Restaurant hiring has slowed, just like the restaurant business. | Photo: Shutterstock.
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The June jobs report came out and, frankly, it was weird, particularly when it came to restaurant jobs.
In May, the industry allegedly added 48,000 jobs, which on its own suggested that restaurants and bars were picking up the pace of hiring. That likewise suggested a business that was, maybe, possibly, finding its way out of this low-traffic, weak-sales morass it’s been in over the past three years.
And then, in one report, that was all wiped out. The labor department corrected the previous month’s number, revising it down by 10,000, and then said that restaurants cut 33,000 jobs. One report more or less wiped out all the alleged pre-summer job creation that the industry boasted one month ago.
We won’t get into questions about the numbers themselves. But in reality the data is probably more in line with what’s going on than the original numbers. The restaurant industry has slowed hiring coming out of the pandemic. The number of jobs being created is at about a third of the rate from the before times.
A lot of factors are at play. Technology. The shift to takeout and delivery. Labor costs, in particular. But the fact is, the restaurant industry over that period has been in a low-traffic environment. And restaurant companies in a low-traffic environment don’t hire all that much.
The industry is also full, with overall closures likely exceeding openings when both chains and independents are factored in. Given the country’s relative lack of population growth, this is probably more the norm than the exception going forward.
This week’s financial news
Jersey Mike’s is going public, in part to pay off a dividend paid to its new private-equity owners.
This was a slow news week, at least until Thursday, and so I spent much of my time delving deep into restaurant numbers. I found that total restaurant chain traffic is basically down over the past five years. And fast-food sandwich chains are really struggling.
The Red Lobster Endless Shrimp fiasco is the story that keeps on going.
Just Salad hopes its new partnership will help generate fast-break points. Honestly, it’s really a slam dunk.
McDonald’s really likes plucking chief development officers from growing fast-casual chains.
Luckin Coffee isn’t an app-based coffee chain any longer.
Number of the week
When adjusted for menu price inflation, most restaurant sectors lost sales, which is mind-blowing if you think about it.
Quote of the week
“The profitability will be decreasing a bit because we are decreasing the overall check. But we do expect the situation to improve overall.” Ludovic Garnier, CFO of Thai Union, in comments made in 2023 about the company’s Endless Shrimp promotion. NARRATOR: But the situation did not improve.
On the blog
I wrote about a lot of nerd stuff so you should just go check it all out on The Bottom Line.
On the podcasts
On A Deeper Dive I spoke with Jeff Chandler about the sale of Hopdoddy. On The Week in Restaurants we talked Jalen Brunson, Red Lobster, inflation and, you guessed it, bagels.
For questions, comments or story ideas, send me an email at jonathan.maze@informa.com. And follow me on Twitter at @jonathanmaze. And also LinkedIn. And TikTok.
