In his latest commentary, the National Restaurant Association's Chief Economist Bruce Grindy breaks down the latest employment trends. Restaurants added a net 27,000 jobs in the third quarter of 2013, which was less than one-fourth of the strong second quarter gain. Despite the slowdown, restaurants are expected to post job growth above three percent for the second consecutive year.
The delayed September jobs report offered little clarity on the direction of the economy, as overall job growth remained relatively tepid. According to preliminary data from the Bureau of Labor Statistics (BLS), the private sector added a net 126,000 jobs in September, which followed gains of 100,000 and 161,000 jobs in July and August, respectively.
Taken together, the third quarter’s net gain of 387,000 jobs was the softest performance since the private sector added 350,000 jobs in the second quarter of 2012.
Job growth in the restaurant industry also slowed in the third quarter, based on the preliminary BLS reporting. Eating and drinking places – the primary component of the restaurant industry which accounts for roughly three-fourths of the total restaurant and foodservice workforce – added a net 27,000 jobs in the third quarter.
The modest third quarter gain was only a fraction of the 112,000 restaurant jobs added in the second quarter, and represented the smallest gain since the first quarter of 2010, when the industry was just starting to add back jobs after the recession.
Despite the third quarter speed bump, restaurant-industry job growth remains on a positive trajectory overall – a trend that is projected to continue in the months ahead. By the end of the year, the National Restaurant Association expects restaurant-industry job growth to come in at 3.2 percent for 2013, or double the 1.6 percent employment gain in the overall economy.
This would represent the 14th consecutive year in which restaurant-industry job growth outpaced the overall economy, and the third consecutive year in which the industry registered job growth in excess of 2.5 percent. In comparison, the overall economy hasn’t posted job growth above 2.5 percent since 1998.
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Annual Job Growth: Total U.S. Employment vs. Restaurants
Sources: Bureau of Labor Statistics, National Restaurant Association *Projected