Few industries felt the impact of COVID-19 more than restaurants. Yet even as case rates go down and government restrictions fade, restaurants continue to struggle with the labor shortage the coronavirus left in its wake. High restaurant staff turnover has always been an issue, but the pandemic sparked a labor shortage much larger and more pervasive than ever before.
A National Restaurant Association survey conducted in April 2021 found that 84% of bar and restaurant operators are struggling with lower-than-normal staffing levels. Nearly half those surveyed were operating with more than 20% fewer employees than they had pre-pandemic. But how did the restaurant industry get to this point, and more importantly, where does it go from here?
What Caused the Restaurant Staffing Shortage?
Coronavirus created the perfect storm for a U.S. labor shortage—especially in the service industry, where the debate over rising wages has been raging for years. The issue that’s received the majority of the media’s focus is unemployment insurance. However, recent studies by BTIG and Snagajob suggest that UI benefits might account for a smaller percentage of unfilled jobs than previously thought. A survey of 300 unemployed people by BTIG found that only 6% admitted they were waiting for unemployment to end before applying for work, while a similar survey by Snagajob returned a rate of 4%.
So what are the other factors contributing to this declining workforce? Competition, for one. During the peak of COVID-19, a substantial number of service industry workers who were laid off found employment in other industries that were less impacted by the shutdown. Now that restaurants are reopening, operators are forced to compete against each other for a smaller pool of applicants. This competitive environment allows restaurant workers to choose positions with higher pay or better benefits. Of course, this puts smaller restaurant operations at a disadvantage, since larger franchises can typically afford to offer these higher wages.
Another factor to consider is the geographical shift that occurred during the pandemic. Many employers transitioned to a remote-work model, which allowed their employees to work from anywhere in the country. This sparked a significant exodus out of cities and into suburbs and rural areas. Not only did restaurant workers follow spouses and other family members who went this route, but many in the service industry left cities for another reason. In an interview with CNBC, Danny Meyer, the founder of Shake Shack, suggested that restaurant workers left cities because they could no longer afford expensive rents without their pre-pandemic wages.
Of course, these are only a small handful of the reasons why restaurants are facing a post-COVID labor shortage. Health concerns, fears about another shutdown, and family issues—especially a lack of childcare—all play a role in the declining number of job applicants. Whether this is a temporary problem or one that will eventually resolve itself is yet to be determined. However, it’s important to learn from and adapt to these labor shortages as quickly as possible to ensure a smooth and continuous operation for customers.
Improving Efficiency During the Labor Shortage
When it comes to operating a restaurant with a leaner crew, efficiency is key. This includes updating both front-of-house and back-of-house processes. The overall goal is to maintain a consistent level of customer service and food quality so that these changes never negatively impact patrons. This may be easier said than done, obviously, but recent innovations in service and equipment can make the transition less difficult.
Switch to a Limited-Service Model
Social distancing, shutdowns, and strict capacity caps forced many restaurants to adopt a limited-service model during the height of the pandemic. Limited service can take a variety of forms, including shortening business hours, offering a reduced menu, and opting for delivery, curbside pickup, and ghost kitchens instead of traditional dine-in services. Many of these operational adjustments can also help solve some of the issues created by a staffing shortage.
The trend towards remote work makes this option even more appealing. Now that so many employees work from home, restaurants have seen a significant decline in their typical lunchtime rush periods. This is especially true for restaurants located in downtown business districts and city centers. Since fewer customers are eating out for lunch, this means fewer servers and cooks are necessary to fully staff restaurants during midday hours. If the number of diners dips too much, this could disincentivize restaurants from offering lunch entirely. However, it can also offer an opportunity for operators to hire a leaner lunchtime staff whose time is split between serving lunch guests and cleaning and prepping for dinner service.
Restaurants experiencing a reduction in dine-in guests during lunch can also channel their resources into expanding premade meals and grab-and-go options. Not only does this tactic require fewer waitstaff, but it allows regulars who now work from home to swing by for convenient, premade options that work better with their new flexible schedules.
Save Time with Premade or Precooked Ingredients
Every restaurant wants to serve their diners the freshest, highest-quality meal possible. However, all that chopping, sautéing, fileting, and baking takes a lot of labor and time. Premade ingredients—whether it’s produce that’s already washed and diced, or a protein that’s already broken down and deboned—can save the kitchen staff hours of prep time without sacrificing too much quality. Though premade ingredients will add a bit to your food costs, the time savings might be worth the bump in budget, especially if you’re understaffed in the kitchen.
Another way to boost efficiency during food prep is to use off-peak hours to pre-cook popular menu items (or those that take the longest to prepare). Now, this is something that most restaurants already do when it comes to large-batch items that are easy to keep warm on the stove or in a steam table, such as soups, sauces, and certain side dishes. However, this same method can be used, at least to some degree, for items that would typically be made to order.
For example, chefs might consider slowly cooking up small batches of chicken or beef in a sous vide cooker or combi oven, then searing each portion to order during service. Chefs can also prepare large batches of menu items that reheat well, such as pastas, and put them in the blast chiller so that they only need to be brought to temperature in the oven before serving. The key to success here is to create a back-of-house strategy that relies more heavily on efficient, multifunctional equipment—cook and hold ovens, for example—than a traditional assembly line operation that requires a larger kitchen staff.
Take Advantage of New Technologies
For restaurants struggling to operate while understaffed, technology can be a lifesaver. This is especially true for any technology that automates low-skill tasks that would normally tax your employees’ time and energy. For example, foodservice establishments can boost efficiency with innovative technological advancements, such self-cleaning cooking equipment and dishwashers with WiFi connectivity that notify operators when chemicals are low.
In the front of house, self-ordering kiosks and other contactless POS systems can significantly diminish the number of restaurant staffers required in the front of house to take customers’ orders. Restaurants are also increasingly turning to mobile ordering apps to streamline the ordering and payment processes. Technologies like these have already made some headway into fast-food establishments, but they can function just as effectively in many fast-casual and limited-service restaurants experiencing staffing shortages.
Consider the case of Roy Rogers Restaurants. As part of an initiative to maximize efficiency and futureproof the chain for any other COVID-like scenarios, Roy Rogers began developing new store prototypes that recenter their focus on drive-thru sales. As part of this initiative, the prototypes include new digital drive-thru menu boards, a POS system that accepts mobile payment, and new technologies designed to accurately track the time spent on each order. The result: Roy Rogers has reduced the average time spent to process a single drive-thru order by 56 seconds, or nearly 20%.
Facing an Uncertain Future
COVID-19 changed the way restaurants will operate now, and into the future. How far into the future those changes will extend, we still don’t know. For the time being, restaurant operators must navigate a variety of challenges, including a much smaller pool of job seekers in the food industry. It’s impossible to say if that pool will ever match pre-pandemic numbers, but restaurants need to develop new processes and efficiencies now to offset the reduced workforce. Innovations in offsite dining options, equipment, technology, and even the food product itself will help restaurants continue to meet consumer demand—whether this is just a temporary bump in the road or our new normal.
- 2021 State of the Restaurant Industry: Where Do We Go After 2020?
- Rising Labor Costs: 10 Tips to Balance Expenses and Productivity
- Employee Turnover in the Food Industry Today
- What’s Next: 6 Emerging Trends for Restaurants Resuming Dine-In Services During COVID-19
- Reopening Your Restaurant Amid COVID-19
- How Home Meal Kit Service Can Boost Your Bottom Line
- What Are Delivery Only Kitchens?
Adriane works as a Content Specialist at Central Restaurant Products. She has more than a decade of experience as a copywriter and e-commerce strategist, with most of that time spent focusing on the restaurant industry. When she’s not writing about foodservice, Adriane enjoys cooking, hiking, traveling, and hanging out with her dog.