The restaurant industry employment recovery stalled in November
As business conditions continue to deteriorate, the likelihood of additional restaurant staffing reductions is rising.
After posting six consecutive monthly gains following the spring lockdowns, the restaurant industry’s employment recovery stalled in November. Eating and drinking places* lost a net 17,400 jobs in November on a seasonally-adjusted basis, according to preliminary data from the Bureau of Labor Statistics (BLS).
The November employment decline wasn’t a complete surprise, as restaurant sales growth ground to a halt in October. As a result, the restaurant industry remains 2.1 million jobs below its pre-coronavirus level.
Looking ahead, there doesn’t appear to be a significant catalyst for a resumption of restaurant job growth in the immediate future. Given the rising restrictions on indoor dining and the likelihood of significantly scaled-back holiday celebrations, business conditions will remain extremely challenging in the coming months.
For their part, fully one-half of restaurant operators expect their staffing levels to decline during the next three months, according to an Association survey fielded in November. Only 5% of operators anticipate increasing staffing levels during the next three months.
On the segment level, fullservice operators (58%) were much more likely than their limited-service counterparts (40%) to say they expect to reduce staffing levels during the next three months.
[It’s important to note that the BLS monthly employment reports count jobs during the payroll period that includes the 12th of each month. Changes in restaurant staffing levels – both negative and positive – have occurred rapidly during the coronavirus pandemic, as restaurants quickly adjust their operating status in response to evolving regulatory and economic conditions. As a result, significant changes likely occurred during the weeks between each measurement period, and the monthly data may not fully capture the total job losses experienced during the coronavirus lockdowns. Based on surveys of restaurant operators, the National Restaurant Association estimates that more than 8 million eating and drinking place employees were laid off or furloughed during the peak of the lockdowns.]
*Eating and drinking places are the primary component of the total restaurant and foodservice industry, which prior to the coronavirus outbreak employed 12 million out of the total restaurant and foodservice workforce of 15.6 million.
Read more analysis and commentary from the Association's chief economist Bruce Grindy.