Restaurants offer silver lining to todays economy
Last week's Jobs Report, issued by the U.S. Bureau of Labor Statistics, echoed news we've all grown accustomed to hearing — U.S. job growth is weak.
But is that the whole story?
If you take a moment to study the recent news, there is a silver lining — at least for the restaurant industry. In the month of August, 96,000 jobs were added on a net basis across the nation and more than 28,000 of those jobs were in the restaurant industry. In other words, more than a quarter of the new jobs — 29.2 percent — are in foodservice.
The job growth in the restaurant industry is so significant that I reached out to Hudson Riehle, senior vice president of the Research & Knowledge Group for the National Restaurant Association (NRA), to talk about it. He shared some interesting and promising insights regarding the growth of the industry.
Did you know that today, one out of 10 people in the U.S. works in the restaurant industry? That makes the foodservice industry the second largest private employer with nearly 13 million individuals employed by restaurants.
This surprising growth in a struggling economy is keeping with a trend. "This is the third consecutive year of solid growth rates for the foodservice industry," Hudson said. "In fact, the industry has added nearly 630,000 positions since the recession."
The reason behind this continued growth is simple — Americans like to eat out. Even though cash flow remains restrained, foodservice sales continue to increase. In turn, restaurants added jobs at a 2.9 percent rate on a year-to-date basis through August, which is more than double the 1.4 percent increase in total U.S. employment during the same period.
A recent NRA survey on what drives foodservice operators found that 28 percent rank the economy as their top challenge, and an additional 20 percent say food costs are their top challenge. Since one-third of sales in a typical restaurant go toward labor expenses and another third go to food purchases, operators need to continue focusing on managing their costs.
In fact, wholesale prices increased 8 percent last year, the largest increase in nearly 30 years. Menu costs rose by 2 percent. As the cost of food prices continues to escalate, it puts pressure on foodservice operators to focus on managing their labor costs more efficiently.
Hudson continued, "One of the greatest tools operators have to help them drive down their costs is technology. It can help them increase productivity and efficiency through the life cycle of an employee, from hiring to scheduling to learning and performance management."
The call to action is clear: Remain competitive and keep your overhead costs low by embracing technology. Connect with applicants, employees and customers using today's digital options. The more you integrate systems, engage your team and deliver great customer service, the more you will strengthen your brand and your bottom line.
Nate DaPore / Nate DaPore, PeopleMatter President and Chief Executive Officer As the spirited leader of PeopleMatter, Nate is passionate about providing team members, including his own, with a rewarding workplace experience that values creativity and innovation.