Q3 Workforce Index reveals sustained recruiting, turnover challenges in restaurants

Ron Ruggless | Oct 22, 2018  Nations Restaurant News

Recruiting remains a challenge for restaurants, and the third-quarter People Report Workforce Index registers how wide and deep the difficulty is.

“We’ve seen sustained levels for the past two or three years that we hadn’t seen in a decade or more,” said Michael Harms, vice president of operations at Dallas-based TDn2K, which produces the People Report Workforce Index quarterly.

“The percentage of companies reporting difficulty is high,” Harms said. “People are saying it’s almost impossible to staff a restaurant these days.”

The national unemployment rate fell to 3.7 percent in September, the lowest level since 1969, according to the Bureau of Labor Statistics. Meanwhile, the gross domestic product continued to rise from its 4.1 percent growth in the second quarter.

“The demand for workers sparked by this economic growth and low unemployment has resulted in a shortage of quality employees and record high turnover rates as workers are presented with more employment opportunities,” the third-quarter Workforce Index noted. “Barring a change to the macroeconomic environment, labor pressures are expected to remain high with increasing wage pressures posing an added complication.”

Harms said the People Report spent the past year revising the Workforce Index, which started in 2006 and measures expected market pressure on restaurant employment and is based on surveys of restaurant industry human resources departments and recruiters.

The Workforce Index now has a baseline value of 0 and ranges from -100 to +100. Values over 0 indicate increased levels of that component, and the strength of each value is measured by its distance from 0. An overall index value is calculated as a weighted average of the five components, including employment levels, recruiting difficulty, job vacancies, employment expectation and turnover.

For the third quarter ended Sept. 30, the overall Workforce Index registered a value of +26.9, indicating moderate increases in labor pressure.

Recruiting pressure seems to be highest in the quick-service segment, Harm said.

“They really are struggling to find staff,” Harms said. “It’s across the industry, but we really are seeing the struggle in QSR.”

At the hourly level, the turnover comparison remains significant across the segments, he said. It’s significant across most segments.

“Casual dining and upscale fine dining scored a little lower in the quarter,” Harm said. “Casual dining is in a tough spot. When it comes to competition, they are taking fire from upscale; they are taking fire from fast casual. They are surrounded by two of the industry darlings, and we’re seeing that in the demand for employees.”

Overall, Harms added, it remains difficult to find employees for all segments of the restaurant industry, a trend that has continued since post-recession labor pressures began about five years ago.

“Those challenges don’t seem to be going away any time soon,” he said. “This is the longest period of sustained labor pressures we have tracked.”

Back

What Clients Say About Patrice & Associates

  • Amy is genuine, honest and has a passion for what she does.

    Amy contacted me in a time where I was unhappy where I was but wasn’t doing anything to change it. She was very informative and if she didn’t have the information at hand, she got it. She revamped an old resume making it more about achievements than responsibilities. She coached me on interview tactics before multiple interviews and was there to talk about them afterwards. Every conversation we had felt more like a friendship than business. She is genuine, honest and has a passion for what she does. She also helped boost my confidence through the entire interview progress. Whatever she is doing, she must be doing it right because I got the job! Thanks Amy for a life changing experience.
    Sincerely,
    Shawn Ware
    Amy is genuine, honest and has a passion for what she does.
  • I really appreciate Tim for all his handwork and consistency.

    He saw a lot of potential in me which allowed me to apply for a higher position than I had first intended. Although the process wasn't easy he was still very honest and trustworthy. I am very grateful to have received his guidance. I really appreciate Tim for all his handwork and consistency.
  • I want to thank Tim...

    ...for all the time he spent helping me acquire my new career. He has helped by assisting me with redesigning my resume and keeping in contact with me throughout the entire process.  His actions showed that he really cared and wanted the best for me. Thanks again, Dominic Almanza I want to thank Tim
  • I would 100% recommend Ross

    I cannot begin to thank Ross and Karen enough! without the two of them I wouldn't have even known about the position! The interview process was quick, easy and simple. After only a short week I was in a position I knew I was going to love forever and it was all thanks to them! Ross has been so good about following up with me even after being hired, asking how my experience has been, what hours I'm working etc. and to top it all off Ross even sent me a gift card thanking me for working with him. I would 100% recommend Ross to anyone looking for a career in the industry!
    Cheers,
    Bayley Ferreira
    I would 100% recommend Ross
  • I had the pleasure of working with Doug Lockwood

    Doug was extremely professional and was very easy to work with. He was quick to respond, made himself available anytime I had a question, and was always checking in through the entire process. He coached me through the interview process by sending over necessary documents to read over on my own time, giving pointers on the phone, and talking through details. You can tell Doug cares for each person he works with. Even after getting the job, he is still checking in to see how things are going and making sure all is going well. I would recommend Doug to anyone when looking to start their career or looking for a career change. He was a great resource to have when needed.
    Thanks,
    Tony
    I had the pleasure of working with Doug Lockwood