With vaccinations rising and the rate of COVID-19 decreasing, the U.S. is reaching a crucial turning point in its battle with the pandemic.
But as economies open up and Americans feel more confident moving around, the country faces another major obstacle—how to convince individuals to return to work. U.S. job openings increased by 597,000, or 8 percent, to 8.12 million in March, according to the Department of Labor. That’s the highest level ever recorded by the Job Openings and Labor Turnover Survey, which has collected data since December 2000.
Restaurants are feeling the full effects of the labor crunch. The industry added 187,000 jobs in April, but it’s still 1.65 million short of pre-pandemic figures, according to the U.S. Bureau of Labor Statistics. Indeed, it is quite rare to walk past a location—whether it’s quick service or full service—without seeing a “help wanted” signed plastered to the window.
Applebee’s, which has roughly 1,600 domestic units across the U.S., isn’t immune to the effects of the labor shortage. But COO Kevin Carroll wants to cast away any negative connotations associated with this fact. It’s true, Applebee’s is searching for 10,000 employees to join its team, and that’s because the casual-dining giant is growing. The company believes it achieved two of its highest-volume months ever in March and April, even though the database only goes back 13 years. Applebee’s captured 11.4 percent same-store sales growth in April compared to 2019.
“So the good news for us is we’re in this—as our [Dine Brands] CEO John Peyton likes to call it—a restaurant renaissance,” Carroll says. “There’s a lot of pent-up demand. As you know, people are getting vaccinated, so I think they’re feeling a little more comfortable getting out and dining in restaurants.”
“So while we’ve always continued to hire and we’re not in any specific dire straits when it comes to team members, we do need more team members as a whole for the brand just to take care of the demand we have,” he continues. “So really good problem to have versus where we were a year ago when we weren’t even sure we were going to get dining restaurants back open.”
Applebee’s big push comes Monday via National Hiring Day in which the chain will interview as many people as possible from 10 a.m. to 8 p.m. Carroll says the goal of 10,000 is “very doable,” especially considering the brand already has more than 20,000 applicants set up for interviews. The available positions include full-time and part-time openings, such as host, to-go, server, bartender, cook, dishwasher, and management. Every candidate 18 years or older that attends an interview will receive a free appetizer as part of Applebee’s “Apps for Apps” program.
As the company seeks more employees, it will face stiff competition from restaurants that have upgraded their benefits package. Olive Garden parent Darden Restaurants decided to raise the wage of tipped and non-tipped employees to at least $10 per hour, including tipped income. That will increase to $11 per hour next year and $12 per hour in two years. And on the quick-service side, McDonald’s and Chipotle have recently raised the average hourly wage of their workers.
Although Carroll can’t say for sure what all franchisees are planning, he knows operators are doing their best to remain competitive in every market.
“They see what’s going on at some of the local [quick-service restaurants] that are out there offering sign-on bonuses and doing other things and the like to get team members to come work for them,” Carroll says. “But I don’t feel like we’re in a position where globally we needed to have those discussions because we do find ourselves pretty well-staffed in most of our restaurants. But certainly everything’s on the table locally for those that are fighting a little bit tougher battle trying to get a team member. I’ve heard of them doing sign-on bonuses and things of that nature.”
A vital part of Applebee’s recruiting efforts is that all positions have potential for career development and advancement. Carroll uses the example of Michelle Bloom out of Kendallville, Indiana, who recently won General Manager of the Year. Bloom started as a prep cook and then transitioned to kitchen manager and assistant manager before becoming the leader of the Applebee’s store in Kendallville. In addition to upward mobility, the chain offers flexible scheduling and discounts with more than 100 retailers, such as Amazon.
“My belief is that with the benefits that we offer and the fun environment we have, when they get in and they realize they can work with their friends and neighbors, they’ll have no reason they want to leave,” says Applebee’s COO Kevin Carroll.
Carroll notes hiring efforts aren’t restricted to one specific geographic area. Applebee’s is aiming to cover its bases in all 1,600 franchised and company-owned units.
“As sales have picked up, and as local mandates are lifted and restaurants are able to open back up to 50, 75, 100 percent capacity, we found the need to get more team members everywhere,” Carroll says. “So I would say it is a systemwide push that we’re making to get team members. It’s really to meet the demand more than it is the fact that we found ourselves in a staffing crunch.”
Many operators have pointed toward the weekly $300 unemployment boost from the federal government as the reason why labor is so hard to come by. The issue has become so large that President Joe Biden announced unemployed workers must accept suitable job offers or lose unemployment benefits. Additionally, at least 16 states have decided to end benefits as early as June 12 and as late as July 10 even though the enhanced benefits don’t expire until September 6.
Earlier in May, Peyton described the labor shortage as a “point in time where the labor market is sorting itself out.” He estimated that it will take three to six months to reach steadier trends. Carroll says some may still be hesitant to return because of health and safety reasons. That’s why Applebee’s pitch to potential employees will not only include the lure of benefits, but also a host of ways restaurants have enforced COVID precautions, like creating a “sanitation specialist position,” removing condiments from tables, and utilizing digital menus.
“Our ability to deliver a great safe environment for a new team member is what we look forward to sharing with folks when they come,” Carroll says. “ … I think having a safe place to work is what people are looking for right now and I think we can provide that for them as is evidenced by the amount of team members that we have now.”
Carroll acknowledges the labor shortage has pressured the supply chain. He says, “You can’t turn on the news without hearing about truck driver shortages or shortages with chicken and some other items.” The good news, however, is that Applebee’s has a solid partnership with the supply chain purchasing co-op that franchisees use. So even as demand has risen, the brand hasn’t run out of food in any location, and the COO is confident that will continue.
To improve labor efficiency inside restaurants, Applebee’s partnered with FlyBuy, a curbside pickup solution that helps restaurants identify when customers arrive. The new technology has improved speed of service anywhere from three to five minutes. Also, dine-in guests are able to pay by phone and workers in busy restaurants are using handheld tablets to wait more tables and earn more money.
Because of those initiatives, Applebee’s guest satisfaction scores are as high as they’ve ever been. The 10,000 hiring surge intends to keep it that way, Carroll says.
“If we had to fill up every seat in the dining room tonight, it might be a challenge, which is part of the reason, obviously we’re going out to try to get ahead of that because we do know some governors will be opening their states and have started to do so,” Carroll says. “So we want to make sure that we’re prepared for that. But to this point, we’ve been very excited about the guest satisfaction scores that we’ve been receiving in regards to affordability to food to service. We’ve been able to hold our own. We’re happy about that.”
“ … My belief is that with the benefits that we offer and the fun environment we have, when they get in and they realize they can work with their friends and neighbors, they’ll have no reason they want to leave,” he continues. “The short answer would be, I hope it’s all over Monday for us. And we’ll keep hiring obviously every day. But this additional surge of team members to help our franchisees and get our restaurant staffed I think is really going to make a huge difference for us.”