Business

The restaurant is “breathing the wind” but is fighting back in the face of a labor shortage

View of Philadelphia’s Banned Tap Room. Owner Michael Pasqualello, who owns two other facilities in the city, is optimistic about the future, despite the problems that plague the industry.

Source: Google Earth

Like many in his field, restaurant owner Michael Pasqualello is grateful that the pandemic has overcome the damage done to his business and now does something similar to normal. I am looking forward to it.

He knows it’s not easy.

“We are all grateful to be able to welcome our guests, and we are very grateful to be able to host them,” Pasqualero recently shuffled family and business responsibilities. I said in the usual hustle and bustle of the day. “But that’s another world.”

For people like Pasquarello and his wife, Jeniphur, who run three restaurants in the Philadelphia area and soon open another, the world has changed dramatically from what they knew before March 2020. ..

The burden facing the hospitality industry is probably better than any other company in the country, except for education. Owners faced protracted air revolving doors with closures, space restrictions, hygiene regulations, and uncertainties about:

Some survived thanks to government support, takeaway projects, and the luck of a draw, but many did not. In addition, they are currently facing serious labor shortages and regulatory and legislative obstacles.

The burden lies on the sector, where success in regaining its foundation is essential to the path of post-covid recovery in the United States.

“Mixed bag of tricks”

Pasquarellos was able to overcome the crisis by adapting to the unique assets of each business.

Café Lift offers brunch-type dishes that are perfect for takeaway. Behind the Kensington Quarters is a large outdoor space to accommodate people who eat when indoor seating is prohibited. Bar seats could not be provided in the banned tap room, but became “streetly” when the city allowed businesses to use parking spaces.

“Like everyone else, we didn’t make money, but it was good to start a business,” Pasqualero said. “So it was a mixed bag of tricks. Each place had to come up with different ways to deal with this.”

Many of such businesses were not so lucky.

According to the National Restaurant Association, more than 110,000 bars and restaurants closed in 2020. In most states, severe blockades imposed to fight Covid-19 have completely closed companies that were already operating at low margins and reopened them with almost limited capacity.

However, vaccination gives hope to the pandemic battle, so fate may begin to turn into a hospitality-focused business.

“I’m very optimistic about returning to where I was,” Pasqualero said.

Not everyone is convinced.

Responding to labor shortages

In other parts of the country, the situation is less clear and does more than just resume under the conditions of the Covid era.

Carlos Gazitua is the CEO of Sergios Family Restaurant, a group of Cuban restaurants in Florida.

Gazitua is preparing for the summer, which it expects to break records in terms of demand, but a serious problem on the other side: all customers who are anxious to return to eating out again. I am afraid of serious problems such as getting enough workforce to deal with.

“We are expecting a record number here in the summer,” he said. “We expect all hotels to be booked and restaurants to make a fuss. Then it’s a different story. When the stimulus goes away, you’ll understand where the industry is.”

In a situation that is not unique to bars and restaurants, Gazitua is now summarizing the essential challenges. Many positions are open, but it is very difficult to fill them due to several factors.

According to the US Chamber of Commerce, unemployment benefits have been strengthened, discouraging low-wage workers from returning to work. There are also skill mismatches, which not only make workers struggling to adapt to new areas, but also prolong their fears of the future course of the pandemic.

Whatever the cause, shortages are stressing business owners who are trying to staff and employees who have to work longer to make up for the shortage of available staff.

“We raised wages. We have about three different staffing agencies that are always looking for people,” Gazitua said. “Other restaurant owners are handing out leaflets and roaming the neighborhood. The heroes of our community are the people who are currently working for you and me. These people are on fire.”

The April Non-Agricultural Employment Report shocked when the Ministry of Labor said the economy added just 266,000 jobs during the month Wall Street expected 1 million. ..

Some economists cited increased unemployment benefits as a factor behind the labor shortage, while others said the numbers could have been statistically anomalous. All other employment market indicators, including unemployed billing, ADP’s private salary, and the Conference Board’s report that the April employment index rose 2.7% and is now 45.7% higher than it was a year ago. Is a plus.

However, according to the Bureau of Labor Statistics, the hospitality industry lost more than 2.8 million workers from its pre-pandemic state in April, with an unemployment rate of 10.8% compared to 6.1% at the national level.

Tattered industry looks for hope

Kirby Mallon, owner and president of Elmer Schultz Services, believes that employment in this sector is struggling in close-up in his business of repairing kitchen equipment in restaurants, nursing homes, hospitals and schools. He is also based in the Philadelphia region.

“In general, restaurants are blowing the wind. These people are crying on my shoulders,” he said.

Kirby Mallon, owner and president of Elmer Schultz Services.

Courtesy Kirby Marron

Maron knows some of their pain — he too has a hard time finding workers despite his hiring efforts as chairman of the Nonprofit Commercial Food Equipment Services Association. He said there were few takers, despite high unemployment, lucrative wages, and ample opportunities.

In March, Pennsylvania had an unemployment rate of 7.3%, neighboring New Jersey had an unemployment rate of 7.7%, and the national unemployment rate was 6%.

“We can’t hire quality people,” Maron said. “It’s always been a problem in the industry, but it’s definitely the most serious problem so far. We can’t even find someone to train.”

But Gazitua sees another impediment to job creation: the Biden administration’s impetus for companies to ultimately pay tip workers the federal minimum wage. As a member of the conservative JobCreators Network, Gazitua is a business advocate who says the hospitality industry has been chosen, while other professions such as real estate and insurance do not have to pay the minimum wage.

“I think it’s a bit hypocritical that they are attacking the restaurant industry’s sales model and hiring people when the industry is disproportionately affected during the coronavirus pandemic,” he said. It was. “It’s a bad idea to change policy and change the sales model of an industry that hasn’t recovered.”

Still, Michael Pasqualello is waiting for the opening of a fourth restaurant shortly, hoping that some stability will return to the industry as things go on.

He wasn’t worried about staffing and didn’t have to pay higher wages. Instead, it’s less stressful than the average restaurant scenario and relies on a work environment that guarantees managers health insurance for two consecutive days.

“We call it’culture’and we are trying to establish a family culture in a place we think is beyond the financial part,” he said. “It will take time, but on the other side of this, I think the industry is in a better place and everyone is making more money, so I’m very optimistic.”

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Correction: The Conference Board said the April employment index rose 2.7%. The month was wrong in previous versions.

The restaurant is “breathing the wind” but is fighting back in the face of a labor shortage

Source link The restaurant is “breathing the wind” but is fighting back in the face of a labor shortage

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