Workforce

Hourly turnover could be a bright spot for restaurants in 2018

Restaurants saw some relief on hourly turnover last month, according to research firm TDn2K. But before operators get too optimistic, management turnover continued to increase through November.

For the last three months, hourly turnover has been on the decline, according to the firm’s Restaurant Industry Snapshot. On the other hand, restaurants are continuing to report some of the highest management turnover that they’ve seen in the last 10 years—a trend that will likely carry into 2018, according to TDn2K.

Swelling management turnover rates might be especially damaging to operators. The company’s People Report studies show management retention impacts restaurant’s sales and traffic performance. Raising base pay, boosting bonus targets and investing in manager training and development have helped increase management turnover, according to the research.

Although retention is a major pain point for restaurant operators, finding talent to begin with can be a hurdle when the national unemployment rate clocks in at 4.1%, according to the Bureau of Labor Statistics. Although the U.S. added only added 148,000 jobs last month, the economy still ended on a high note over time, said Joel Naroff, president of Naroff Economic Advisors and TDn2K economist, in the report. “Job gains averaged a very strong 204,000 per month during the final quarter of the year," he said. "Given the lack of workers, that pace is likely to be unsustainable. The strong demand for new employees boosted hourly wages, though, adjusted for inflation, the increase was not great.”

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Marketing

Older brands try new tricks in their quest to stay relevant

Reality Check: A number of mature restaurant chains are out to prove that age is just a number.

Financing

At Papa Johns, delivery shifts from its own apps to aggregators

The Bottom Line: The pizza delivery chain’s business with companies like Uber Eats and DoorDash is thriving while its own delivery is slowing. But this isn’t the beginning of the end of self-delivery, CEO Rob Lynch says.

Topics

How the shift to counter service has changed Steak n Shake's profitability

The Bottom Line: Sardar Biglari, chairman of the chain’s owner Biglari Holdings, details how the addition of kiosks and counter service has transformed restaurants.

Trending

More from our partners