- Independent restaurants are struggling to operate because they can’t find enough staff.
- Owners are slashing opening hours, raising prices, and returning to the kitchens themselves.
- One said he closed his restaurant after larger companies poached staff with offers of higher wages.
Independent restaurants are being crushed by the labor shortage.
Their desperate owners are returning to the kitchens themselves and say they’re working longer hours than ever.
They’re raising menu prices, cutting opening hours, and offering higher wages and more benefits in a bid to stay open – but for some, the labor shortage has become too much, and they’ve had to close.
In a recent poll by Alignable of small and medium-sized business owners, 85% of restaurant owners said it was “very difficult” to find staff. Only 3% said they weren’t struggling to hire.
Staff have been leaving the industry in search of better wages, benefits, and working conditions.
While restaurant chains like McDonald’s, Starbucks, and Chipotle have been able to hike wages – in many cases to $US15 ($AU20) an hour and more – and offer hiring bonuses and education benefits to attract more staff, independent restaurants say this is much harder for them to afford.
Insider spoke to many restaurants across the US who said that they’d raised wages, but that staff still earned less than $US15 ($AU20) an hour, minus tips.
In a poll ran by Alignable between September and October, 61% of independent restaurant owners said that they expected large companies to make their hiring process harder in the fourth quarter by offering higher wages they couldn’t compete with.
Alignable CEO Eric Grove said that only 15% of small restaurants told him they’d been able to provide extra benefits to their staff, such as hiring bonuses, college tuition reimbursement, healthcare, flexible work schedules, and paid time off.
“Most of the time, larger restaurants (or companies outside of the restaurant business entirely) are pulling candidates away from smaller restaurants with higher wages and several of those perks,” Grove told Insider in an email.
Joseph Devor, owner of Joey’s Chicken Shack in Pennsylvania, told Insider he’d raised wages from $US9 ($AU12) to between $US10 ($AU13) and $US12 ($AU16) an hour.
“I think [staff] deserve more,” he said. “It’s just difficult because we started with very little and we have our bills to pay.”
Joey’s Chicken Shack isn’t alone. Restaurants are facing mounting wages and ingredients costs, which are cutting into their profit margins. Half of the owners of small and medium-sized business restaurants said in an Alignable poll that they couldn’t pay their rent in full and on time in September.
To avoid soaring costs, some restaurants are closing earlier or shutting their dining rooms. Robin LaForge decided to shut his restaurant, Cheniere Shack in West Monroe, Louisiana, for two days a week and close it an hour earlier on the days it is open after staffing fell by roughly three-quarters. Mirna McCormack, who owns Korner Cafe in Lewisville, Texas, is closing it around six hours earlier most days.
Some restaurants are also charging customers more. Devor, for example, has put prices up every month since May because of growing labor and ingredients costs.
He said he wanted to raise prices even further, but was worried that it would deter customers. McCormack similarly said she thought her cafe’s retired clientele would be put off by price hikes.
Because of the labor shortage, restaurant owners have also been spending more time cooking or serving customers themselves.
McCormack said she had started working 12-hour shifts most days before ultimately slashing the cafe’s opening hours. LaForge, meanwhile, said he was now spending more time doing prep work in the kitchen and had to restructure his menu because he didn’t have as much time to think up specials. He added that his wife, who’s undergoing cancer treatment, was having to help out.
Some restaurants have ultimately crumbled under the pressures of the tight labor market.
Taco Crush in McKinney, Texas, closed down in September after being left with just three kitchen workers. Owner Paul Horton told Insider that larger companies had poached some of his staff with offers of much higher wages or benefits.
“Being a small, independent business, I can’t compete with wages on bigger companies, let alone offer them any kind of benefits,” he said.