As 2012 draws to a close and we begin looking toward 2013, there's one theme already bubbling to the surface: limited-service restaurants (LSR) will be evaluating their workforce structures next year.
Every healthy business looks at their staffing approach from time to time, but with a myriad of outside forces at play in 2013, restaurant owners and operators are focused, perhaps more now than ever, on the workforce composition — i.e., part time vs. full time — that will deliver the best results for their business.
So what forces are triggering this evaluation trend and how can you determine what approach will work best for your restaurant?
There are numerous factors at play causing businesses to revisit their workforce structure, but three key elements are influencing LSRs, in particular.
- Modest growth – The National Restaurant Association (NRA) has predicted that the quick-service restaurant industry will see 4.9 percent growth in 2013. Growth is good, but traditionally, more staff will be needed to accommodate growth. As LSRs look to increase their staff levels, will new hires be full time or part time? Does it make sense to move current part-time employees to full-time status before hiring new employees?
- Regulation changes – The Patient Protection and Affordable Care Act (also known as "Obamacare") has been the center of many business owners' attention for some time now. While the act's particulars are still being worked out, some provisions have spurred employers to begin contemplating the size and structure of their workforce.
- Hard cost increases – Several states will increase their minimum wages in 2013 – Arizona, Florida, Montana, Ohio, Oregon, to name a few – adding to employer labor costs. In addition, the NRA expects wholesale food price inflation to sit at 4.2 percent in 2013. These hard cost increases will put more pressure on LSRs' bottom lines and make it all the more important that employers are staffed appropriately.
Taken together, these outside factors are creating the pressure that's driving LSR owners and operators to look at their workforce structure and ask themselves if changes are needed to better support growth next year.
Weigh your workforce options
There's no magic formula to determine the right workforce structure for a business. The approach that best serves your restaurant is influenced by hard costs, organizational structure, consumer demand, legal requirements, etc. But before you dig into any of those factors, you need a solid understanding of the pros and cons of the two primary workforce approaches: part-time vs full-time.
- Part-time pros: Workforces made up of largely part-time hourly employees provide for reduced compensation and benefit costs; are attractive to desirable workforce demographic segments, such as students; and allow for greater schedule flexibility, which lets employers adjust staff levels to meet consumer demand.
- Part-time cons: However, part-time workforces may see less employee loyalty – including higher turnover – and inconsistent employee productivity. In addition, with higher turnover, and a larger workforce, you could see elevated training costs.
- Full-time pros: Workforces comprising mostly full-time hourly employees have the potential for higher productivity and service consistency due to high retention, strong employee loyalty, more solid team unity and a great ability to promote from within.
- Full-time cons: On the flip side, full-time workforces tend to carry higher compensation and benefit costs. And because you're depending on a smaller workforce to carry a larger workload, it's critical that you're committed to building your workforce strategically, even if it may take a little longer to find the best employees.
Regardless of the approach you take, having the right employees in the right positions is critical because a strong team can yield benefits — reduced turnover, increased sales, improved customer service, etc. — which can often surmount other factors impacting your bottom line. And when it comes to having the right employees in the right positions, it all boils down to recruiting directly from your target audience and focusing more on applicant aptitude over experience. You can find out more about how to recognize the best here.
There's little doubt that LSR owners and operators will be evaluating their workforce structures next year. What remains to be seen is whether or not employers will take a balanced look at their options, weigh them against outside forces and put an emphasis on finding right-fit employees. If so, LSRs will build a structure that supports growth and they'll be in a strong position to capitalize on what 2013 will offer.
As VP of marketing, Jason Hamilton makes sure hourly employers are aware of Snagajob's solutions that make it easier for hourly employers to recruit, hire and retain a stronger workforce. He also keeps tabs on the hourly marketplace, analyzing trends and staying one step ahead. Oh, and he had a cameo in a Bollywood film.