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The program initially ran from late March through July 2020 with a $600 supplement, and was reauthorized at half that amount in late December. Why? Most likely because an enhanced federal unemployment program gives an extra $300 a week to those receiving jobless assistance. But the national employment rate remains relatively high, at 5.8% as of May. In normal times, such fierce competition for labor should drive down the unemployment rate, as people looking for work are enticed by higher wages and other perks. “Because the pandemic lasted for so long, now there’s a lag.” “Everyone decided at once to come back, so there’s a huge mismatch between supply and demand,” says Sridhar Tayur, professor of operations management at Carnegie Mellon University’s Tepper School of Business. As a result, those looking for a job have plenty of options. At the same time, hospitality employers are in fierce competition with one another to staff up in order to accommodate a tsunami of consumers who are determined to travel, be entertained and eat out. And others have become wary of going to work, out of health concerns, burnout, or frustration with the ever-changing regulations. Parents and other unpaid caretakers, particularly women, have dropped out of the workforce entirely. Some workers in the most blighted industries have shifted to industries that were growing last year, like home-delivery services, or have even started their own companies. So as states declare a return to normal, employers find themselves facing a labor pool that is anything but. But the current hiring crunch is very much rooted in the pandemic, stemming from economic shutdowns, industry-specific restrictions and major shifts in consumer spending patterns last year. In the U.S., the pandemic may seem to be ending. In a survey from the National Restaurant Association, which represents the spectrum of restaurants from white-tablecloths to fast food, 72% of operators rated recruitment and retention of workforce as their top challenge, up from 8% in January.īut while there may be industry-wide agreement over the extent of the problem, there’s less consensus about why the labor shortage is happening in the first place and what to do about it.

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In a late May earnings call, the CEO of Cracker Barrel noted that staffing was at concerning levels at one in four stores, and at critical levels at one in 10 stores. Large chains are feeling the crunch, too. Numerous independent restaurateurs and small franchise owners interviewed by TIME, from South Carolina to Hawaii, painted a similar picture. “We explain we don’t have enough people and they’re like, ‘well, you guys must be idiots and lousy at what you do.'” “They can’t understand why the service isn’t great, or they’ll say, ‘I can see you have open tables, so why aren’t you seating me?'” he says. But he lacks enough workers to serve all those customers, and diners are not as sympathetic to his business troubles as they were during shutdowns. Bureau of Labor statistics.ĭomitrovich says seating demand is back to where it was before the pandemic, and on some nights is even higher. In May, employment at eating and drinking establishments was still 1.5 million jobs below pre-pandemic levels, or down about 12%, according to the National Restaurant Association’s summary of data from the U.S. But it’s particularly pronounced at restaurants, which are short on chefs, washers and wait staff. From warehousing to trucking to hospitality, the shortage is rippling through the economy, causing supply-chain bottlenecks and driving up costs that are preventing many sectors from fully recovering. The labor crunch is widespread, affecting many industries that dimmed their lights during the pandemic and are now scrambling to turn them back on. I’m down 30%, and they are key positions.” “Overall I had about 150 employees before the pandemic.

“We’re not even close to being able to fully reopen,” he says.

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Instead, he’s struggling to find and retain enough employees to handle a full house. Pilot brooklyn bridge park.Domitrovich’s business challenges no longer stem from wary diners or capacity limits that sent sales volume into a tailspin last year.

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