Industry Trends, TES Insights
Labor Shortages in Quick Serve and Fast Casual Restaurants
How to Handle Labor Shortages in Quick Serve and Fast Casual Restaurants.
Restaurants are in a tough spot when recruiting and retaining staff. Lower-pay industries like fast food have struggled to attract workers with the economy rebound. Americans are rushing back to restaurants, but many still need to be more staffed. The restaurant industry has tried to lure workers back with higher wages, but it may need to change some of its culture and practices.
Many fast-food chains say they can only raise workers’ pay by jeopardizing profits or raising prices. Traditionally, the prevailing wisdom was that small, low-wage businesses like restaurants suffer when the minimum wage increases and are more likely to cut jobs and raise prices. But a new study co-authored by UC Berkeley economist Michael Reich found that small businesses actually benefit when governments raise the minimum wage. This is because most small business owners work in “pass-through” industries, where profits go straight into operating costs and salaries for the owner before any remaining profit is calculated.
This is especially true for fast food and quick service restaurants (QRS), which typically employ many employees. But if restaurant employees are already stressed, more than higher wages may be needed to attract or retain them. Many brands have started adding perks, such as recognition programs and flexible scheduling, to counter this trend to show their employees that they care about them.
Simple changes can help restaurants solve their labor problems and retain employees.
Get serious about online recruitment!
The restaurant workforce is getting smaller with the economy improving and many people are finding higher-paying jobs. With labor shortages abounding and turnover already brutal (which brings costs to the business), savvy restaurant owners need to start thinking outside the box regarding hiring and retention strategies.
QSR needs to adjust hiring and management practices to reduce employee turnover.
Use online recruiting effectively and consistently. According to market research firm IDC, nearly 40% of small business hiring managers say that postings on Indeed and other major job boards are a vital source of new hires.
Recruiting is an important part of the restaurant business, especially when it comes to finding high-quality employees. Luckily, the Internet makes reaching a larger pool of potential employees more manageable than ever. Whether you’re searching for food preparation or customer service workers, online job boards are an effective way to find candidates for your restaurant.
In addition to posting jobs on major sites, restaurant chains should use local job boards, such as Craigslist and Google for Jobs. These sites help employers reach a wide range of potential applicants, making them an excellent option for fast-food restaurants.
Other online recruitment tools include virtual career fairs. These events allow restaurants to meet prospective candidates in a comfortable setting and often offer more flexibility than traditional hiring processes. They can also be held onsite or offsite, depending on the needs of the business. An onsite fair allows the company to continue operating during the event, an advantage for some restaurants.
QSRs can mitigate the labor shortage crisis and position themselves for continued success in the future. Using solutions like HourWork, a recruitment and retention platform designed for quick-serve restaurants, can help make it easier to attract and keep quality employees.
Restaurants can also hire from within by promoting current employees to new positions. This can speed up the onboarding process and save money by reducing recruitment and training costs.
Indeed, the largest Job Search site, Price Changes, had a negative impact on some small businesses.
Many QSRs and small businesses use Indeed for recruitment. The job-search site’s switch to a pay-per-application model led to surprise charges, prompting the company to backtrack.
Indeed.com changed how it charged employers for connecting them with job seekers. It was supposed to be better for small businesses because they could choose which applications to review and pay only for the ones they liked. It created more costs for many business owners, and now Indeed is trying to minimize the fallout.
One pain point: Indeed, gives employers 72 hours to reject applications they don’t like—or incur a fee for each application. For some employers, those charges have added up to hundreds or thousands of dollars. Indeed, it acknowledged that the company made missteps in the rollout and is still working out the kinks. “This is still a product in evolution, and we are taking customer feedback, ” quoted an Indeed representative.”
Follow up on Applicants with a phone interview first.
The restaurant industry has always struggled to recruit and retain talent, but these challenges have become even more difficult during the current labor shortage. As a result, restaurants are making significant adjustments in their recruiting and hiring strategies.
Using a phone interview allows you to screen applicants more efficiently. Do they arrive on time for the phone interview and are they well prepared.? This call can significantly affect your chances of creating a rapport and evaluating the applicant to avoid the “no-show” hire. You can also determine how well they will handle issues by asking situational questions like: “Tell me about a time when you had to handle a difficult customer.” The answer should tell you how the applicant solves problems and uses their communication skills.
Cross-Train, Your Staff
When staff members are cross-trained, it can alleviate stress and prevent a lot of the headaches that come along with short-staffed restaurants. For example, if your bartender calls out of work, you may be left with no one to serve drinks, leaving customers frustrated and dissatisfied. However, suppose your server or another host team member is cross-trained to act as a bartender in a pinch. In that case, you can continue serving your customers, and the problem will be resolved quickly and efficiently.
Training your employees to take on different roles can also make your restaurant more flexible regarding scheduling. For example, if an employee prefers evening shifts but you are in a labor shortage, forcing them to do mornings can damage their morale and lead to turnover. Instead, make sure you take your employees’ personal preferences into account when creating their schedules to help them feel valued.
Consider Restaurant Automation
When many people think of automation, they envision Siri or Alexa or a machine that prepares your food. For restaurants, however, this trend means more than just a robot. It has also brought in self-service kiosks and POS systems to help manage the restaurant’s inventory, customer database, and more.
The companies that make these automated tools claim various benefits, including less employee workload and faster service. For example, Ziosk, which produces tablets that allow restaurant guests to order from their tables, claims its products cut table turnover time by six to nine minutes.
Restaurant technology can help ease the pains of the labor shortage. With new software that automates repetitive tasks, staff can focus on customer service and other higher-value activities. Restaurants can also streamline back-of-house operations using automated equipment and tools.
For example, restaurant POS systems can be configured to generate QR codes that let customers digitally download menus to order and pay without needing an in-person server. Other restaurant technology solutions like predictive prep lists and food inventory management can reduce waste and spoilage while reducing employee burnout.
But if you’re considering this option, be careful not to cut out too much of the human touch. Customers may feel confused by the absence of a human to explain the process or answer their questions. And if you’re automating the kitchen, it is crucial to have someone on hand to communicate special requests, like eliminating an ingredient or providing an alternative.
Whether you use automated software or a human employee, it’s important to focus on the core tasks only a person can do. This will improve your bottom line and help you recruit and retain good workers.
What would encourage them to stay?
Higher wages are only sometimes the answer to hiring and retaining employees. Many brands have started adding perks such as recognition programs and flexible scheduling, designed to show their employees that they care about them.
Another simple way to do this is by promising to provide staff meals at the end of every shift. This may seem small, but it can greatly boost overworked employees.
In addition to a clear job description, highlighting professional development opportunities and paid company events can help attract and retain employees. Offering extra shifts and overtime can also be incentives for employees to stick around, even in the face of a tight labor market.
Create a more diverse and equitable work environment. This widens the pool of potential employees and helps to build stronger teams. For example, by fostering a more welcoming workplace for women and those with disabilities, restaurants can attract new talent and improve overall performance.
Another way is by implementing standardized processes and software for all of your locations. This can make scheduling staff, swapping shifts, and adjusting for peak times easier. It can also help managers who may work at multiple locations to be more consistent in their approach and better understand which locations are performing well or underperforming.
What would encourage them to stay? A survey of food service workers by One Fair Wage revealed the following wish list:
A full, stable, livable wage with additional tips (78%)- Paid sick leave (48%)
- Increased hours (38%)
- Better health insurance (37%)
- Less hostile work environment (37%)
The food service industry has struggled to fill positions throughout the pandemic. As more Americans return to restaurants, a growing number of franchises report struggling to hire enough workers.
Restaurant turnover is already high, and the labor shortage is making it worse. High turnover costs businesses time and money as they invest in training new employees and spend time looking for replacements. This cost of hiring new can be offset by retention.