Restaurateurs Cope With Tight Labor Market (Restaurants USA, September 2002)

September 2002 issue

Restaurateurs Cope With Tight Labor Market

Restaurants USA magazine's final issue was published in September 2002 but these archived articles remain available for our readers' convenience.

Restaurants USA, September 2002

The labor market has been the most pressing operational challenge for the restaurant industry for several years. Although the current economic downturn pushed the unemployment rate up from the historic lows of recent years, the industry continues to experience a labor shortage.
By Robert Ebbin

September 18, 2002

The tight labor market eased somewhat in 2001 because of the economic downturn and gains in the restaurant industry’s prime labor pool of 16-to-24-year-olds. Yet recruiting and retaining employees is the biggest challenge quickservice restaurant operators faced in 2001 and expect to face in 2002, according to the National Restaurant Association’s Quickservice Restaurant Trends—2002. Recruiting and retaining employees was the third-biggest challenge identified by respondents to the Association’s 2001 Tableservice Operator Survey, trailing the economy and maintaining business volume, respectively.

Turnover Stabilizes

More than half of the quickservice survey participants reported that hourly employee turnover at their company remained stable in 2001 compared to the same time in 2000, and more than one-quarter said turnover declined. A larger percentage of respondents (37 percent) said salaried-employee turnover dropped during the same time period. Among tableservice operators, roughly one-quarter reported a decline in turnover of hourly employees and one-fifth reported a decrease in salaried-employee turnover.

While turnover has lessened somewhat, operators continue to have difficulty finding employees to fill certain positions. Quickservice operators generally found it more difficult to find management and supervisory employees than crew workers. Half of the quickservice survey respondents reported that it is a problem for them to find crew workers, while roughly three out of five indicated that it is a problem to find managers and assistant managers.

Cooks are the hardest employees for tableservice restaurants to find. Roughly half of the tableservice operators surveyed reported that it is a problem to find these workers. One-third of tableservice operators said it is a problem to fill kitchen-worker positions, while a slightly smaller percentage of respondents said finding managers is a problem.

Operators Take Action

Restaurant operators have taken steps in recent years to attract and retain employees. More than half of the respondents to the 2001 quickservice operator survey and one-third of the respondents to the 2001 tableservice operator survey reported that they expanded recruitment efforts for new employees in 2001. Close to two-thirds of tableservice operators responded to the tight labor market by raising starting wages for new employees, while three out of 10 expanded their benefits package. In addition, nearly half of the tableservice survey respondents reported that they expanded their employee-training program.

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Robert Ebbin is director of research projects for the National Restaurant Association.