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In this ongoing in-depth investigation, NRN looks at how the current political environment could affect immigration and what it means for restaurant operators.
Today’s debate over immigration is being waged against a backdrop of intense employment pressure in the restaurant industry.
“This is an extraordinarily difficult time to get staffed and stay staffed, both in the hourly and the management ranks,” said Bob Rycroft, managing director at TDn2K, the Dallas-based industry analytics firm, which publishes Black Box Intelligence and People Report.
“Unemployment is at a very low point, and most everybody who wants a job has got a job,” he said. “And wages are creeping up, which ought to portend better results for the restaurant industry than it has.”
Total nonfarm payroll employment increased by 235,000 jobs in February, according to monthly unemployment figures. The unemployment rate fell one-tenth of a percent, to 4.7 percent, the U.S. Bureau of Labor Statistics reported in March.
Victor Fernandez, TDn2K’s executive director of insights and knowledge, said the People Report Workforce Index found that recruiting qualified candidates at both the hourly and management levels continues to be a substantial hurdle for operators, with little relief on the horizon.
“Both hourly and management turnover continue to rise, and are at 10-year highs across the industry’s segments,” Fernandez said. “Median hiring rates are above 100 percent for all restaurant industry segments. This means that for every employment position in their restaurants, most companies on average have hired one or more people to fill it at some point during the last 12 months.”
The National Restaurant Association reported in February that 14.4 million people are employed in foodservice. The industry adds about 170,000 workers a year.
“The good old days are gone, in terms of abundant labor,” said Wally Doolin, TDn2K founder and chairman, at the Best Practices conference in January.
The restaurant industry has the youngest workforce of any sector in the economy, according to the NRA, “and the steady decline in labor force participation among 16-to-24-year-olds presented additional challenges in recent years.”
According to the Bureau of Labor Statistics, the number of 16-to-24-year-olds in the U.S. labor force will decline by 2.8 million people between 2014 and 2024.
“The shrinking availability of individuals in that age cohort will have serious implications for the restaurant industry, as 16-to-24-year-olds currently represent about four in 10 restaurant workers,” the NRA said in February.
Contact Ron Ruggless at Ronald.Ruggless@Penton.com
Follow him on Twitter: @RonRuggless
In this in-depth special report, Immigration Impact, the Nation’s Restaurant News editorial team shines a light on the role of foreign-born workers in the foodservice industry.
Whether it’s people working in kitchens, running sophisticated franchise companies or picking the vegetables you serve your customers, it’s not a secret that the industry relies on foreign-born workers. Yet the extent to which immigrants are part of the fabric of the food economy is surprising — even to us.
• Foreign-born professionals run 29 percent of all restaurants and hotels, according to U.S. census data.
• More than 23 percent of people working in restaurants are foreign born, the National Restaurant Association found.
• Between 50 and 70 percent of the farm labor workforce is likely undocumented, according to a 2014 American Farm Bureau study.
In this report, we explore how foreign-born employees — both legal and undocumented — influence the restaurant workforce, the U.S. food supply, the consumer and the economy.
And we outline how restaurants can prepare for a possible increase in worksite raids.
The new administration’s stricter stance on immigration policy occurs at a time when restaurants are struggling to fill jobs. At the Last Vegas COEX conference in March, Louis Basile, president of Scottsdale, Ariz.-based Wildflower Bread Company, said tough local immigration laws enacted in 2007 caused the Arizona workforce to “dry up.”
“Great people want opportunities to progress in an organization, and without a workforce to fill the slots that we have, we end up basically spending most of our time really trying to find, train and retain help instead of building the business and building the skills that are so necessary to advance your career in life.”
On the same panel, Wolfgang Puck Worldwide’s president Joe Essa said the issue of immigration policy “comes back to fairness.”
“I think we have to protect our workforce and our nation, but we also have to be fair about offering the opportunities that support all of us. [At] our company, for example, Wolfgang came from Austria 38 years ago. I’m a short Lebanese guy in our group. That’s what we’re made of,” he said.
As seen in the recent election, the topic of immigration is a polarizing one — and one where tensions run high. In this report, we aim to provide a balanced view of how proposed changes to immigration policies might impact restaurants’ workforce and bottom line.
Jenna Telesca, Editor-in-Chief