3 Reasons Why Restaurant Workers are Quitting the Industry

There’s no question that there have been sweeping changes in the past couple of years regarding the overall labor landscape as well as the ways in which companies operate as a whole. From the explosion of work-from-home technology to heightened awareness of health & safety, every industry has undergone a transformation of some sort. This is especially true for the foodservice industry.

Business Insider reports that according to the Bureau of Labor Statistics, 892,000 workers in U.S. food service & accommodations quit their job in August 2021 alone. Here we’ll examine some of the reasons behind restaurant staffing shortages and why ex-employees are not looking back.

Wage Stagnation/Lack of Benefits

Just recently, Restaurant Business published the results of a study conducted by Joblist. It discovered that 25% of ex-restaurant employees have no plans to return to work in a restaurant.. The top reasons cited were low wages, lack of benefits, and a desire for a new career. 

Particularly when it comes to waitstaff, the wage aspect may not come as a surprise. In most U.S. restaurants, waitstaff are almost entirely dependent on tips; and with decreased foot traffic in restaurants, those tips aren’t rolling in as steadily as they did a few short years ago. 

In a recent survey of restaurant workers, 90% of respondents revealed that their employers didn’t provide health insurance coverage.  This combination of lacking health insurance and falling wages can leave restaurant employees feeling vulnerable and insecure.

Stressful Working Environment

NPR published an article in July that surveyed restaurant workers, finding that among the employees who resigned, more than 50% did not plan to return to the industry regardless of pay. The “customer is king” mentality has always been important in the foodservice industry, but worker tolerance for it has sharply declined. 

Working in a restaurant can be quite demanding, so when it becomes short-staffed, extra strain is put onto the remaining employees. In turn, they may work long/irregular hours, making it hard to prioritize the demands of their personal life. With added strain on staff, tensions can run high. 

Read, “7 Tips: How to Build Company Culture”

“Turnover Contagion”

When a handful of key workers resign due to stressful work conditions, it can trigger a domino effect called turnover contagion. Turnover contagion occurs when a number of people resign from their jobs just because other employees are also talking about leaving. When one or more employees decide they’ve had enough, it may inspire others to follow in their footsteps, leaving a restaurant desperately searching for help.

How to Retain Restaurant Employees and Attract New Talent

The problems outlined above are some significant reasons why restaurant workers are leaving the industry; and while they may sound like monumental challenges to overcome, it is not an impossible feat. 

Here are some ideas for retaining staff and even attracting new talent:

  • Increase wages: While this might be the most costly option in the short-term, it is by every metric the number one reason why restaurants are losing staff. One way to do this is by studying market research and in-house data to restructure your menu prices and rework your scheduling around peak hours. Some restaurants have even started adding an automatic service fee to every bill. Regardless of how you approach it, if you can find a way to increase wages, it’s a surefire way to retain your best talent. 
  • Improve your environment: An employee that feels respected is less likely to quit. This could mean hiring an HR Manager for employees to turn to when they have problems, offering basic benefits, or even shielding your waitstaff from ugly customer confrontations as often as possible. Additionally, try to avoid overworking staff and take steps to ensure they have a healthy work/life balance.
  • Create an appreciative culture: Nobody quits a job they’re happy with. Turnover contagion is often indicative of deeper issues surrounding company policies or culture that employees remain silent about. Try to foster an environment in which workers feel appreciated, from top to bottom. Host paid employee appreciation days, give bonuses for jobs well done, feed them one complimentary meal per shift, and try to keep a finger on the pulse of the overall climate. These are all fundamental ways to help employees feel empowered and that they are being treated fairly.

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As a mutual insurance company, we operate and exist for the benefit of our policyholders. For more than 100 years, Society has been helping businesses overcome the unexpected with comprehensive coverage packages and outstanding claims handling, underwriting and risk management.

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