Are you a restaurant owner who is feeling the heat of labour shortages? If so, you’re not alone.
In the realm of food and beverage – particularly independent restaurants, owners and operators are facing this challenge in a variety of ways. From innovative labour-reducing technology to out-of-the-box methods of recruitment and increased awareness towards broader social and economic factors, many industry players are employing new strategies to keep up with customers and avoid turnover.
Let’s take a closer look.
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Ontario-Wide Labour Shortages
Across North America, a wide range of emerging (and pre-existing) factors have increasingly strained the supply of available labour in recent years. While certain countries, regions, and cities are seeing greater impact than others, the problem certainly isn’t unique to one particular place.
As Canada’s largest province by population, Ontario’s economic landscape tends to follow distinct trends of its own. While other provinces are also dealing with similar challenges related to low labour supply, Ontario’s unique demographics highlight a wide range of ways that businesses and consumers are being impacted.
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Is Cost of Living the Primary Culprit?
There are undoubtedly a number of factors contributing to the labour shortage, however, the province’s steadily rising cost of living is arguably the most significant of these elements. Across Ontario, the volume of annual income needed to cover basic expenses continues to climb year over year. However, this phenomenon isn’t impacting every industry in the same way.
In the food and beverage world, it’s not uncommon for staff wages to be close to minimum wage. While this has been an industry standard for many years, everyday expenses are a lot different today than they used to be. As a result, restaurant owners are facing greater pressure to increase wages compared to businesses in other industries. Unfortunately, this isn’t always a feasible solution for a small or independent business.
Small Towns vs Cities
Toronto is noted across the world for its high cost of living, but what about Ontario’s smaller towns and communities? While most small towns are more wallet-friendly than the province’s urban hubs, there is still a gap between the general costs of living and what many independent restaurants can reasonably afford to pay staff members.
As of February 2023, Ontario’s minimum wage sits at $15.50 an hour. Many economists have noted that this simply isn’t enough for most people to cover their costs of living. In the province’s most affordable areas, a “living wage” starts at $18.05 an hour and in the most expensive region (the Greater Toronto Area) it’s north of $23.00 an hour.
Impact on Businesses
Every business is unique and as a result, is impacted differently by the labour crisis. In fact, some smaller food establishments with a stable roster of long-term employees could experience little to no strain at all. However, most restaurants are feeling the heat in some way, introducing new challenges for owners, managers, and existing team members.
Recruitment
Restaurants that are just starting up or those who are low on staff members are seeing a more difficult recruitment process than in years past. Given the record-breaking costs of living, many candidates are gravitating towards the employer that’s offering the highest dollar amount – giving businesses with more capital advantage over everyone else.
In more expensive markets like Toronto and Hamilton, some restaurants are actively advertising that they pay the “living wage” in order to stand out.
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Burnout
Adding fuel to the fire of these employment challenges is burnout. With fewer members on staff, many restaurant employees (including management and leadership) are working longer hours – increasing the risk of burnout. Employees that feel overworked or underpaid will be more inclined to seek work elsewhere.
Reducing Labour Reliance
In light of the many difficulties restaurants are facing, new strategies are emerging for reducing the need for employees. Most notably, labour-saving technologies have become increasingly prevalent in restaurants across Ontario in recent years – particularly in franchises.
Tools like self-ordering kiosks, virtual checkout, and mobile ordering have become popular solutions for reducing the number of staff on-site during business hours. While there will always be a need for human labour, these technologies are making things easier for the time being.
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