Skip navigation

Industry employment indicators show upswing

Recent labor activity and employer expectations indicate the restaurant industry may have finally found the bottom of its recessionary slide, according to the People Report Workforce Index for the first quarter of 2010.

The Workforce Index is a quarterly barometer of market pressures on employment, such as recruiting, turnover, job vacancies and headcounts. Ratings lower than 50 indicate less difficulty in managing those personnel issues and scores higher than 50 indicate greater difficulty. More than 60 foodservice concepts participated in the study.

While the overall index reading hovered below 50 in the first quarter of 2010 — at 48.3 — it was still the highest result since the U.S. economy began a steep decline in October 2008.

“Over the past several months a number of indicators, from sales and guest counts to staffing levels, have all started to trend upwards which leads us to believe that things are starting to improve for the industry,” said Michael Harms, human capital analyst for People Report, a Dallas-based firm that tracks human resource trends for member companies.

The nation’s high unemployment has been a major contributor to the industry’s current low rates of employee turnover. With fewer job opportunities, workers are staying put. Still, turnover is not expected to fall much lower, and job loss is starting to shift. The restaurant industry shed 54,000 jobs by the end of 2009, just over half of the 104,000 jobs it lost in 2008. Additionally, payroll decline for 2009 was just half of the decline in 2008. These indicators point to stabilization in turnover, People Report indicated.

Other indicators also are starting to show signs of positive momentum.

Although the restaurant industry’s average same-store sales remained negative leading in to the first quarter, the top quartile of operators reported positive sales trends, noted People Report’s sister company, Black Box Intelligence, a same-store sales aggregator. [Earlier coverage: “Alook at industry same-store sales”]

In addition, the Conference Board’s Consumer Confidence Index increased in December to 52.9 from November’s 50.6. By comparison, that index was 38.6 in December 2008 and averaged 29.7 in the first quarter of 2009.

“The health of the industry is closely related to the overall health of the economy,” Harms said. “The economy is showing signs of life and consumer sentiment has been improving over the past several months and we’ve seen the result of that in increased comp sales for the industry.”

The Workforce Index breaks down data for four industry segments: quick service, fast casual or limited service, casual dining and fine dining or high-volume concepts. Quick service, casual dining and fine dining all recorded increased expectations for greater employment difficulty overall, when compared with the fourth quarter of 2009.

Respondents in the fast casual or limited service segment said their expectations remained relatively flat when it comes to overall employment difficulty.

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish