While hiring slowed within the larger leisure and hospitality category in the past month, restaurants and bars were an outlier. In that area, operators can't find staff fast enough.
— Erika Adams
In November, the U.S. added 155,000 jobs and the national unemployment rate remained steady at 3.7 percent, according to the Bureau of Labor Statistics’ monthly jobs report.
The news confirms what restaurant operators have been saying all year: there’s a war for talent underway, and it’s increasingly difficult for employers in the industry to manage labor costs while also ensuring that they are retaining skilled staff. Shake Shack CEO Randy Garutti noted on the company’s most recent earnings call that labor was probably always going to be the company’s greatest challenge, and the battle to find staff is one that Shake Shack can’t afford to lose.
In the leisure services and hospitality category, which includes hotels, restaurants, and bars alongside performing arts, sports, gambling, and recreation, hiring has slowed significantly. A net of 15,000 jobs were added in November, compared to 56,000 added in the previous month.
Food services and drinking places, however, didn’t follow that trend. The sector added 21,200 jobs in November, accounting for the most added jobs in the larger leisure services and hospitality category. Hotels and other accommodations lost 7,200 jobs, performing arts and spectator sports lost 4,500 jobs, and the amusements, gambling, and recreation sector added 3,900 jobs.
[This story has been updated to reflect data from the Bureau of Labor Statistics’ job openings and labor turnover summary, which was released on December 10.]
According to the Bureau of Labor Statistics’ job openings and labor turnover summary, which more specifically looks at job openings, hirings, and layoff data by industry, accommodations and food services recorded 968,000 job openings in October, up 26 percent from the same period last year. There were 927,000 total hires in the sector in October.
The rate of people quitting jobs in the industry dipped slightly to 4.9 percent, or 692,000 people. (The quit rate in leisure and hospitality was the highest of any industry that the Bureau covers, followed by retail at 3.3 percent.) 198,000 people were laid off in accommodations and food services in October, down from 206,000 in the previous month.
On average, people in the leisure and hospitality category were employed for 26 hours per week, and the current average hourly wages were $16.19 per hour, up from $16.14 an hour the previous month. Average weekly earnings were $420.94.
Even though average hourly wages in the industry sit above — and in some cases, far above — the federal minimum wage of $7.25, it hasn’t offset operators’ problems with filling open positions. Rebecca Masson, chef and owner of Fluff Bake Bar in Houston, Texas, observed that the past four to five months have been particularly difficult for finding and retaining staff. “You could pay someone $16 an hour and they will still leave you,” Masson said in an interview in late October.
The total leisure and hospitality unemployment rate for the month remained slightly higher than the national average at 5.3 percent, or 729,000 people unemployed.
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