As restaurants struggle to fill 1.2M slots, 706K workers walk off the job in a single month

restaurant
Photo credit Imagn Content Services

The far-reaching effects of the coronavirus pandemic are causing yet another shortage in the United States. This time, it involves restaurant employees.

Data shows that approximately five percent of the restaurant industry's workforce walked away from their jobs each month this year, according to the U.S Bureau of Labor Statistics.

It reached a record level in May, when 706,000 employees called it quits. The mass exodus has resulted in 1.2 million open positions at restaurants across the nation -- just as more Americans are starting to dine out again.

Why are restaurant workers walking off the job? The most common reason is low pay. Other factors include a lack of benefits, unreliable hours and rude customers -- something that appears to increasing as impatient diners emerge from pandemic shutdowns.

Workers say being in such a high-stress environment isn't worth what they're paid. The average hourly pay at restaurants and bars topped $15 in May for the first time, according to the Labor Department.

Many restaurants are boosting entry-level pay and even offering attractive signing bonuses to get new staff on board. But workers aren't taking the bait.

Some are calling staffing shortages the "new pandemic." The employee deficit is forcing restaurant owners to adjust hours in order to accommodate their skeleton crews. It also means busier schedules for employees who stay, which could lead to burnout.

Restaurant owners are not alone in claiming a worker shortage. American Airlines spokesperson Shannon Gilson said in June the airline was struggling with staffing due to the massive increase in demand for travel. But, according to economists, claims of labor shortages appear overblown.

Instead, experts say calling staffing issues a labor shortage is a myopic view.

Joe Song, senior US economist at Bank of America Corp., told Bloomberg the United States is experiencing a ”job paradox.”

Hiring is up, but in certain industries there is a gap in hiring demands and interested workers. Song said this is especially true of the hospitality and leisure industries.

“When we are hearing stories of businesses having to raise wages in order to attract workers back, that’s a good thing,” said White House economic adviser Bharat Ramamurti in a Bloomberg TV interview.

Mike Whatley, with the National Restaurant Association, said it's "the perfect storm." In an interview with Farm Journal, Whatley said not having enough staff to meet pent-up customer demand means the restaurant industry is in for a long haul when it comes to recovery to pre-pandemic levels.

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