Decrease in Restaurant Labor

by | Feb 26, 2024 | blog, Business, employment, Industry News, National Restaurant Consultants, Trends | 0 comments

Despite restaurants’ role in increasing jobs in 2023 and overall projected industry growth for 2024, the restaurant sector of the hospitality unfortunately reported a small decrease in jobs for January 2024. Nation’s Restaurant News (NRN) reports, “The U.S. economy added 353,000 jobs in January as hiring accelerated and far exceeded expectations of 180,000. According to the U.S. Bureau of Labor Statisticsjobs report released Friday morning, the unemployment rate remains at a steady 3.7%. The hospitality sector added 11,000 jobs during January, however restaurants and bars specifically lost 2,400 jobs.”

While this number is a small percentage of the workforce, it is worth noting and recording to hopefully avoid a steady shrinking of the restaurant labor pool and related patterns. “This marked just the third time in nearly two years the industry lost jobs on the month, though it still employs 12.3 million positions,” the NRN blog post continues. The restaurant industry has been a mainstay of employment and economic stability for many.

Experts still recognize opportunity for growth and hold fast the 2024 forecast that predicts major industry growth nationwide, so it is very likely that January’s numbers are a reflection of post-holiday reorganization rather than an indicator of trends to come. “According to a recent survey from the National Restaurant Association, 88% of operators said they are likely to hire additional employees in the next six-to-12 months, while 62% of operators said theyre ‘very likely’ to expand payrolls. This bullishness extends to both limited-service and full-service operators.”

NRN also reports that conversations around wages will be key in the growth of restaurant workforce, especially with new compensation bills passing in California. “This year as Californias AB 1228 is set to go into effect April 1. The bill raises the minimum wage for quick-service workers to $20 an hour, from the states current minimum wage of $15.50. Though written explicitly for QSRs, it is expected to intensify competition over workers across the restaurant industry and other sectors,” the Alicia Kelso writes, and restaurant professionals are making labor and pay adjustments in preparation. 

Richard Weil, principal, and owner of National Restaurant Consultants notes, “Job growth in the food service and hospitality industry most likely will continue to increase as the industry eclipses the $1 trillion dollar mark.  The real question will be, where do we find the right qualified staff?  And even more importantly, how will we retain staff?  This equation really starts and stops with your restaurants culture.”

It is crucial to track and analyze industry trends and make adjustments accordingly, however, restauranteurs must ultimately not only plan for employees, wages, and related operations based on the health of their own business. It is imperative that each operation employs the right culture. Our Operations Analysis is tailored to individual establishments and our restaurant consultants’ base recommendations specific to the needs of the client as well as reviewing the culture that has been created. Fortify your workforce based on your business’s needs and projected growth by working with a restaurant consultant today.

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