The latest restaurant crisis: a shortage of staff | Baker Tilly
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The latest restaurant crisis: a shortage of staff
Sept. 29, 2021 · Authored by David Foster, Foster and Associates Restaurant and Hospitality Consultants
As if COVID-19 wasn't bad enough, a now-recovering economy has presented the restaurant industry with another far-reaching challenge — a scarcity of workers. As the economy opens up and restrictions on restaurants fade away, many operators are finding that they cannot fully reopen because they lack an adequate number of staff to meet an ever-growing consumer demand. Before the pandemic, 11.1 million people worked at restaurants. Even with unemployment rates dropping, the restaurant industry is still about 1.1 million employees short, or about 10% down from pre-pandemic numbers.
Some restaurants are handling this better than others. The difference? Restaurants that have a positive work culture and an effective recruiting strategy are coming out on top. Those that a lacking these two ingredients have been forced to curtail operating hours and/or even close down on some days of the week, resulting in lost revenue.
What are some of the strategies that are working?
Create a positive culture in your restaurant.
Communicate with your staff.
Offer flexible schedules and electronic scheduling.
Craft job postings that can actually attract applicants.
Make it quick and easy to apply.
Create career path development programs.
Train, train and then train some more.
Offer higher wages.
Add benefits.
Consider employee referral bonuses and new hire bonuses.
Create a positive restaurant culture
Every interaction between management and staff is a moment of truth — and these interactions reflect your employees' perception of whether or not your restaurant is a good place to work or not. Your staff has to believe that management and ownership actually care about the well being of your team members. A positive culture drives staff performance — and great staff performance drives guest satisfaction.
How do you create and nurture a positive restaurant culture? Here are a few important steps:
Get to know your staff members as people, not just cogs in a wheel. Address them by name, learn about their family and interests.
Set high standards and enforce them. We all terminate the really bad employees, but it is the mediocre ones that do the most damage to staff morale.
Be fair and be consistent. No one likes to feel that they are not being treated fairly.
Make sure your expectations are clear and consistent and then enforce those appropriately.
Listen more and talk less. When a staff member needs your attention, give them your undivided attention.
Always say please and say thank you when interacting with your team — and set the expectation for them to do the same with each other.
Praise in public, but counsel in private.
If you are wrong, own it. Apologize.
There is a deep connection between a positive restaurant culture and employee satisfaction. When someone does not like the company they work for, they will eventually leave. Each of your team members needs to know he or she can be heard and that their opinions and ideas matter. They want to work for a company that has a positive impact on their community. A culture of fear serves to create resentment and distrust; a positive one fosters happiness, job satisfaction and innovative ideas.
When your team members feel valued and appreciated, they are much more likely to value and appreciate each other and your guests. Want happy guests? Make certain to have happy employees.
Communicate with your staff
Simplify your on boarding and keep it interesting! New employees pay the most attention early on.
Recognize that people are different. Understanding how to recognize the differences in how individuals learn and what motivates them is key to engaging with them.
No warm bodies! Keeping mediocre employees ruins the morale of your good employees.
Communication isn't just about conveying rules and regulations to your staff. It also involves owners and managers listening to their team members' concerns and ideas. Make certain your lines of communication are open in both directions.
Offer flexible schedules and electronic scheduling
A big issue — especially with Millennials and Generation Z — is to have flexibility in their schedules. Many are balancing personal commitments, childcare and second jobs. This means that as a restaurant employer, you may need to hire more people focusing on part time staff that can fill the gaps.
These same younger groups grew up with digital technology and expect their employers to use modern communication tools - including scheduling. Flexibility and ease of communication are two of the newest hallmarks of a successful restaurant business.
Craft job postings that can actually attract applicants
The days of simply posting a "Now Hiring" sign on your doors or windows are past. Virtually every one of your competitors is also trying to hire staff. You must be more creative in your recruiting efforts if you are to succeed. First, determine who comprises the pool of applicants. Keep in mind, teenagers and college students are returning to the workforce. This group can compose a key portion of your staff, especially during the summer and school breaks.
Once you have determined whom you want to reach, create an ad — and platform — that is likely to garner their attention. Remember the old adage — people want to know "what's in it for me?" (WIIFM) They tune in to WIIFM pitches much better than if your pitch is all about you and what your restaurant needs. If you offer flexible hours, tell them. Have higher than average pay? Share this. Is your restaurant involved in the community? Do you offer vacations? Is there a hiring bonus? Benefits? Include testimonials from your staff as to why they love working for you. All of these are ways to tell your story and let potential applicants know they should apply.
Be creative in where you post your job openings. Use your social media pages to communicate your opportunities. This includes using TikTok to create a fun video to capture the attention of potential applicants. Get your staff involved and be creative!
Make it quick and easy to apply
Shorten your initial application as much as possible. You can always obtain more info during the interview process. Ideally, allow applicants to apply using their smartphones. Have an app? Make it application-friendly. Offer "open interviews" several times per week.
Chipotle™ has risen to a position of leadership when it comes to being able to adequately staff their restaurants. Part of their "pitch" is to outline a potential career path for their team members. While not all of us operate multiple restaurants, we can still come up with a career path that allows our staff to move up and eventually become managers, area supervisors or even directors of operations.
As a restaurant consultant I have recommended to many clients that they establish rankings" within their team, especially in your kitchen, which has yielded success. Even if you only have a single restaurant, try using a "competency chart" to list all jobs within your kitchen across the top with all Back of House (BOH) team members' names listed down the side. Then, designated each job position to have up to five potential points that can be earned:
"1" point is a rookie on that job.
"2" is being able to do the job, but still learning.
"3" means you are adequate.
"4" means you have mastered the position.
"5" means you are not only a master, but certified to train others in that position.
As a team member progresses in both the mastery of the job and total number of jobs learned, they can move up in points. Another options is to use either logo hats or shirts to differentiate employees. "Green shirts" are new hires for the kitchen, red shirts are for adequate employees and black shirts are for masters. Set point thresholds for employees to move from a "green shirt" to a "red shirt" to a "black shirt."
Present the team member the new shirt in front of his or her peers. Celebrate the accomplishment. Another benefit of this (especially in multi-unit restaurants) a manager from one store can come into a different unit, look at the colors of the hats (or shirts) in the kitchen and immediately know who the rookies are and who the masters are.
Open communication with each employee is key to success. Sit down with each team member to find out who is potentially interested in turning his or her job into a career in the restaurant industry. Then help them to craft a development path. Be a mentor.
Train, train and then train some more
There is a direct correlation between the quality of training and the successful retention of your staff. Poor or insufficient training leads to mistakes — and those mistakes lead to frustration and a sense of failure for both the new hire and employees. Many restaurant managers (especially when short-staffed) hurry new team members through server training, rationalizing excuses like "Oh, you have been a server before so we can skip this part." For most clients we recommend at least six training shifts, a dedicated trainer and multiple tests along the way for both the Front of House (FOH) and the BOH.
As COVID-19 and new technology continues to impact the restaurant industry, training becomes equally as important for your long-term employees as well. This training becomes a mixture of having the trainer or management show the trainee what to do, then tell the trainee what they are doing, then have the trainee show them and finally having the trainee be able to explain what, why and how they performed the task.
Offer higher wages
Previously, I wrote an article about the impact of a $15 wage on the restaurant industry. In many parts of the country, this wage has become a reality whether legislated or not. Supply and demand in your market will dictate the wage you will need to pay in order to hire talented people for your restaurant. Paying the same as others in your market simply gets you parity and is the bare minimum you should be prepared to do.
Many restaurants are having to curtail the number of days they are open, costing themselves thousands of dollars in lost sales, all while saying they cannot afford to pay staff members a higher hourly wage. Think about it. If raising your hourly rate helps you to attract more staff, and in turn that increase in staff allows you to be open more days, doesn't it make sense to do that? Just keep in mind that higher wages are the cost of entry — not the sole solution to your staffing shortage.
Add benefits
In the '70's, I managed a group of very high volume restaurants. As a young manager, I was frustrated because we were losing great employees to hospital food service. So I asked them why they were jumping ship. The response? Hospitals offered health insurance. Like most restaurants in that era, we did not. I went to the owners and told them we have to start offering health insurance. Naturally, they reacted by crying out "but how can we pay for that?"
I used a few case history examples of the cost of our high turnover. They finally (albeit reluctantly), agreed. We became one of the first independent restaurant groups in our state to offer health insurance, with part of the premiums paid by the company and part by the employee. We immediately saw our turnover drop, resulting in cost savings in the long run. Some additional benefits you could consider adding include:
Paying all of our staff (even part-time) vacation pay. We prorated their average weekly hours and paid vacation pay based upon that average.
Offering membership in a credit union.
Discounted health club memberships.
Collaborating with other businesses to leverage discounts and put together a competitive set of benefits that we could offer our staff. The result was high employee retention, low recruiting and training costs and a much more positive culture. Take a hard look at your own operation to determine the benefits that you can offer. These can help set your business apart from the rest of the pack.
Consider employee referral bonuses and new hire bonuses
Just as higher wages are part of the cost of entry, referral bonuses are important. Your existing staff is the absolute best source of new talent. Establish a referral bonus that is fair for both your restaurant and the employee.
New hire bonuses, while they may attract more applicants, are less important than an ongoing fair wage. Experiment with them if you would like. Just keep in mind that it may cause resentment on the part of your existing crew members that were hired without receiving a bonus.
There is no simple, single magic-bullet solution to the restaurant industry labor shortage. But, there are proven steps you can take as an operator to become the restaurant employer of choice in your market.
