Last week, while checking out at the grocery store, the clerk asked me if I had been able to find everything I needed. “No,” I said, “it’s like the store’s been decimated. Was it really busy today? There were a lot of items missing.”
The clerk responded, “No, it’s actually been pretty slow today.” She continued, “We can’t get a lot of things because people won’t go back to work. It’s ridiculous. Just go to work already.”
This attitude is shared by a lot of us. Whether we are employers struggling to find workers, or workers feeling overworked by insufficient staff, many of us believe that we are carrying the societal load but “other people” aren’t. Who’s to blame for this situation largely depends on what side of the aisle you are sitting on.
The problem is that the data does not support either side of the aisle. It is untrue that extra social benefits provided during the pandemic are keeping able-bodied workers at home. Several peer-reviewed studies comparing states that ended benefits early to states that extended benefits found no statistical difference in labor force participation rate recovery. And now, several months after benefits have ended, we still find ourselves with less labor than we need. It is equally untrue that lack of better family benefits is keeping people (especially women) at home. Schools are now re-opened and most of us have left the job of learning to homeschool behind us. Bloomberg recently reported that the growth in labor force participation rates of women has eclipsed that of men.
The low labor force participation rates, while triggered by the pandemic, are actually pretty unrelated to the pandemic. A recent study released by the Boston Fed found that the underlying cause of a decline in labor force participation is pretty straightforward: Baby Boomers are aging out of the workforce. In 2021, Baby Boomers were between the ages of 57 and 75. The average Baby Boomer was 66. When a generation that makes up one-fifth of the U.S. population and one-third of the working-age population retires, the labor force feels it. Statistically, the older an individual is, the less likely he or she is to work. Labor force participation rates peak around 75% in the 25-54 age cohort, while 55-64 drops to around 60%; 65-69 drops to around 30%; 70-74 drops to around 15%; and above 70 is half that again. Whether these individuals don’t need to work, can’t work, or are discouraged by ageism in hiring is irrelevant. They simply aren’t present in the workforce, and every day more and more Boomers are aging into these categories.
What’s a business to do when faced with these macro trends beyond their control? Accept them. Labor force participation rates are not suddenly going to return to their historical highs when people “just go back to work.” If there are fewer workers available as a permanent condition, how does your restaurant need to adapt to the new environment?
First, consider how to increase the productivity of the labor you have. For many of us, increased productivity brings visions of manufacturing production lines and robots that seem alien to the people-driven hospitality and creative meal preparation that we associate with restaurants. But increased productivity does not have to mean robots.
The easiest place to start is with waste reduction. What are your employees doing that they could be doing more efficiently or don’t need to be doing at all? According to lean consultant Steve Crowley at Service Physics, “With a declining participation in the workforce, there is an urgent need for waste reduction — not cost reduction. The distinction between waste and cost is subtle but important.”
After waste has been eliminated from your business, the next way to increase productivity is through technology. Not ready for robots? That’s OK. Simple technologies like check out at table, scheduling software, back-office software and programmable ovens can save your team hours each week.
Second, consider how to make your workplace attractive enough to keep Baby Boomers working. It may be as simple as adding stools to stationary jobs so that employees (of all ages) don’t have to stand for 8 hours straight. Or it may be more complex — creating paths to ownership that will create a stable retirement for them 10 years from now.
Third, for every 10 Boomers there are only 9 Gen Zers (what we call “Gen We” and has recently become known as “Zoomers”) to backfill them. While this is not enough to fill the gap, there are new workers coming into the labor force constantly. To make your restaurant attractive to these new workers, get to know them and what they want out of work. Ask for some reverse-mentoring from your youngest employees. If you don’t employ anyone under the age of 24, ask a child, grandchild, niece or nephew to help you understand what makes work compelling to them and their friends.
Odds are high the answers will be people, culture, community, contribution (that’s why we call them Gen We) and learning. This newest generation to enter the workforce is just at the start of their working life — help them understand how working with you will give them a solid foundation for their career. According to a study by Purdue University, 84% of these young adults expect a workplace to give them formal training.
These young people also want to work at places that share their values. To over-generalize, Gen We tends to be more global and progressive, to care more about diversity and inclusion, and to want to have an impact that goes beyond economics. Your restaurant doesn’t have to operate as a non-profit to draw their interest, but it does need to give back. Share how you contribute to the community as part of your “About Us” in hiring. Gen We also values entrepreneurialism, so it could be that creating paths to ownership for Boomers benefits your newest workers as well.
Finally, Gen We is made up of digital natives. They’ve been playing with iPads and smartphones their entire lives. They expect digital interactions as the most efficient way of doing pretty much everything. Think through how to digitize your recruiting, hiring, onboarding, training, scheduling and payments.
To repeat: The labor force is not going to suddenly grow dramatically and make your labor shortage headaches go away. Accept the new normal and change your business processes and culture to match the expectations of today’s workers.
Meredith Sandland and Carl Orsbourn are co-authors of “Delivering the Digital Restaurant: Your Roadmap to the Future of Food.” After each spent 20+ years in corporate strategy and retail food, Meredith and Carl each concluded that food in America was changing. They left their corporate jobs in search of innovation that would transform the restaurant industry. Ghost kitchens, virtual brands, digital marketing, the gig economy and lean operations are at the heart of the future they envision. For more information, visit DeliveringtheDigitalRestaurant.com or email [email protected].