With 2021 nearly wrapped up, restaurant operators across the country are looking to the New Year with cautious optimism. On one hand, the industry disruption over the past 18 months has provided many new opportunities to look at ways to optimize business operations. However, the uncertainty and desperate regulatory environments at the state and national level present seemingly relentless headwinds.
Numerous shifts in both consumer behavior and the labor market have already left a lasting impact on restaurateurs. The GDP recovered to its pre-COVID level this past July, but with this growth arrived a more unsettled labor market, intensified competition for talent, spiked inflation and exacerbated ongoing supply chain pressures. This is the frothy backdrop against which restaurant HR professionals are working to recruit, cultivate and retain the right talent.
As operators prepare for the months ahead, four trends, in particular, are likely to emerge in 2022. The first is hiring and personnel practices, with a greater emphasis on internally hiring and upskilling. The second trend is the increased impact of technology in both employee and patron experiences. The third is changes to physical space, in which restaurant operators will need to quickly adapt to new health and safety needs. The fourth, and perhaps most impactful, trend is a transformation of employee benefits, with a greater emphasis placed on the overall employee experience rather than an additional element of compensation.
Hiring and personnel practices are likely to evolve in two ways. First, hiring internally will be one way to counteract a disrupted labor market in the short-term. Operators will need to focus on upskilling transferable skills among existing employees, enabling the transfer of talent to critical shortage areas. With upskilling comes the added benefit of bolstered confidence, a greater sense of belonging, and deeper interpersonal trust in managers. Additionally, skills sometimes considered secondary to restaurant roles are much more likely to be valuable in post-COVID recruiting. Recruiters will need to include problem solving, innate leadership capabilities, and even sales competency and tech savviness into their search criteria.
For those operators who aim to successfully scale going forward, choosing the areas of the business to outsource or automate are critical. Data and technology management should become a core component of efficient restaurant operations. Software can ease the burden of workforce management, scheduling, time and attendance, recruiting, and other critical components of managing restaurants. For cost and time reasons, it is essential to consider which staff-oriented tech services can be outsourced to external providers, which have the resources to fully manage these tools for the organization. Particularly for HR operations, removing administrative burdens and enabling HR professionals in your organization to focus on culture, training, and hiring will significantly increase the odds of success.
Additionally, operators should expect many of the changes to physical restaurant premises brought on by the COVID pandemic to become permanent, and consider what impact this will have on the employment experience. Complex physical distancing protocols may become less ubiquitous over time. However, more stringent hygiene and cleaning procedures, hand sanitizers for patrons, plus tighter health inspection requirements, are all much more likely. Conversations about COVID-19 vaccine and mask mandates will also need to be on the table. From a safety and food hygiene perspective, the restaurant industry will be held to a much higher standard moving forward. However, creating buy-in of new day-to-day health and safety procedures among employees could present a greater challenge.
Finally, benefits are less likely to be presented as bolted on packages, and more as an inseparable component of the employee experience. All operators, large and small, will need to leverage their unique culture as a differentiator. No longer will it be sufficient to simply offer benefits like paid leave, childcare assistance, and health, dental and vision insurance. To set themselves apart, operators must demonstrate to current and prospective employees how the culture of the organization will translate to a fulfilling experience. In short, “Why should anyone want to work for us?” needs to be the first question asked and answered by operators in the pursuit of talent in such a competitive labor market.
Forecasts from Datassential predict that restaurant spending will surge to nearly $800 billion next year. The sector will prove lucrative for those operators who position themselves to thrive amid the ever-changing operational environment. For leaders in the restaurant and hospitality industry, now is the time to adapt. Those that wish to survive in the war on talent will be able to answer, “Why should anyone want to work for us?” However, those that want to win the war, will understand that the answer to that question is constantly evolving.
This column originally appeared in Modern Restaurant Magazine and was written by Tye Reedy, the Director of Business Development for Adams Keegan.