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3 Tips to Navigate through Labor Shortage in 2022

Smooth Commerce

Smooth Commerce

April 12, 2022 4 min read

3 Tips to Navigate through Labor Shortage in 2022

The restaurant worker shortage has been a problem for the industry. 

First, the good news: we could be nearing the end of the worst of it. According to the National Restaurant Association’s 2022 State of the Restaurant Industry report, the sector is expected to add 400,000 jobs, bringing the total industry employment of 14.9 million – higher than 2019 levels (13.4 million). 

But many are still dealing with labor shortage in the here and now. So here are some tips and tricks that help to ride out the wave.

Let’s set the table. The foodservice industry, in a continued downward trend, saw another 64,000 people quit their jobs in December according to the U.S. Bureau of Labor Statistics. 

In Canada, the Toronto Star found that since Feb. 2020 a staggering 180,000 workers have left the restaurant sector – around 10% total of workers pre-pandemic. 

Why are so many restaurants short staffed?

Precarious conditions over the past 18-plus months have created unprecedented hiring challenges,” said Restaurants Canada President and CEO Todd Barclay. “ The hard-hit foodservice industry deserves a plan to … avoid a long-term labor crisis.

According to a National Restaurant Association report, hiring front-of-house employees, like bartenders and hosts, has been difficult, while other HR executives say back-of-the-house workers are toughest to find.

Mirroring this, in Restaurants Canada’s mid 2021 survey, 80% of employers said they were having a ‘difficult’ time hiring back-of-house staff while 67% said there was trouble filling front-of-house positions. 

“The current unpredictability in this hiring environment is extremely challenging,” an HR executive told the National Restaurant Association. “Before the pandemic, we would hire college students … This year, there wasn’t an influx of applications at all. It’s been a very slow flow.”

In the contemporary restaurant industry, North America wide, good workers are hard to find and even harder to keep. Here are some ideas to find and keep employees. 

Retention is Key

Retention should be priority number one. Existing staff are more valuable than ever during a restaurant worker shortage. 

These are the people you need to keep your restaurant profitable while giving your establishment the capacity to train new staff. Time spent looking for and training new employees adds up quickly – more on this later. 

A good – and inexpensive – way to keep employees happy and boost retention is holding regular one-on-one meetings. This allows employees to be heard and have their work recognized, creating a supportive atmosphere that fosters problem solving and trust. Research has shown that 82 percent of employees are significantly happier when they feel recognized at work. 

Consider adding more competitive benefits. Upon first glance this is not the most attractive idea but often it can save on your bottom line. The Society for Human Resource Management (SHRM) found, on average, it costs $1,500 to replace an hourly employee.

 “(Losing hourly employees has) a real snowball effect,” said an executive in a SHRM article. “Employee retention has taken on a new significance amid one of the tightest labor markets in the past 50 years,”

Considering this, finding extra room in the budget may save you money in the end. Ideas for competitive benefits can range from free-shift meals and year-end bonuses to profit sharing, higher wages or health insurance. 

If implemented correctly, this can boost retention, encourage more efficient work, and help with recruitment.

The data shows that offering more benefits – including bonuses and higher wages – to combat the labor shortage is becoming more mainstream. The Ohio restaurant association conducted a business impact poll featuring hiring related questions. 

  • 42% say they’ll increase wages 
  • 39% want return-to-work incentives funded by the American Rescue Plan 
  • 28% think retention bonuses are a good solution 
  • 26% think marketing the industry as a career could help

But if an employee does choose to leave, consider what you can learn. Exit interviews are a candid way for an employee to offer an explanation for why they are leaving, giving introspective details you may have overlooked. While potentially tough to hear, there may be insight you can leverage in the future to avoid further attrition. 

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Spread the Word

People who work in the restaurant industry tend to socialize with others in the industry. Creating an employee referral program, that offers motivation and incentives, is a great way to bolster the quantity, and often quality, of help. 

When it comes to job postings, there has been success when posts use attractive, edgy wording and graphics to catch people’s attention.

Help your Employees Earn More

Tipping is an asset – at no expense you – and should be viewed as such. There are certain things management can do that has a direct influence on the dollar amount and quantity of tips a server can make. 

A simple way is including a suggested tip option on each POS machine. Restaurateurs have reported higher tip rates and servers are happy to take more tables while the customer saves time not doing mental – or physical – arithmetic to calculate tips, enhancing the overall efficacy of the restaurant.

About Smooth Commerce

Smooth Commerce is an all-in-one digital commerce  and customer marketing platform for restaurants that combines online and mobile ordering, delivery, loyalty, and powerful marketing tools to help you grow your business and navigate that restaurant worker shortage. If you would like to learn more or talk to a representative from Smooth Commerce about how our platform can help you meet your menu goals, contact us at learnmore@smooth.tech.

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