Workforce Challenges in Northeast PA's Restaurant Industry

Summary of Study

During the COVID-19 pandemic, simultaneous state and federal regulations slowed many industries as others came to a hard stop. The restaurant industry belonged to the latter group. Though many food and drink establishments conceived innovative ways to continue doing business in a safe manner, the industry and its workers suffered. In 2021, food and beverage businesses have reported new challenges related to workforce.

The vast majority of food services businesses have weathered the pandemic so far. In Lackawanna and Luzerne counties, there were 22 fewer establishments classified as Food Services and Drinking Places in the fourth quarter of 2020 than one year earlier, prior to the pandemic. This represents only 1.7% of all such establishments in the region – though the industry did account for about 15% of the net decline of 148 establishments in all industries during that period, despite comprising just 9% of all establishments. Similarly, employees in the restaurant industry were disproportionately impacted by pandemic closures and restrictions due to the nature of their profession.

Workforce pressures are also challenging this industry. There was a 14% decrease in job advertisements for food and beverage serving occupations throughout 2020, coinciding with business closures. In the last six months, however, there were 125% more openings in the profession compared to 2020 as a whole. Another sign of high demand for food service workforce is the duration that job postings remain open. In 2019, job postings for food-related occupations averaged 24 to 38 days. Postings now remain open an average of 51 to 62 days.

Compared to listings posted in 2020, the share of ads offering full-time work increased by nearly 15% in the last six months; this coincides with recent reports and anecdotal evidence describing an increase in full-time positions being offered in occupations and industries that, in the recent past, were more often filled by part-time workers. More wage growth may be expected, though employers may be constrained by the fact that many industry workers’ earnings are largely in the form of tips. Innovative solutions, such as expanding full-time offerings, benefits, or a transition away from tips as compensation for restaurant workers can be explored in order for firms to compete in the current labor market.

Read the full policy report here.

Feature Charticle

The Institute for Public Policy and Economic Development

Findings:

  • Between the fourth quarters of 2019 and 2020, employment declined by more than 3,400 workers in the food serving industry, including 2,377 in a slightly narrower subset of all restaurants.
  • In the broader industry, this decline represented nearly one in five workers.
  • As of early 2021, there was a 23.1% unemployment rate in food preparation and service occupations, in stark contrast to the overall regional unemployment rate of 11%.

Read the full policy report here.