Understanding the foodservice wage and benefit shift is key to successfully staffing your company
By Steve Anevski, CEO and co-founder of Upshift
For good reason, industry observers and foodservice professionals have spent months standing at attention for signs of an emerging recovery: resumed corporate events, larger group gatherings, the green light to get back to normal. Now, at this stage of recovery, all the signs are there. But the unexpected labor shortage means the hardest part is far from over. Without staff, you can’t service any sales.
The last two months saw a mass migration of workers out of their roles and away from their industries. In July of this year, the number of job openings in the foodservice and accommodation sector peaked at an incredible 1.67 million. In August, another 892,000 workers quit.
Conjecture abounds regarding the Great Resignation phenomena—the motivation of the workers, the permanence of the movement and exactly how much these kinds of dire staffing shortages are going to cost. Reasons, perspectives and general predictions change from worker to worker, from expert to observational expert; the best answer available might be the simple admission that nobody knows. But, studying the trends that are solidifying in the real-time data—rates that have been motivating, changes in benefit offerings that seem to have success in bringing workers back—owners and employers can start to see a clear path of action.
The Delta of Pre- and Post-Pandemic Motivation
For employers struggling to staff hourly positions based on changing needs, offering a competitive rate is crucial. Most employers have navigated their recovery with the plan to return to pre-pandemic wage averages for the simple reason that the nature of the work they’re offering hasn’t changed. But for workers, a wage is a relative rate. Wage shifts across other industries influence people’s sentiments around compensation and role expectations. And across almost all industries, wages have shifted.
To fill their applicant pool, employers need transparent insight into the competitive rates in their space. Beyond their aims to counter the labor shortage, most employers want to pay fairly and support their teams appropriately, but a lack of transparency can prevent them from adjusting their rates. In September 2019, the average hourly wage for a worker in the foodservice and catering space was $13.87. While wage expectations fluctuate from city to city, $13.87 was the industry average across major American metropolises. This September, that number was up to $18.30.
Expectations are quickly changing regarding benefits, too. The pandemic era has brought new anxieties, needs and ideas to mind. For flexible jobs, workers who can work as W2 employees are afforded important protections and benefits—overtime, family and medical leave, health and dental insurance. In addition, freedom and flexibility are now highest on an employee’s list. The ability to take “unpaid vacation”—to have the ability not to work without ramification—is an important value-add for post-COVID workers.
An Employer’s Next Steps
Months of diminished sales and bottlenecked supply haven’t left employers with much room to stretch their role offerings. But it’s important that employers consider their resource spend across the entire hiring operation. Naturally, the costs of turnovers and unfilled roles far exceed the expense of increasing the wage baseline. Without a working team, employers have no hope of a full return.
Leveraging the proliferation of digital networking and app-based hiring platforms, employers can find more efficient role fulfillment strategies that diminish the time and resources they spend on elongated (and unsuccessful) hiring campaigns.
Further, the right kind of wage and benefit offerings can lead to real results. The big-picture value-add of working with reliable people is hard to overstate. The average no-show rate in the hospitality industry is estimated to be up to 25%—for every four workers recruitment teams have worked to secure, one of them is likely not to show up at all. By partnering with hiring platforms who are able to vet their candidates beforehand, employers can avoid the steep cost that comes with both the time lost in recruitment and the operations gap left behind.
Finally, integrated platforms can help employers have that transparency into competitive job offerings within the space. Tapping into the virtual communities that are supporting workers and employers through this time, employers can take an active part in their industry conversation. Many integrated app platforms will streamline all parts of the hire, from security checks to weekly payments and long-term working contracts. With more efficiency in the realms of recruitment, hiring and management—and with fewer costs associated with agency fees, no-shows and turnovers—employers might find they get what they pay for, and more, in the next phase of their recovery.
ABOUT THE AUTHOR
Steve Anevski is the CEO and co-founder of Upshift (upshift.work), an industry-leading staffing platform that connects businesses with pre-vetted W2 employees. Backed by Recruit Holdings Inc., the owner of Indeed.com and Glassdoor.com, Upshift has a success rate over double the industry standard (over 90%).
