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Restaurant job growth surged again last month

The industry has added more than 80,000 jobs over the past two months despite rising labor costs.
Photograph: Shutterstock

Restaurants added nearly 37,000 jobs in January, according to newly released federal data, as the industry shrugs off labor-cost fears to continue its long-term expansion.

Food services and drinking places added 36,600 jobs in January, according to the U.S. Bureau of Labor Statistics, and now employ more than 12.1 million people—up by more than 280,000 over the past 12 months.

And hiring seems to have picked up notably in the past two months. Restaurants have added more than 80,000 jobs over the past two months—double the rate of hiring from the previous 10 months.

The rate of industry hiring came during a surprisingly robust month for overall job growth. The economy added 304,000 jobs in January despite some economic concerns and the federal government shutdown.

The unemployment rate increased to 4%, however, as more people entered the labor force.

Still, restaurants continued to hire at a faster rate than the overall economy. Over the past year, the nation’s eateries have increased employment by 2.4%, including 0.3% in January alone. By contrast, the overall economy has increased the number of jobs by 1.9%—and 0.2% last month.

The robust hiring should ease concerns about an immediate, pending recession. And for restaurants, it is a demonstration of faith by operators in their prospects for sales growth.

Industry same-store sales picked up late in 2018, with same-store sales up 1.4% in the fourth quarter, including 2% in December, according to the Black Box Intelligence index.

But the rate of job growth in the industry is also bringing up labor costs as companies increase wages to lure workers that are increasingly difficult to find. Average hourly earnings in the leisure and hospitality sector have risen nearly 4% over the past year, compared to 3.2% for the workforce as a whole.

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