Foodservice Industry Faces Labor Shortage, Wage Increases Trend

The foodservice industry is undergoing tremendous changes, with a labor shortage that is putting more pressure on employers.

According to a recent BLS report, August 2018 saw a 20 percent increase in open jobs throughout the foodservice industry when compared to the same month last year. Meanwhile, nondurable manufacturing also increased by nearly 9 percent from 2017 to 2018 and retail openings grew by more than 100,000 jobs during the same period.

Companies Navigate Labor Challenges

The number of job openings in the United States reached a high in August, with 7.1 million available jobs in the marketplace. Foodservice businesses across the country are having difficulty retaining existing workers as well. National chains like Panera Bread are concerned that the reduced workforce will lead to lower customer satisfaction and slower operations. To deal with the shortage, foodservice businesses like Dunkin’ Donuts are starting to implement more automation and robotic solutions. 

Besides the hospitality and foodservice industry, other food-related sectors are experiencing labor shortages as well. Cargill, the largest privately held company in America, has around 1,000 unfilled jobs (mostly in meatpacking) that are slowing the company’s overall output. Simultaneously, global demand for meat continues to increase, so Cargill and other agricultural businesses have begun adding worker benefits. They have also invested in robotics and automated technology to pick up some of the slack.

Additionally, Tyson Foods has begun working with local schools to train the next generation of foodservice employees in order to strengthen their pool of qualified candidates. They have also raised minimum wages and encouraged current employees to earn their citizenship and high school diplomas.

Many employees tend to be concerned that jobs will be outsourced to a robotic workforce. In truth, the foodservice industry will always have a need for humans who can provide a pleasant customer experience. To encourage employees to stay loyal, Starbucks has offered higher hourly wages and more benefits, like subsidized child care days. Meanwhile, Amazon and Whole Foods Market recently boosted its company-wide minimum wage to $15 an hour for part-time and full-time employees. This also applies to seasonal and temporary workers.

With many openings on the job market, employees have more choice and flexibility than in the past. For employers, the rising labor shortage will continue to present challenges that will require employers to innovate business practices that streamline efficiency and strengthen employee retention.

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