Customers are back in restaurants and bars, but workers have moved on

In August, she accepted a customer service position at Shipt Inc., a Birmingham-based grocery delivery service, and said she had no plans to return to the bar business. “It’s like someone woke you up,” she says of the career change.

After Covid-19 forced restaurants, hotels and bars to close last year, thousands of workers weren’t just sidelined from jobs. Many, like Ms Roshitsh, have turned to new careers in digital sales, shipping, mortgage finance and other businesses that thrived during the pandemic, which some economists believe could mark a lasting change on the labor market for hotel staff.

This exodus, they say, could lead to workforce problems for the sector that will persist well beyond September, when improved federal unemployment benefits that helped prevent some low-wage workers from returning to work. should expire.

In an attempt to attract workers, many restaurateurs and other hotel companies are increasing wages, offering signing benefits, and rethinking scheduling practices to make work more flexible and, in some cases, less exhausting.

As new labor market dynamics have caused these employers to scramble to find enough workers, they are helping many longtime cooks, waiters, hotel workers and other hospitality workers venture into new ones. activities, often with more predictable hours and better wages and benefits than their previous jobs.

At this point in the pandemic, says Brad Hershbein, senior economist at the WE Upjohn Institute for Employment Research, many such workers have “found employment elsewhere, perhaps at higher pay.”

The share of U.S. restaurant and hospitality workers leaving their jobs hit a two-decade high in May at 5.7%, according to the Labor Department. Although the latest jobs report shows restaurants and bars created 194,000 jobs in June, employment at these establishments remains down by 1.3 million jobs since the start of the pandemic. In contrast, employment has rebounded beyond pre-pandemic levels in many other sectors. Compared to February 2020, there are now 100,000 additional jobs in warehousing and storage, as well as 39,000 additional jobs in management and technical advice and 25,000 additional jobs in insurance and finance.

Data from hiring sites also shows a relatively high number of workers moving away from the sector: on Jobcase, a digital job site and social network for hourly workers, restaurant and restaurant job searches. in April were 35% lower than in the same period in April. 2019.

A LinkedIn analysis of people who updated their profiles with new jobs shortly after the start of the pandemic last year also found a higher level of career change among people in hospitality jobs. . Of those working in travel and leisure, which include jobs such as restaurant managers, banquet servers, and pastry chefs, 79% said they had moved into a new industry, well above ‘a more typical rate of 58% for people in this sector. The share of job changers who left the leisure and travel industry remained high until early spring, according to LinkedIn data.

The layoffs have pushed many hotel workers to find new types of jobs. Higher pay and other perks have kept many like Connor Cassidy from turning back the clock. The 23-year-old says he was making $ 5 an hour, plus tips, as a bartender at an Olive Garden restaurant in Raleigh, NC, when he was put on leave in June 2020 He ended up finding a job as a bank teller. earning $ 15 an hour – with the prospect of moving up the career ladder.

Because his job as a bartender required sales and customer service skills, “the transition wasn’t as difficult as I thought,” he says.

Timothy Carr, 56, who was fired from his role as sales manager at the Edgewater hotel in downtown Seattle in May 2020, says he has seen many colleagues move to other industries such as l real estate and insurance. Among colleagues who have remained in the hospitality industry, he says, many complain that they are being asked to do more to help keep understaffed operations afloat.

None of this makes looking back particularly appealing, says Carr, who, after 30 years in the hospitality industry, got his license to sell insurance in September and is now director of Shane Roehl, an agency. independent affiliate of Allstate. Body

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insurance network.

“I get headhunters calling me and saying, ‘Do I want to go home?’ I’m like, ‘No, this is where I am now,’ ”says Carr.

With many businesses operating under-staffed or with less experienced staff, online restaurant service complaints and negative reviews rose sharply in the second quarter of this year, according to restaurant analytics firm Black Box Intelligence. . His data shows that the tenures of sit-down restaurant managers, meanwhile, have declined by about a year to an average of six years since just before the pandemic.

The leisure and hospitality sector has long had the lowest wages for non-supervisory roles among major industries, according to the Ministry of Labor. But as employers have sought to attract workers, many are raising wages to better compete for the workforce. Mexican Grill Chipotle Inc.,

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Mcdonalds Corp.

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and Olive Garden-owner Darden Restaurants Inc.

have all announced salary increases this year. Aggregate hourly wages for non-supervisory workers in the industry rose more than 11% in June from a year earlier, the most of any job category, according to federal data.

But attracting more hospitality workers will require a broader overhaul, says Peter Saleh, analyst at Wall Street firm BTIG. In a June BTIG survey of 300 unemployed, respondents said better pay was the strongest incentive to return to hourly work, while good benefits and greater flexibility ranked higher. in the second and third row.

Hourly workers want “more work-life balance and better control over when and how they work,” says Saleh, who argues that restaurants will likely have to offer shorter shifts and more hours. flexibility to recruit and retain workers.

Large employers in the industry are starting to take this into account. McDonald’s franchisees say they surveyed thousands of their employees this year to better understand what they want in terms of pay and benefits, and are now exploring perks like childcare vouchers. and emergency transportation that can give employees more flexibility. Papa John’s International Inc.

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said this month he would spend around $ 2.5 million on bonuses, including on existing employees, for the remainder of the year.

Lots of Denny’s Corp.

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owners are offering hiring bonuses and free pancakes to applicants, and CEO John Miller said the company needs to do more to demonstrate that their jobs can provide flexibility for those less familiar with working in restoration.

“It’s a big challenge for us,” said Miller, whose company this month had recruiters travel across the country in a 53-foot food truck to sell Denny’s as a place to work then. that it seeks to hire 20,000 workers.

In addition to raising wages, Chipotle recently increased its mental health programs and started accepting resumes from workers through TikTok as it aims to hire thousands of people. “We’re doing things differently now,” said Marissa Andrada, chief personnel officer of Chipotle.

For workers like Zack Leiberick, 29, however, such efforts come too late.

Until the pandemic struck, Mr Leiberick had worked his entire adult life in restaurant kitchens, most recently as a line cook in a Denver dining room. But after losing his job last year, he got a job pruning potted plants at a local cannabis distributor, working 7 a.m. to 3 p.m. The new schedule, he says, is a positive change from his previous lifestyle, where he cooked until midnight and socialized with co-workers until late in the morning.

The new job offers a similar salary but additional benefits, such as paid time off, Leiberick said, adding that he hopes to build a career in his new field. “It brought a necessary zen to my life,” he says. “Cooking can be very hectic and overwhelming. It was a good change of pace.

Write to Heather Haddon at [email protected], Te-Ping Chen at [email protected] and Lauren Weber at [email protected]