DISCLAIMER: This content is provided for informational purposes only and is not intended as legal, accounting, tax, HR, or other professional advice. You are responsible for your own compliance with laws and regulations. You should contact your attorney or other relevant advisor for advice specific to your circumstances.
New hospitality, technology, and economic factors are changing the landscape for the restaurant people of today. Innovations in robotics and software are streamlining labor and simplifying staff management, but the age-old struggle for workforce equality continues as our nation’s middle class has been shrinking.
How can restaurant owners make restaurant work an enticing option for job seekers and create a safe, supportive workplace environment for their restaurant staff, all while striving for success in a hyper-competitive industry? It’s a lot.
To understand how to attract and retain the restaurant people of today and tomorrow, let's first take a look back at the ones who got us to where we are now.
The History of Restaurant People
Part I: How immigrants became the backbone of the American restaurant industry.
Early in American history, our first restaurants existed in taverns, pubs, and guest houses.
Sometimes these establishments would pop up out of necessity in port cities like New Orleans, Boston, or Charleston, or 19th century frontier towns where migrant workers or bachelor prospectors congregated, needing a place to stay and food to eat. Guest house kitchens would serve limited menus — often whatever the woman of the house decided to cook that day — and were typically staffed by family members. Some of the first female business owners in the U.S. were the proprietors of pubs and guest house restaurants.
Fine dining restaurants arrived in the U.S. in the late 19th century as an imported trend from France. Aristocratic households that dissolved during the French Revolution brought fancy china, white tablecloths, and tuxedoed wait staff with them. These fine dining restaurants had people of many races and genders working in their kitchens, but the front-of-house staff and the restaurant’s guests were typically men, according to author and historian Jan Witaker. During this time period, unaccompanied women were unwelcome or relegated to separate dining rooms.
Delmonico’s, which opened in 1837 in New York City, is considered to be the first fine dining restaurant in the country and set the mold for the modern American restaurant.
Lunch counters in the late 19th and early 20th centuries began to employ more women, and female dishwashers became common during wartime as women sought to fill vacant jobs while men were deployed.
The early 20th century also saw the birth of one of America's first multi-cultural food trends, as “Chop Suey Palaces” introduced Chinese-American cuisine to the market.
The reason for this particular trend, however, was not our nation’s adventurous appetites: It was rooted in stringent U.S. immigration laws that sought to discourage Chinese immigration after the railroad boom had subsided and, with it, the need for cheap, foreign labor. A loophole in immigration policy at the time allowed for particular businesses — including “high grade” restaurants — to obtain “merchant status,” enabling them to enter the United States and sponsor their relatives for immigration. The Chinese restaurant became a common pathway for legal U.S. immigration, but the journey was fraught with exploitation. As this report from Scholars.org explains,
“For the sake of family, Chinese restaurant employees were expected to work for low wages and perform physically demanding labor without complaint. Consequently, the average employee in such restaurants earned 1/3 less wages than the national average for food service employees.”
On top of that, many were sending a portion of their wages back home to family in China, leaving those working within American restaurant kitchens with little to support themselves.
Mexican cuisine was introduced to the American stage at a similar time, mainly as a result of the Mexican Revolution, starting in 1910. Mexican refugees opened up our country’s first tortillerias and taquerias selling tacos, enchiladas, and other southern and central Mexico dishes that are now mainstays on today’s Mexican American menus.
In the early 20th century, approximately 3 million poverty-stricken Italian immigrants came to the United States and with them introduced a lasting impact on American restaurant culture, though at the time their businesses initially only served their own people, catering mainly to working class Italian enclaves. It wasn’t until Italian Americans became more integrated into mainstream society during World War II, as they joined the military and moved into the suburbs, that modern Italian American cuisine was established and widely embraced.
U.S. restaurants underwent a seismic shift in the mid-20th century as factory assembly line technology was introduced to food service and with it the concept of fast-food. Assembly line-style food prep made it possible to quickly train any worker to prepare a basic meal at lightning speed. The low skills required plus the demand for labor opened up employment opportunities for teenagers and workers of color who were previously excluded from most customer-facing food service positions. The economy of scale that came with assembly line food also led to the proliferation of restaurant franchises like McDonald’s and Denny’s that thrive across America, and the globe, to this day.
Part II: The complex socio-economic challenges facing today’s restaurant people.
In many ways, the restaurant people of today haven’t changed much since the mid-20th century. Ours remains one of the most diverse industries — you’ll find people of every color, origin, and gender working in a restaurant and across food service in general. Immigrants still make up a large proportion of our food service workers, especially in our big cities: In New York City, roughly 70% of cooks and food prep workers were born in another country, per a report from The New Food Economy.
And yet, even with its diverse makeup, the industry is still segregated and unequal. In a 2015 interview with the New York Times, famed restaurateur Danny Meyer said,
“The gap between what the kitchen and dining room workers make has grown by leaps and bounds.” He said that during his 30 years in the business, “kitchen income has gone up no more than 25%. Meanwhile, dining room pay has gone up 200%.”
To help address the gap, Meyer decided to pioneer a practice of eliminating tipping at his restaurants, raising the hourly pay of his workers across the board and baking the cost into the price of his menu items.
These kinds of moves to address the wage gap between front-of-house and back-of-house workers are important, especially when white employees still predominantly fill the roles with the higher wages and salaries, while people of color and other underrepresented or marginalized groups largely work in lower paying positions. That includes the 22% of food service jobs in the United States that are held by immigrants, almost half of which are not authorized to work in this country, according to the Pew Research Center. The income divide is gender based, too, reports NPR:
“White men across the restaurant industry are paid, on average in the U.S., roughly a quarter more than women, whether white or of color.”
As we’ve seen factory production jobs leave the U.S. during the past half-century, there are fewer job opportunities for workers without a college degree or formal job training. American fast food assembly lines remain some of the last obtainable low-skilled gigs for adults struggling to make ends meet, and with minimum wage pay that hasn’t kept up with the cost of living, it’s not the golden opportunity it once was when the McDonald’s craze was first sweeping the nation.
This is why we’ve seen massive protests — and several victories — in recent years from hospitality workers demanding a $15 minimum wage, better standards for setting work schedules, and no arbitrary firing of employees. The Ford Foundation reports that the American restaurant industry has the highest proportion of workers earning wages at or below the federal minimum. Most of the nearly six million tipped restaurant people are women of color who work in casual dining establishments and make a median wage of just $8.75 an hour — including tips.
Restaurant owners and operators are figuring out how to adapt to staff needs while still remaining profitable: A new study by Harri revealed that a whopping 71% of restaurants have responded to the recent minimum wage increases by raising menu prices. This means a lot of the costs of these wage changes are being passed on to diners.
For many people, working in a restaurant offers an opportunity to earn wages that supplement other income streams or creative pursuits, but today’s restaurant industry can still offer good, full-time employment. Many restaurant staff members are adjusting their lives to meet the demands of the job, and on the flip side, many restaurant owners and operators are implementing new staff management tools and strategies to adapt restaurant work to staff expectations of the role work should play in our lives.
But the industry is still less accommodating to people with families to raise, particularly single moms and dads. This has always been the nature of the job — unless, of course, it’s your family’s business and the whole household is involved.
Tobias Rower, a former employee of several fine dining establishments in New York City, including Danny Meyer’s Gramercy Tavern, made a good living in restaurants for a while, but, he says,
“I got to a point where I realized I didn't want to own my own spot nor manage someone else's. Pretty much every meaningful promotion within restaurants means more responsibility and more hours for less pay. If you want to run the show and go on to have your own place, that experience is important and necessary, but it's also insane and illogical.”
Rower left serving and bartending to work in wine wholesale, a job with more “normal” hours that lets him spend more time with his wife and child.
“I do miss the camaraderie of working dinner service. It's fun working a job where you don't need your phone, you don't need to write or read emails, and you can work together to accomplish something tangible,” he admits. “But as I got older (also, having a partner who didn't work the same hours was tough), I knew I had to make a change.”
Rower’s experience is all too familiar for staff in today’s restaurant workforce. This desire for a less stressful, more stable, higher paying career in the restaurant space, coupled with a strong economy and a tight labor market, has led to a crisis in staff retention and turnover.
The average tenure of a restaurant employee is one month and 26 days, with managers lasting an average of four months and four days. Everyone is talking about this problem, and the community is coming together to understand how to make the restaurant industry an attractive place for a long-term, rewarding, worthwhile career.
In this five-chapter interactive course, you’ll learn how to master the hiring cycle so you can get back to doing what you love.
Part III: Imagining what the future holds for restaurant people.
New technology is changing the relationships between the restaurant and its workers. Handheld POS devices, self-serve kiosks, an explosion of reservation-making services, even robot restaurants are automating or streamlining some of the more repetitive and less creative tasks involved in running a successful restaurant.
While it remains to be seen if 21st century technological innovation upends the restaurant industry the way it did with fast food in the last century, the early effects we’re seeing are that workers are being relied on for more creative and service-oriented tasks that require skills like empathy, salesmanship, and genuine hospitality. The upshot of that is we may find workers more invested in their work and employers hiring for more skilled labor at higher pay, afforded by the money saved from automation of other tasks. The inherent downside is fewer jobs for less-skilled workers.
In the backlash to the fast and over-processed food that fueled the growth of casual dining during the mid to late 1900’s, the farm-to-table restaurant movement continues to grow. Front-of-house staff are expected to be as familiar as the chef with the origins of ingredients, and the workers who farm, raise, and produce the raw ingredients are becoming more integrated with the workers who cook and serve them. In the future, this trend could find us with more restaurants that grow their own food on premises, in urban rooftop gardens and vertical farms that celebrate organic and local food while also feeding our exploding population by any means necessary.
However, if water pollution, soil depletion, and other side effects of agribusiness cause the practice to crumble under its own weight, locavorism could become a way of life for all future restaurants diners out of necessity. On the other hand, it might remain an elite, urban trend while rural America simply won’t be able to afford to eat out much if food production becomes more consolidated and small family farms fade out of existence.
Though food costs could eventually make dining out a luxury, increased labor costs could make jobs in restaurants hard to come by.
In recent months, we’ve witnessed the adoption and roll-out of the $15/hour minimum wage in seven states and The District of Columbia as well as the early indicators of how this increase to labor overhead would impact the restaurant industry on the whole. Though initial reports in New York City claimed restaurants were thriving despite the hikes in labor costs, more recently a poll of 324 full-service restaurants in NYC found that 77% of respondents cut hours for their restaurant staff, while another 36% percent laid off workers.
Though this move was intended to give restaurant people a living wage by decreasing reliance of tipped income, restaurant owners from coast to coast are still struggling to attract and hold onto employees. According to Toast’s 2019 Restaurant Success Report, 51% of restaurateurs cite recruiting, hiring, and retaining restaurant staff as their number one operational obstacle this year. As restaurant owners, operators, and managers test new staff management models, compensation structures, and employee benefits programs aimed at making working in the restaurant industry an enticing career opportunity, only time will tell if this new focus on increasing workplace satisfaction will pay off.
The shift to off-premise dining becoming the majority also stands to threaten positions in both front- and back-of-house. According to the Atlantic, it’s predicted that restaurant delivery — the online market powered by GrubHub, Uber Eats, Postmates, etc. — will grow 15 times faster than the rest of the restaurant business through the end of the decade. Coupled with rising rent costs pushing restaurants out of attractive, accessible brick and mortar locations, many restaurateurs are rethinking their focus on driving guests on-premise.
Though the restaurant industry is expected to surpass $863 billion in sales this year and restaurants will still be in demand for serving up meals, there will likely be a shift away from hiring wait staff to hiring more delivery staff and cooks on the line to handle the influx of off-premise orders.
The secret to hiring at Darwin’s Ltd.? Go with your gut, and hire for personality over skill. Co-founder Steven Darwin shares their story.
Part IV: How to make our industry attractive for the next generation.
Change can be exciting. It can also be scary. But all business owners must be prepared to adapt to new realities in their industries. That's especially true for restaurateurs whose businesses are in highly competitive markets where operational overhead is high and the margins are razor-thin.
The National Restaurant Association projects that restaurants will be responsible for adding approximately 1.6 million new jobs by 2027, but because the restaurant industry is currently growing at 2x the rate of the population while the United States is experiencing a historically low unemployment rate at 3.5%, restaurateurs will likely continue to struggle to find and hold onto the talent they need to deliver memorable dining experiences. For restaurant job seeker, it truly is a buyer’s market. Restaurant employee turnover has proven to be an industry wide problem, though its impact is especially acute in crowded urban markets where job seekers have their pick of the litter. By and large, today’s job seekers are pursuing opportunities where they:
- Feel appreciated
- Know management prioritizes their professional development
- Feel aligned with your mission and purpose
- Are compensated fairly
- See the value the job has on their personal and professional lives
Offer Benefits like Profit-Sharing
Andrei Stern of Miami-based SuViche has found hiring reliable staff can be challenging. “At the end of the day, they’re going to leave if they can make a few bucks elsewhere,” he told us. To combat that, SuViche has offered profit sharing for hourly employees. “We set certain metrics. If they [staff] can meet them, they get a bonus. It’s helped with morale, productivity, and turnover.”
He adds, “I think culture plays an important role. We need to make staff feel comfortable. We need to be on the same side. First, we need to learn how to listen — that’s something we always teach our managers.”
Then, what starts with the staff makes its way to the customer. “First, be hospitable to one another, then to our guests, then the rest will fall in line. The guest will come in and feel that energy.”
SuViche has also embraced new technology to help manage their staff of 400 team members across a half dozen locations. They simply could not have grown the business without it. “This year we’re working a lot on establishing a learning management software that creates consistent training across all stores,” he explains. This, along with digital tools for accessing pay, seeing their schedules, swapping shifts, etc., has made SuViche attractive to Millennials and Gen Z workers. “Your first interaction with a potential staff member needs to be very user-friendly, so we use a mobile-friendly option that allows you to apply online,” he says.
Provide Mentorship and Learning Opportunities
Sometimes, doing something bold that’s good for workers can set a business apart and attract attention and new opportunities. Emma’s Torch, a social enterprise in Brooklyn, NY, employs refugees, asylum seekers, and survivors of human trafficking in a 12-week, paid apprenticeship program that helps set them up for culinary careers. Their unique business model has earned them media praise from Food & Wine, NPR, and Bon Appetit among others and recently led to an expansion with a cafe inside the busy Brooklyn Public Library.
What SuViche has in common with Emma’s Torch is that workers are being empowered to manage their work life more seamlessly and empowered with career skills they can take with them. “The decision making power, instead of flowing up in the hierarchy, we push it down. Everyone has the ability to make decisions,” says Andrei.
Provide Earned Wage Access for Employees
When restaurant employees feel supported by their employer through great pay and benefits, they’re happier and can do their best work.
According to Market Watch, more than half of American consumers (56%) said they are living paycheck to paycheck and restaurant employees are no exception, many of whom have limited or no emergency savings.
The ability for your employees to access their wages when needed, before payday, is becoming more and more essential. Financial stress is a significant mental burden that can lead to burnout, absenteeism, and turnover, and earned wage access can help alleviate these issues.
Offering earned wage access can improve restaurant employee experience, increase financial stability and improve retention. According to a PwC employee financial wellness survey, one in four employees were distracted at work by personal finance issues in the past year and 54% said financial or money matters caused the most stress. By providing earned wage access, employees can reap the benefits of greater financial flexibility.
Robots, Drones, And Driver-less Delivery
The restaurant industry has been a hotbed of innovation and yet remains an industry that’s set in its ways.
As cultural, technological, and economic factors change the needs and demands of the restaurant workforce, we’ll see restaurateurs and their staff working together to shape the future. From robots powering back of house to drones facilitating delivery, the future of the restaurant industry will surprise and delight guests with the latest in culinary and tech innovation for decades to come.
Business owners who embrace what’s best for their workers will have the ultimate advantage.