Your Restaurant’s Guide to Overcoming the Labor Shortage

Winning The War on Talent

The hospitality industry has faced many challenges in the aftermath of the COVID-19 pandemic. Even two years after the outbreak, we continue to see its ever-changing impacts on the industry. Though some aspects have certainly improved with time, it is without a doubt that there are still many barriers to face. In 2021, hospitality business owners experienced record-breaking labor shortages. This all-time high staffing crisis hit the industry at a magnitude we have not seen in decades. Job openings and worker resignation rates are at record highs and show no signs of slowing. In April 2021, Forbes reported that 4 million workers left their jobs, increasing the number of job openings to 9.3 million – a new record. 

Before we share solutions to this unprecedented labor shortage, we must first understand why this is all happening.

What Led to This Labor Shortage?

The underlying causes of the labor shortage are multifaceted. It appears that one of the biggest reasons may be the fact that many employees have left the industry to find more stable jobs. Having experienced such a sudden and immense shift in the restaurant industry as a result of the pandemic, workers still worry that a large and devastating change could happen again.

Also attributing to the labor shortage dilemma is the battle between stagnant, unchanging minimum wages and relatively positive unemployment benefits. Post-pandemic benefits such as government stimulus checks often meant workers earned more by not working than in the restaurant workforce.

Additionally, the number of teenagers in the labor workforce is half the size of what it used to be over 25 years ago. This makes it hard to find people willing to work in lower-earning, entry-level positions. Other factors such as increasing immigration enforcement and ever-changing pandemic regulations in the industry may also worsen the magnitude of this labor shortage. 

Knowing the root causes of why your establishment may struggle to fill roles and keep staff will help you overcome some of these issues. We’ve put together a guide with tips that can help your establishment thrive in this job economy.

WEBINAR - HOW TO OVERCOME THE HOSPITALITY HIRING SHORTAGE

Are you struggling to find and hire great talent, retain staff, and rethink your day-to-day operations? Download the webinar recording below to hear from 3 hospitality industry professionals and learn how they’re adjusting their operations to meet new employee expectations. 

Outreach

While many factors are out of our control, there are a few things that you, as an establishment owner, can do proactively to help lessen the effects of the labor shortage.

Recruiting Talent

Even though there may be a smaller pool of viable talent in the industry due to the shortage, there are changes to HOW you recruit talent that can make a difference.

One way to do this is by reaching out to local colleges and universities within your community to find talent there. By partnering with local organizations or high schools and getting involved with job fairs, after-school programs, and other grassroots initiatives, you can attract and build a relationship with budding talent before they enter the workforce. An interactive way to build these relationships is to offer free training or skill-building workshops for people entering the labor force. This is a great way to get exposure and possibly make an exchange for a term of employment!

Oz. Tap House Staff Crew
Staff trained at checkout for self-pour beer wall

Another recruitment option is to get help from a professional company. By partnering with recruiting agencies, you can expand your talent pool and reach a larger audience of potential hires through their network. Although this may not be a free option, these agencies are very effective and provide you with great tips and advice. We’ve listed some examples of staffing agencies below:

DAY-TO-DAY RECRUITING STRATEGY

You can’t train someone to be a good person, but you can train them to do what you want them to do. Keep your eyes out for potential employees when running your daily errands. Whether in Staples or at the grocery store, always keep a business card on you. Seek out good people, and even though they are not currently working in the restaurant industry, ensure them there is a spot at your location and that it will be a smooth transition with loving people by their side.

Referral programs

If you don’t currently have one, create an employee referral program to motivate current staff with rewards when they refer someone to work for you. Not only does this improve the quality of new hires, but it also saves you time and money because you no longer have to spend time recruiting talent. Great workers will only refer someone they are confident will get the job done well because it reflects on them. Word of mouth travels fast, so if your employees love going to work every day, they are likely to relay that message to their friends. 

When creating your program, offer incentives! A simple way to set up a referral program is to provide a $300 bonus for bringing in an employee. The bonus is not received until the new employee works for 3 months. This ensures workers only bring in reliable and hard-working candidates. Recognize the employees for referring candidates to motivate them to refer more people and bring attention to the program in front of other workers. Track the success of the program and update the incentives if necessary.

Events

Another form of outreach your establishment could benefit from is hosting events. These events could be related to hiring or staffing, but they don’t have to be! Hosting events of any kind creates a buzz within your community and helps expand your name and reputation within the industry. 

You can join forces with breweries in the area and conduct events like a “Tap Takeover” to introduce new and fun beers to your customers and even reach a new audience of people. Don’t forget to promote these events on your social pages to market to an even broader audience! 

Check out this link here for some different event ideas you could host!

Technology

Technology proves to be a clear path to increase efficiency and convenience within the hospitality industry, which is why bars and restaurants are choosing automation to overcome the staffing crisis. Yelp even states, “If restaurant owners can automate specific steps in the diner experience, the savings on labor costs can be re-distributed as higher wages to their employees.” As a result, there has been a significant increase in the number of restaurants investing in technology in 2021. Statista reports that the interactive kiosk market revenue reached a whopping 28.34 billion dollars, a 6.4% increase from 2020. 

Not only is this advancement in technology helping businesses meet new customer demands, but it’s also allowing businesses to stay afloat and operate with less staff. Below, we will outline a few rising trends that can help your establishment overcome these challenges.

QR codes

Invented in Japan in 1994, QR codes have been around for some time now. However, they were most common internationally. This was mainly because until 2017, Apple’s smartphones were unable to natively scan QR codes without a third-party app, which limited their ease of use. Once the pandemic hit in 2020, they quickly grew in popularity thanks to their ability to reduce the spread of germs and contact points. 

Now, restaurants continue to use QR codes as an easy way for guests to access their website and menu. Many restaurants have even implemented contactless ordering and payment methods right from the table to reduce interactions with servers.

If your restaurant is struggling to find servers, add contactless ordering/payment methods to your operations. You’ll reduce the number of servers needed to quickly and efficiently serve guests, and 66% of diners said this would increase the likelihood they would place an order at your venue. Place your QR codes right on the table in an easily accessible spot. Diners can scan, order, and check out all from their phone! Over the last year, 80% of consumers have used contactless payment options. Not only is this a safe way to maintain distance during the pandemic, but it also reduces the need for cashiers or excess staff.

Bbot, an online ordering service, is a great tool to use. You can customize your menu, and guests can order on-site or place a takeout or delivery order right from their phones. Many establishments have found that using QR codes increases sales because guests are likely to select more items. The tech makes it easier for customers to get what they love, and it reduces staff burnout since they don’t have to run around checking in half as often.

For my operations, Bbot is monumental. It allows independent food hall vendors to all sync onto Bbot, thus allowing guests to order everything at one time. The QR code enables guests to order and pay on their own, so we don't need a cashier and operate with 1-2 fewer team members.

Gardy Desrouleaux, Managing Partner at Craft Food Hall

Reporting

Key performance indicators can help you track and measure your businesses’ performance and quantify your metrics to see where changes need to be made. Conducting a deep dive into your reporting will allow you to reevaluate your operations. 

Do your hours of operation make sense? Maybe your business should only open for a short timeframe when you are bringing in the most sales. Review your RevPASH and average customer headcount to understand what times bring in the most revenue and when your busy/slow periods are. This will help you determine the best times to open and close your doors.

Are you scheduling too many staff members at the same time? Look at your labor costs to optimize your scheduling of staff. 

We recommend looking at this list of 25 essential bar and restaurant metrics to focus on ways you can increase your sales with less staff. Many POS technologies analyze this data for you, making it easier than ever to report on this data!

Self-Serve Technology

As mentioned above, self-service technology has taken the hospitality industry by storm. Many big-name brands are adding self-serve kiosks to their operations to optimize efficiency and reduce guest wait times. Tillster predicts that by 2024, the self-service kiosk market will reach 30.8 billion dollars. So, if you haven’t already, it’s time to consider self-serve beverage technology as an option for your establishment!

With self-serve beverage technology, operators have…

  • Reduced labor costs by 20% or more
  • Increased profits by 45% or more
  • Increased service efficiency by 4x
  • Reduced waste to as little as 3%

Self-pour beverage walls are the perfect solution for overcoming the staffing crisis. It allows business owners to operate with fewer staff members while maximizing the number of customers served. This leads to a significant increase in sales. And the operators aren’t the only ones who love the benefits it brings! Customers love having control over their entire drinking experience and sampling as many beverages as they want.

Check out this video to see how our self-pour technology can help you reduce the number of staff needed in your establishment all while increasing your beverage sales and boosting efficiency!

Malcolm Yards, a PourMyBeer family member in Minneapolis, MN, is taking advantage of the benefits self-pour brings. When comparing the total revenue from their 32 self-pour tap wall to their bar, they found some astonishing numbers. 

Beer from Malcolm Yards
Tap Wall at Malcom Yards

Download the case study below to learn which setup (traditional or self-pour) brings in most of their total alcohol revenue, where most of their pours come from, and how much staff is needed to operate each. 

To access the case study, fill out the form below.

How PourMyBeer is helping operators overcome labor shortages

If you’d like to learn more about our self-serve technology and the benefits it could bring to your establishment, contact us below!

Internal Adjustments

DO NOT SETTLE, HIRE THE RIGHT EMPLOYEE

For restaurant owners, having potential employees show up for an interview is 50% of the battle. Although it is hard to find candidates, do not settle. Your workers are a reflection of your business. You can train someone to be a waiter/waitress, but you cannot train them to be a good person. Look for a person who will fit into the culture of your organization. When interviewing potential employees, a good thing to keep in mind is the Danny Meyer strategy.

  • Empathy – Caring and aware of how their actions will make others feel.
  • Self-awareness – An understanding of themselves and how they handle situations.
  • Optimistic warmth – Glass is half full, not half empty mentality. 
  • Intelligence – Eager to learn.
  • Work ethic – Go-getter mentality.
  • Integrity – Take accountability for their actions, do the right thing, and use judgment before taking action.
RegionAle Team

Currently, operators are desperate and will hire the first person who wants the position. To stray away from hiring the first employee interviewed, use a scorecard to rank them in a series of categories during the interview. It will be a good thing to look back on and an easy way to compare candidates. 

Also, ensure you are asking the right questions. Questions such as what are your weaknesses, where do you see yourself in 5 years, and why should I hire you, do not provide you with the information needed to tell if they are a good cultural fit. Instead, ask, what is teamwork to you, what was one area your manager asked you to improve on, and how would you rate your previous bosses, which will allow them to provide insightful answers. 

ONBOARDING, ORIENTATION, AND TRAINING

When hiring new employees and training current employees on new procedures, ensure that the process is easy and efficient. You do not want to create overly time-consuming training procedures. This will deter new employees from staying past training. Many people are looking to get hired, start working and make money. 

Introduce the new hire to each member of the team. This will make them more comfortable and create the amazing culture every owner wants. During this orientation/training process, the new hire will see the everyday tasks of each employee and learn a lot through visual learning and hands-on training.

Training costs can be expensive for independent restaurants, but there are methods and tools to ensure new hires get taught what they need to know at a low cost. Tools like Trainual have a low monthly cost and allow operators to build out their training online through pictures, videos, and text and pass it to all employees. It is a hefty workload in the beginning, but helpful in the long run. 

If you have not done so in a while, reevaluate your training process to ensure it is as productive as possible. Also, assure that all employees get trained on the new technologies implemented in your bar or restaurant.

Perks and Benefits

Many hospitality workers left the industry for more stable jobs, but 55% of surveyed job seekers said they would consider taking a lower-paying job if it offered attractive benefits. Right now, many are seeking out positions where they will receive health insurance, sick and parental leave, and the ability to work flexible hours. Many restaurant workers are also looking to get jobs at businesses offering non-tip wages when setting up, breaking down, and cleaning. If you can create more stability through your perks/benefits, you will increase your employee retention rate and attract new employees! 

If you cannot provide 100% dental, medical, and other coverage, that is okay. You have to sell the potential employee on your business. People want to work in a company where they feel valued. Sell, sell, sell your company! You are not just interviewing them, but they are interviewing your company to see if it will be a good fit for them. Make sure to highlight your company’s 5 F’s: fit, family, freedom, fortune, and fun. Is it a good fit for them? Will they make decent money? Will they have fun going to work? Is there room for growth? These benefits are perks for them and are more essential to happiness than providing complete coverage.

In addition to selling the company, you must sell the job itself. When posting job openings online, make it seem fun and enticing! Show who your company is and what that person will join when they work for you. Many people want to work somewhere with a fun and inviting work culture, and when applicants see a little bit of your business’ personality online, they’ll get excited about applying.

girls enjoying pourmybeer
Crave Hot Dogs & BBQ Team at Pflugerville, TX Location

Feedback and Exit Interviews

Getting feedback from your employees is so important. For workers to feel comfortable and willing to work in a difficult industry, they must be able to speak their minds. Shiftnote is a flexible platform that allows team members to add feedback in an organized manner for you to review and act on.

Conduct exit interviews when staff members leave your business. This will give you insight into why staff leave and where you can make improvements if necessary. However, it is preferable to check in with your staff regularly to try and resolve any issues before they quit. It will also allow you to focus on your current employees and how you can retain them before looking outside your organization.

What is the future of staffing?

No one can really say, but owners, operators, and managers need to find ways to alter operations to meet consumer needs while operating with less staff. Despite being the most labor-intensive industry, technology acts as a crutch to increase the speed of service and improve customer satisfaction. Navigating the labor shortage is difficult, but the restaurant industry has always had its challenges. Owners, operators, and managers have continuously found ways to manage the challenging landscape.

We hope you’ve found some of these solutions helpful when overcoming staffing issues in your establishment. If you need help hiring and maintaining your staff, check out our guide below! 

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