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National Restaurant Association - Employee tenure remains above pre-recession levels

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Employee tenure remains above pre-recession levels

Although median tenure of restaurant employees trended lower in recent years, it still remains above pre-recession levels, according to the NRA’s Chief Economist Bruce Grindy.  His Economist’s Notebook commentary and analysis appears regularly on Restaurant.org and Restaurant TrendMapper.

The tenure that restaurant employees have been with their current employer remains above pre-recession levels, according to data from the Bureau of Labor Statistics.  In January 2016, median tenure (the point at which half of all workers had more tenure and half had less tenure) for employees in the eating-and-drinking-place sector was 1.8 years, down slightly from 2.0 years in January 2014.

In comparison, median tenure of all private sector employees was 3.7 years in January 2016, down from 4.1 years in January 2014.

During the 2004 to 2008 period, median tenure was generally in the 1.5 year range for eating-and-drinking-place employees.  The higher post-recession tenure levels could be due in part to the declining representation of teenagers in the restaurant workforce in recent years, as they typically stay with employers for a shorter period of time.

There are several reasons why tenure among restaurant employees is lower than that of the overall private sector.  First, the restaurant industry is the economy’s largest employer of teenagers, as one-third of all working teenagers in the U.S. are employed in a restaurant.  Many of these 1.5 million teenage restaurant workers are getting their first job experience, and will go on to start a career with a different employer, either inside or outside the restaurant industry.

Second, the restaurant industry employs a high proportion of students, who often don’t work on a full-year schedule with the same employer.  Twenty-seven percent of eating and drinking place employees are enrolled in school, versus just 11 percent of the total U.S. employed labor force, according to the U.S. Census Bureau’s 2014 American Community Survey (ACS). 

The restaurant industry also boosts seasonal staffing levels at various points throughout the year, which leads to normal breaks in employment.  For example, the restaurant industry is one of the economy’s largest creators of seasonal jobs during the summer months, adding more than 500,000 jobs during an average summer season.  Overall, 31 percent of the eating and drinking place workforce are part-year employees, compared to 19 percent of the total U.S. workforce, according to the ACS.  

Full-year employees also contribute to a shorter tenure in the restaurant industry, as upward mobility often happens when employees move from one restaurant to another.  More than any other industry in the economy, the existence of multiple restaurants in nearly every community gives employees additional opportunities for upward mobility and career growth.  

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