THE DILEMMA OF HOSPITALITY TEAMS AND SALARIES IN 2021

THE DILEMMA OF HOSPITALITY TEAMS AND SALARIES IN 2021

When we compare satisfied employees with good pay the hospitality industry has been in a condition of instability and this began prior to 2020. While a solution has encompassed different directions but never resulted, the dilemma is being further plagued by an unexpected new competitor paying all our staff, and they are paying them a higher wage.

Rates of pay have been a hot topic for some time now, however, the burden upon businesses satisfying salary expectations has been further complicated in 2020 and now 2021. Front of House and Back of House staff have been talking better pay for years. With the current unemployment benefits going until September 2021, it will be difficult to get employees to return to work. The new unemployment benefits are offering the customary amounts plus an added three hundred dollars in supplemental pay. This means $500 to $800 a week salary for sitting home. Will we see staff return to a job that has many hours of stressful work, often difficult conditions, sometimes low morale and poor treatment, and less pay, or will this cause workers to stay home?

While I applaud the much-needed money for many families, how must we react to keep our businesses open and staffed?

Hospitality staff have been running to other jobs outside the industry for some time and even more so after COVID canceled their jobs. Many social posts by foodservice employees and especially chefs are all talking and telling each other about the difficult work environment with less available workers by their side. They are sharing discussions about better jobs and reasons to not return. The industry is a killer when it comes to hours worked for the often talked about unrealistic workload to pay received. Changes have been occurring to better the level of income; however, it may be a little late. While passionate staff will hopefully remain, it is more difficult to keep required staff levels, and turnover is only going to increase in the months ahead.

The options to bring staff back may be limited right now, and do not believe that this is going away any time soon. Staff is running to other industries than food services and they are taking their friends with them. If you do not settle upon a way to secure your team, and soon as summer is coming, you may be left holding up the business with limited staff. As the owner or manager, you will do a lot more than you expected or can accomplish.

We are in a serious position with staffing our restaurants, our private clubs, our café’s, and our catering businesses unless we can come up with solutions.

In addition, low levels of staff and high turnover associate with guest dissatisfaction. We all know the outcomes of poor service and lower quality food output. From losing customers to paying the price in online posts that kill business, now is the time to step up with a plan.
 
What can you do short term?

1)     Enlist good quality ad-hoc staff on the busy days and pay them well so that they will work the days offset from unemployment benefits. If they can pick up a Friday, Saturday, or Sunday at a good rate, and perhaps still receive a good portion of their unemployment benefits, this is a win for both.
2)     Reboot your menu with lower-cost items with less prep and cooking needs to reduce staff requirements. Pay the people you have a higher wage to keep them. While not for every category, this may suit smaller locations over the short term of 2021.
3)     You made it through the 2020 season and want to meet the demand of added revenue from the locations nearby that may have closed. Put this to the test and increase your rates of pay, add between 10-50 cents per menu item, concentrate on other cost reductions, and teach your team what items have the highest potential for profits. Keep in mind that the higher-cost items may yield the most profits. Sell profits.
4)     Purchase the restaurant next door that closed during COVID. Utilize this addition to maximize your staff needs and your preparation needs. IE: all prep is done at one location, the staff has more hours available and work security with two locations, transfer product between locations as necessary to improve utilization, use one location as a commissary kitchen (Ghost Kitchen), etc.
5)     Sell safety over food and service. Guests are more interested in how safe they will be over how good your food or service is. Tell guests what you are doing and Sell Safety to get them in the door.
Whatever you come up with, business as usual is not coming back anytime soon. You cannot wait until things settle down because too much has changed.

The way you did business in the past is gone for now. Step up and plan.

Jim Lopolito, President
Lopolito Hospitality Consultants, Corp. (LHC) is a New York based consulting firm that offers Recovery Facilitation, Startup Development, Feasibility Studies, and Forward-Thinking Solutions alongside Operational and Management Practices to businesses in the hospitality industry.