There are undeniable green shoots these days with labor. The restaurant industry’s workforce is projected to grow by 500,000 jobs, up to 15.5 million, by the end of 2023, according to The National Restaurant Association. Between now and 2023, an average of 150,000 jobs a year would be added, with total staffing levels climbing even higher, to 16.5 million, come 2023.
Per federal data, restaurants and bars added about 98,600 jobs in January, bringing the total employment up to 12.2 million. They tacked on 69,900 jobs in February, leaving the sector roughly 100,000 shy of pre-pandemic levels. Early on, COVID cost restaurants 5.9 million jobs—5.5 million in April 2020 alone. But the industry is now, at last, closing in on February 2020 measures. The Association then expects the field to keep growing. December 2022 represented the 21st consecutive month with more than a million unfilled job openings in the restaurants and accommodations sector, according to the BLS. Before that stretch, hospitality-sector job openings had only surpassed a million once in the entire 22-year history of the Job Openings and Labor Turnover Survey data series. So there’s space to tackle.
But just because numbers are approaching normalcy from a count level doesn’t quite mean the industry is. The stakes of labor readjusted as the pool did. Operators in a survey told the Association first-time employees filled 22 percent of openings last year. It was even higher—27 percent—in quick service. Fourteen percent of job openings in 2022 were filled by people promoted internally. Four in 10 quick-service positions were taken by either new entrants to the workforce or people being promoted from other positions within the same restaurant. In table service, the number was three in 10.
Simply, this crop of workers, in many cases, are products of a post- or mid-COVID environment; one with changed demands and different conditions.
And more help is needed. Sixty-two percent of operators said their restaurant couldn’t support customer demand with the number of people employed.
A full 89 percent of operators cited higher labor costs as a significant challenge for 2023. Eighty-six percent felt labor costs were higher last year than 2019 and labor outlayers rose 18.3 percent.
Among those who claimed to be understaffed, 67 percent said their restaurant was more than 10 percent below necessary levels; a little over a quarter were 20 percent-plus under. Seventy-nine percent indicated they currently have openings that are tough to fill. In family, casual, and fine dining, 83, 85, and 84 percent, respectively, said they were struggling to staff the back of the house.
Will it ease up this coming year? Thirty-five percent of operators actually think it will get harder.
The makeup has shifted as this world has. The BLS predicts the number of teens in the labor force to decline by 1.1 million between 2021 and 2031, while 20–24 year olds will fall by 500,000. Only 30 percent of 16–19 year olds are expected to be in the labor force by 2031, down from 37 percent today and the lowest level on record. It also estimates 68 percent of 20–24 year olds will be in the labor force by 2031. That’s down from 71 percent rate and would represent the lowest figure since 1968. Older adults, meanwhile, will represent the fastest-growing age cohort. The BLS projects 4.9 million adults aged 65 and older will enter the field during that span.
All told, it’s a lot of figures and concepts to crunch, but the overarching sentiment isn’t all that complicated. What it takes to hire and retain isn’t the same as it was pre-2020. The demographics have shifted, and so has the bar.
And for brands that make an employee-first approach the lead part of their strategy, investment to ROI has never been clearer.
At Nashville-based Biscuit Love, employee care has factored in since the beginning.
Karl and Sarah Worley have implemented and nurtured a sustainable employee care program for over a decade. Think on-staff therapists and access to discounted life resources. They recently opened their first out-of-state location in Birmingham, Alabama, and, in March, plan to debut a fourth store in Middle Tennessee.
FSR caught up with Karl Worley to discuss the NextGen Casual’s origin story, its employee-centric ethos, and why all of it is leading to sustained and reenergized growth.
Firstly, tell us about Biscuit Love and its origin story.
We were blessed enough to be loaned a food truck, and all we had was an idea scribbled on a napkin of what we wanted it to be. It developed from there, and we ended up in our first brick-and-mortar location in The Gulch before it was even The Gulch, before it was capitalized. We didn’t know how integral that would be into who we were, we cooked honest food and were nice to people. I will never forget opening the first day and looking at Sarah and saying, “Oh my God I have no clue what we are supposed to do.” She then told me, “Karl, we are going to cook good food and be nice to people and see what happens.” She was pretty brilliant, because it worked. People started celebrating us, which still feels weird to say. At some point in that timeframe, our mindset shifted from being recognized and wanting to win a James Beard Award for Best Chef to more of a mission to change the restaurant business.
What inspired the employee care part of the business? How did you all set out to change that dynamic as generally seen in restaurants?
I will never forget my first internship out of school where I was berated and yelled at the first night—I had to be adult enough to walk into the office at the end of the night with the chef and say it was not for me, this is not the environment I want to be in, and I am not learning. Sarah and I came into the restaurant business as full-grown adults at 30. I knew that people end up in the food business because they love serving others, but a lot of people end up there because life hasn’t given them a fair shake.
We saw that with restaurant No. 1 when we were working side-by-side with our staff at The Gulch. I think the light switch moment for both Sarah and myself happened when sitting down for breakfast with a guy we had working on our team—he said up until this point that no one had known his name, let alone cared about where he came from or who he was as a human. Sarah and I had so many crazy ideas, and one day the right ball fell into the hole for us—her mom was a therapist and was about to retire but wasn’t quite ready. That was the catalyst for this crazy idea.
What are some ways the brand achieves that today, starting with the on-staff therapists?
We all as humans screw up a lot, and so I always preface that with new employees. Everyone is going to mess up, but I think owning our actions and learning to admit when you make mistakes is critical. We’ve always seen Biscuit Love as this kid that we’ve been interested in guiding, something we are stewarding. It is up to us to raise Biscuit Love similar in the way that you raise a kid, in that I want it to kick ass, change the world, and be the best version of itself. And that doesn’t mean taking a lot of money from it and mooching off of it. I can’t imagine Gertie—our daughter—being 30 years old and making a lot of money and me going, “Hey I am going to need a bunch of money each year, because I got you here.” I think Sarah and I see Biscuit Love the same way.
How has it evolved over the years, especially ever since 2020? What was Biscuit Love’s response to the COVID dynamic in those early days?
When we first said we were going to have therapists on staff, it was in hopes that people would start seeing therapists. Our therapists work day-to-day alongside our staff. They are doing dishes, bussing tables, talking to guests, and running the cash register. It allows for staff to start getting comfortable with them and opening up. We found initially in our plan that the shame cycle was triggered after telling all of their deep dark secrets, and it kind of morphed into what I call an ambulance role.
They are there to triage—if they get a call about someone wanting to take their own life or getting evicted, their role is to get them ready for therapy. Sarah and I pay a significant portion of the first six visits, but we’ve got people who have been 20-25 times. We both believe that if you are going to put out a little money and work on yourself, then we want to be a part of that because it is going to make our business and the people around them better. With all that to say, we were still missing the mark.
Yes, we were doing this really good thing, but how were we missing it? We were missing the Spanish speaking population and their own set of needs. Sarah and I look through the world through a Christian lens—whether you look at it through a spiritual lens or a lens where you don’t really believe in anything, the one thing we can agree on is that the puzzle pieces are in line. It’s kind of up to you opening your eyes, seeing them, and putting them into place. One of our very first employees, Rachel, wanted to get her therapy degree and wasn’t really sure what to do with it. Growing up in Miami, she took on our Spanish employees, understanding their different set of needs and what they’re looking for.
After 2020, it morphed into people needing a lot more. I have a bi-weekly session with my therapist, and if I miss that, I am not the best human I can be. I think mental health has played a more integral role as we have come out of the shock of 2020, especially in the restaurant business where we didn’t get a chance to work from home for two years and really grieve. The world stopped and our lives were upended—we just kind of put our heads down and worked through it, and that puts trauma in us that we need help working through. As our economy has grown, especially in the Nashville area, it still kills me that these employees that we pay fairly and better than industry average can’t afford to live in the same areas that our restaurants are because rent is so high. Now, it’s changed a bit into a role of coping and helping people get healthier in a sense, while also solidifying that I don’t want to ever see a Biscuit Love without these people in place.
“I hope that Biscuit Love continues to celebrate people and make them want to be better humans, where hospitality gets to shine as what it was meant to be originally, which was a hospital for people—just a soul hospital where they can come and get nourished, get rest, and be even better human beings.”
Talk about the onboarding process and how Biscuit Love implements ongoing education to keep employee care top of mind.
I think it starts with some of our biggest cheerleaders and mentors. We always believe in having mentors and being mentored at Biscuit Love. We’ve tried over the years to home in on people who are resilient and want and care about getting better. I think that breeds the ability to pour into people that will appreciate that work environment. We don’t allow nicknames, and we believe your name is your name and the name you were given. A lot of times you will see eye rolls when we take people in and tell them no nicknames, no smoking on shift, and here’s the things we are going to do and why.
We take everyone through a culture class where we teach them how to have healthy conversation. I know I didn’t grow up with that, so I want people to learn a vocabulary and the words to say, “Hey I had a really tough home life last night and am not having a great day, can I just roll silverware.” Versus coming in and not knowing how to vocalize that, because they don’t know what they are feeling and how to feel it. As we grow and home in on what we are trying to do, it becomes more and more clear that we have to hire the right people. And that’s not saying that their lives are perfect but hire people who genuinely want to work for a place that is safe and keep it that way.
I’m a fan of this no-nickname rule (people called me “Squeaks” in high school …) What goes into the buy-in process for employees on these kinds of core values? How do you recruit to find people who fit the mold you’re looking for?
It’s a work in progress. If someone calls you a name, it’s probably not because you said, “I really like this name, please call me it.” It’s generally based on something you feel ashamed about or you don’t like about yourself. People will jump on that to make themselves feel better. Even when explaining that, we still get people who will try and push boundaries because it’s hard to change. I think—knock on wood—we are growing slow enough that our culture has permeated. In Birmingham, it’s so amazing to go down and see a store that is brand new, living those values because the people who are doing the hiring now are looking for the right things and care enough about our culture to want to be better every day. They value people enough to look at them and see what they can contribute to our culture to make us better.
How big of a role do you think this all plays in the brand’s success? In other words, what kind of case study is there for other restaurants to pay better care to their workers? It seems an obvious thought, but sadly not one that’s put into practice enough.
It’s sad that it’s not put into practice enough. In the early 1900s—when we said the good old days and the Hersheys, Carnegies, and Vanderbilts were around—when you look back, Hershey thought about where he placed his chocolate factory in Pennsylvania enough to attract the best talent so he could build really good schools and pour back into the community. He didn’t take all of the money because at the end of the day, all of the money in the world doesn’t do good compared to sharing the wealth and building up your community. I think somewhere along the line in this business, we have lost that ability to see that if we pay employees well, give them healthcare, encourage them to use it, and give them mental health resources, they are going to be better and business will hopefully be easier. Sarah and I hope to at least leave a mark on the world when Biscuit Love ceases to exist or Sarah and I have left the world.
Our chosen mission is to make the field of hospitality a better place. That’s where I stand from a philosophy standpoint. The last time we had a study done, our retention rate was 83 percent and for us to take on an employee from day one to what we think is proficient is about $3,200. We did the math on it at the time when we had about 100 employees. We then took somebody we saw as a good restaurant and compared—they had about a 20 percent retention rate. We took the same numbers and figured out on paper alone how much we were saving a year, just helping people get healthier. It made sense to us. It took a few years for us to do it in the math form—we could feel it, understand it, and know it—but once we did the math it made sense all around.
Where does the brand go from here? Is growth on the table?
I hope there is growth. We are starting to grow slowly and understand what that looks like. I have always been a fan of Chick-fil-A if you take the politics out of it and just look at them from a business and brand standpoint—the ability to grow as fast as they are growing and keep their culture as strong as they have is mind warping to me. If we could grow two to three stores a year and keep our culture, I would consider that a win.
Sarah and I want to continue to grow and begin to look at all of these crazy other ideas we have. As a breakfast business, most employees are out by 5 p.m., but childcare can still be tough for some. Sarah really wants to figure out childcare for our employees. How do I give our dishwasher a chance at home ownership and a chance to sew into the community and plant themselves in a different way. I hope that Biscuit Love continues to celebrate people and make them want to be better humans, where hospitality gets to shine as what it was meant to be originally, which was a hospital for people—just a soul hospital where they can come and get nourished, get rest, and be even better human beings.