Restaurant Troubles

With the advance of tech-enabled food delivery systems like Uber Eats and DoorDash, there seems to be an endless array of choices for dining-in. But there is something happening in the restaurant industry, impacting both smaller restaurants and larger chains: more and more workers are shying away from jobs in restaurants that were once easily filled.

We dive into the reasons, which can be segmented into three areas.

  1. Rising cost of labour The Province of Ontario raised its minimum wage to $14/hr in 2018. The minimum wage was only $11.60 in 2017. Such a drastic increase (over 20% in one year) has led to increased competition within the near-minimum wage group. All of a sudden, restaurants that were paying a good 1.5x over minimum wage (i.e. $17/hr) is now in the near-minimum wage sector. In this range they are competing for talent with much easier retail jobs. Who wants to sweat over a hot fire 8 hours a day if they can sit behind a counter and earn a similar wage?
  2. Hard work – being a cook or waiter/waitress is hard work. It requires years of training, certifications, expertise, customer-service skills, organization, and nose-to-the-grind hard work. It’s much harder to work in a restaurant, with much more pressure than in an office or a shop. Without adequate compensation, it’s no wonder most people don’t prefer it.
  3. Foodie culture – nowadays everyone is a self-claimed Foodie. Along with this title, more people are increasingly demanding about their food, especially when eating out. In any restaurant, the Taste, Service, Presentation, Atmosphere and Value are constantly being judged and rated on the likes of Yelp and Tripadvisor. This culture of indulgence increases the pressure on restaurateurs to provide the best dishes at a reasonable price. With the aforementioned minimum wage hikes, the restaurant is caught between a rock and a hard place, unable to pass on the majority of price increases for fear of losing clientele. The added volume from the likes of Uber Eats increases revenue, but also increases the stress on the already-pressured staff.

For small restaurants, this is especially evident as turnover increases and owners and managers find it more and more common to having to step in themselves to fill the gap. Dishwasher and line cooks are especially prone to turnover and no shows. These are tough jobs with limited room to grow, and often do not enjoy the benefit of tips. Something will have to change in the industry. Either wages will have to increase substantially (meaning higher costs for patrons), or restaurants will have to start to explore automation. Either way, the industry will have serious staffing gaps in the meantime.