An estimated 62% of restaurants said recruiting and retaining staff was a very or fairly significant challenge. |Shutterstock.
Restaurants should not underestimate the costly impact of understaffing.
So argues a report out Thursday from the National Restaurant Association and Workday, which found that understaffing is not just a marginal inconvenience, it is a material drag on growth, service quality and sales.
“Being short just one employee can cost a restaurant thousands of dollars in annual sales. The restaurants best positioned to grow are those that treat workforce decisions as a business imperative,” said Chad Moutray, the association’s chief economist, in a statement.
Restaurants employed an estimated 15.7 million people in 2025, which is about 10% of the nation’s workforce, the report said.
According to the report, the number of restaurants that said they were understaffed is shrinking.
In 2025, 22% of operators said their restaurants lacked enough staff to meet consumer demand. That was down from 32% in 2024 and well below the 78% in 2021 in the aftermath of the pandemic.
But Moutray, who spoke this week at the Restaurant Leadership Conference in Phoenix, said he expects workforce challenges to get worse over the next few years, with population rates declining and immigrant deportations continuing.
The Congressional Budget Office projections for growth in the population have the U.S. going net negative as soon as 2030, and Moutray said he expects it will be sooner.
“I think that really begs the issue of where your customers are going to come from. Where is your labor going to come from? And, obviously, from a federal standpoint, where’s the money going to come from?” he posed.
The National Restaurant Association report found that 62% of operators said recruiting and retaining employees was already a very or fairly significant challenge for their business.
And those that are short-staffed are feeling the impact.
Nearly 8 in 10 short-staffed restaurant operators said it limited their ability to grow, leading to slower service, reduced sales and increased overtime expense and employee stress, the report said.
Nearly half of understaffed restaurants said they could not operate at full capacity, and 43% postponed expansion plans or modified their menus. More than one-third (34%) reduced hours, and 1 in 5 closed on days they would normally be open.
The pace of hiring also has an impact—and that’s where use of technology can help.
New employees can be a short-term cost to the business. When a new hourly worker is hired, it takes an average of 31.8 days on the job for them to become “net positive. For managers and salaried staff, it takes an average of 72.2 days, and other leadership roles could take 3-6 months, the report said.
Technology available to the industry has helped reduce the time it takes to hire new workers to as little as 1 to 3 days, the report said, including automation, AI-enabled tools and data-driven platforms that can streamline recruitment.
Post-hire technology tools have also helped improve workforce management. Nearly half of restaurants now use scheduling software, 40% provide digital onboarding resources, and only about 26% said they use AI tools.
But, despite widespread fears that technology use would eliminate jobs, that doesn’t appear to have happened.
When asked if jobs had been permanently eliminated over the past two to three years as a result of an investment in technology, only 6% of all operators said “yes.”
Joe Guszkowski contributed to this report.
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