Despite Sign-On Incentives, Restaurants Are Struggling to Find Workers

A high end restaurant reopens after the 2010 Covid-19 lockdown, with measures in place to protect staff and customers.
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EsterEv, a popular Milwaukee restaurant, is offering a $40,000-a-year salary to full-time workers and $20 an hour to part-time workers, yet the owner still has to beg employees to come work for him, Bloomberg reports.

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Chef Dan Jacobs is scouring Craigslist and even scouting former prison inmates without luck. “It’s a coin flip,” Jacobs told Bloomberg. “I have to be realistic and realize there is a distinct chance this will not work,” he said, acknowledging the possibility that he could lose both of his restaurants.

Throughout the country, restaurants of all kinds are facing similar problems. Chipotle and McDonald’s are coaxing potential employees with benefits not seen before. Olive Garden is offering $300 sign-on bonuses for positions. The Raising Cane’s Chicken Fingers restaurant chain is offering employees $250 retention bonuses to entice workers to stay on, according to Bloomberg.

Their challenge, according to a survey by the nonprofit One Fair Wage and the University of California-Berkeley’s Food Labor Research Center, is low wages and other opportunities. Half of those surveyed cited these as reasons for quitting, Bloomberg reported.

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Jacobs told Bloomberg that often, candidates apply because they have to show that they are actively looking for work to continue collecting unemployment benefits, but then they don’t return his phone calls.

This comes amid remarks from President Biden earlier this week that there is little evidence to show that unemployment benefits are preventing people from going back to work.

Bloomberg cites Glassdoor economist Daniel Zhao, who believes low-skilled workers are fleeing restaurant jobs for higher-paying fulfillment positions at places like Amazon and other retailers.

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The resistance to filling these positions could spur restaurant industry change overall. Once federal aid runs out, more restaurants could be forced to shut their doors for good if they cannot find workers to fill the increased, and sudden, demand.

This suggests that although some restaurants have increased their wages and are offering sign-on or retention bonuses, it might not be enough. If warehouse distribution centers are offering the same or better salaries as food service positions, restaurants might need to offer even more to sway workers away from jobs that many see as easier and more pleasant than often-grueling, client-facing restaurant jobs.

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About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 

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