A bad labor situation just got worse

New data shows that the universe of potential hires is growing far more slowly than the number of jobs being created by restaurant openings.
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The restaurant industry’s staffing challenges intensified in December, with the number of jobs to be filled climbing 2.4% and turnover hitting an all-time high, according to new data from People Report.

The month capped a historically difficult time labor-wise for chain restaurants, according to the company, the human resources specialist for researcher TDn2K. People Report found that three out of five chain operators (59%) had a tougher time finding new management hires during the fourth quarter of 2018 than they did during the same period of the prior year.

Recruiting hourly employees was even more of a strain, with seven out of 10 operators (68%) characterizing the effort as more taxing than it was a year ago. 

A rise in the turnover of both management and hourly employees during December intensified a Catch-22 for many chains, according to TDn2K. New data from its other research divisions showed a strong correlation between good service, as indicated by customers’ favorable asocial media mentions, and unusually strong sales and traffic growth. Yet improving service was more difficult because employees jumped to other employers before they could master their current jobs, resulting in “large portions of the industry’s employee base” being “not fully trained and unengaged in their jobs,” TDn2K concluded.

The situation was also worsened by the industry’s continuing expansion binge, the researcher said. The rate of restaurant openings continues to exceed human population growth, escalating competition for customers and new hires to withering levels, according to TDn2K’s analysis.


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