The Current Labor Shortage is Bigger Than Increasing Wages


By Jim Needell, HR consultant, Performentor

Jim Needell is an HR expert who works with hospitality and food and beverage employers to incorporate innovative people practices. As an HR consultant for the Family Forward NC Rapid Response program, Jim has helped employers across the state incorporate family-friendly practices into their COVID-19 re-opening strategies. Today, Jim reflects on the current hiring shortages in the hospitality industry and how family-friendly employers have a hiring edge. 

The struggle to bring back and hire full-time staff is a significant challenge the hospitality industry as the economy reopens. Many experts are saying the boost in unemployment benefits, on top of stimulus checks, have made it more worthwhile to stay unemployed rather than rejoin the workforce. 

While this may be part of the story, it’s certainly not the whole picture. There is more to worker retention, job satisfaction and employee engagement. Once we win the battle against every other restaurant or hotel to find new employees, how do we keep them? 

Breaking the high turnover trend (78 percent in 2019) associated with the hospitality industry will become critical for success. If you were guaranteed your employees wouldn’t leave, would you offer them more pay, better benefits, more training and growth?

According to a recent UC Berkeley “One fair Wage” Report, the number one reason that would make workers stay at their jobs was a full, stable livable wage. It’s not uncommon for hospitality employees to work multiple jobs–upward of 70-80 hours per week. And research has shown that mothers in the industry are especially in need of a livable wage to better cover their child care expenses and provide for their families.

The other reasons cited in this report as reasons employees would stay at their jobs were:

  1. Increased hours 
  2. Paid Sick Leave
  3. Better safety (COVID) protocols
  4. Health benefits of Insurance
  5. Improved working environments with less hostility

So as an employer, what can you do? 

  • Many of these items can be instituted at a minimal cost by exploring the available options and spending the time to customize what’s best for your employees.
  • Consider offering the low-cost benefit of prescriptive schedules published monthly to allow parents to plan for child care, doctor appointments or other life needs. If employees knew when they were working in advance, many could work more hours.
  • Offer employees paid sick leave that can be accrued per pay period, which is also a low-cost benefit when considering the actual average usage per employee. 
  • Encourage managers to support front of house employees by enforcing use of masks and other COVID protocols, so customers do not blame them (which is associated with lower gratuities). That’s not only cost neutral, but it’s the right thing to do.
  • Lastly, technology has opened unlimited opportunities for helping your employees get the health and medical benefits they need. Access to a virtual Direct Primary Care Membership and Employee Assistance Programs (for anyone who resides with the employee) can be offered at a minimal cost. There are many community programs available to the lower paid workforce–often the difficult part is connecting your employees to these resources. 

Want more suggestions? Check out the Family Forward NC Rapid Response program or the Guide to Family Forward Workplaces. But just making these minimal changes a priority will be a great start if you want to keep the employees you have worked so hard to recruit. Do it for your employees and do it to support change in the hospitality industry.