Restaurants Deal With Scarce Labor, Hungrier Diners

Last year’s “Great Resignation” led to giant labor shortages in the food service sector, leaving many eateries to turn to automation to meet order and delivery demands.

This year, market instability is driving restaurant trends, particularly companies’ plans to invest in labor-saving technology to woo new workers and boost wages.

Meanwhile, restaurants are also trimming menu options and doing away with curbside pickup to balance labor and supply chain pressures while also helping operators reduce costs.

Truncated menus can help by streamlining production for off-premises orders, said Meaghan Brophy, a retail content producer for Fit Small Business. And Rick Camac, dean of restaurant and hospitality management at the Institute of Culinary Education, said that abridged menus could become a fixture at restaurants, as labor shortages make it harder for restaurants to reintroduce menu items they had removed.

Takeout and online ordering dominated the restaurant industry during the COVID pandemic, and customers continue to depend on those options.

Mobile orders made up more than quarter of all Starbucks orders and nearly half of Chipotle orders last year, but these chains and others like them are fast realizing they can’t keep up with fulfillment amid recent labor and ingredient shortages. This has led many businesses to shutter their delivery orders during peak hours to level off imbalances in supply and demand.

This uptick in demand can also be attributed, in part, to diners just eating more than they did before the pandemic. For example, American consumers spent 14% more on restaurant and grocery items in October 2021 than they did in October 2019.

In general, spending on food delivery and at restaurants is now higher than ever, but mass closures mean fewer establishments are there to divide the workload.

For more on how automation and order throttling tools can help restaurants relieve the pressure on their staff and keep customers satisfied, download the Order To Eat Tracker, a collaboration between PYMNTS and Paytronix.