurants are starting to hire anyone to meet the increasing demand of businesses and address the labor shortage issue. In my opinion, one of the main questions a restauranteur should be asking themself is:

How am I going to make more revenue if my staff does not know what they are selling?

Employers should emphasize the importance of customer service during job interviews. All staff must be aware that great customer service is one of the main components in the hospitality industry.

All in all, restaurants are experiencing labor shortages affecting their service quality and operations. Finding workers for the labor demand is tough for restaurants during the post-pandemic era.

Open-Ended Thoughts

Facing labor shortage constraints, shall restaurants stay open for dine-in service that requires a lot more service staff than takeouts? Or shall they offer limited services for now and re-open after they are fully staffed? Also, should all restaurants increase hourly pay and add more benefits to their staff? Why or why not?

About the Author

Nadya Capozzi is a first-year Hospitality Management student at the Collins College of Hospitality Management at Cal Poly Pomona. She has experience in the hospitality industry, helping her family run an ice cream business that is located in the Mission District in San Francisco. Being exposed to the industry her whole life gives her a good knowledge of hospitality, customer service, innovative thinking, marketing, production, and sales. In the future, she plans to utilize what she learns from the Collins College of Hospitality Management in the areas of marketing management and food and beverage to possibly. She aims to open her own hospitality business.  

Note: The pictures were downloaded from bloomberg.com and hotelexecutive.com.

References

Ho, S. (2021, April 19). When restaurants can't find workers, some soul-searching is in order. Retrieved April 23, 2021, from https://www.sfchronicle.com/food/restaurants/article/When-restaurants-can-t-find-workers-some-16106686.php

Jimbo, M. (2020, September 24). The restaurant crisis is hitting undocumented workers particularly hard. Retrieved April 24, 2021, from https://thecounter.org/undocumented-restaurant-workers-covid-19-coronavirus/

Russ, H. (2021, April 06). Fast food struggles to hire as DEMAND soars, U.S. ECONOMY ROARS. Retrieved April 23, 2021, from https://www.reuters.com/business/fast-food-struggles-hire-demand-soars-us-economy-roars-2021-04-06/

Steinhauer, J. (2018, April 05). A worker shortage is forcing restaurants to get creative. Retrieved April 23, 2021, from https://www.nytimes.com/2018/04/05/dining/labor-shortage-restaurants-employment.html

Who we are. (n.d.). Retrieved April 23, 2021, from https://www.ahlafoundation.org/who-we-are

 

Comments

  1. Maintaining your restaurant's sales amidst fierce competition and rapidly changing trends can be a challenge. A key to success is finding the balance between acquiring new customers vs. retaining existing customers. With any new goal, you can best approach this by creating a plan and breaking it down into actionable steps. TruforteBusinessGroup

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