December 27, 2021

Taking the Pulse of the Industry: Labor Issues and Shortages in Food & Beverage

By John Uhrynowski, Supervisor, Tax & Business Services

Taking the Pulse of the Industry: Labor Issues and Shortages in Food & Beverage Food & Beverage

Since the World Health Organization declared COVID-19 a pandemic in March 2020, the restaurant industry has endured more than its share of economic turmoil. The establishments that did survive the mandatory shutdowns, supply chain issues, and rising prices now face a new challenge: staffing shortages not seen in years.

While there are various reasons local restaurants cannot find help, here are the ones most often cited in recent interviews we conducted with a few restaurateurs:

  • The CARES Act expanded unemployment benefits, so workers collecting unemployment are earning more staying home than they were when they were working on site.
  • Wait staff and other employees with pre-existing medical conditions were afraid to work in crowded restaurants where the chance of exposure is high.
  • The pandemic gave workers the chance to stay home and work toward jobs that allow for a better work-life balance than working in a restaurant. They don’t want to sacrifice their personal lives working the sometimes long and late hours required in the restaurant industry.

When asked how they responded to these challenges, one owner said that during one mandated shutdown, he spoke to managers of his restaurant’s five locations – daily. While some employees did leave for the safety net of unemployment benefits, others did not. And by making use of outside dining facilities and expanded takeout, he was able to persevere.

Another operator we spoke to had to close for a month, and all non-family employees applied for unemployment benefits. With the help of family employees, he was eventually able to start back up for takeout only.

Going forward, the key to attracting and retaining employees appears to be in offering incentives. Some of the bigger restaurants and fast-food chains are offering on-the-spot interviews and additional paid time off, as well as short-term disability benefits. Others raised managers’ salaries and increased the bonus pool available to their employees. Some even offered debt-free college degrees in the fields of agriculture, culinary arts, and hospitality.

So what do local restaurant owners believe the future will bring? Those we spoke with are still feeling a great deal of uncertainty. One responded, “We’re taking it day by day.” Another felt slightly more confident thanks to the lessons learned so far: “We’re ready to take on the next challenge, whatever that might be.”