The changing face of hospitality

If you manage any type of hospitality business currently you have likely experienced many challenges that you have never seen before. From supply issues to labor shortages, it is harder and harder to keep a restaurant, bar, hotel or entertainment venue running.  The chart shows the workforce participation rate in the United States over the past 10 years. When the pandemic started and places where people gathered where shut down or greatly restricted many hospitality workers were forced out of their jobs. In some areas, the shutdowns and restrictions prevented them from returning for many months if at all. A large portion of the hospitality workforce was tipped workers who depended much more on the flow of guests providing gratuities then on the actual paychecks from the employers. For those workers, going back to work under strict occupancy limits had a huge negative impact on their income.

Many hospitality workers were forced to find other ways to make a living. They changed careers, started their own businesses or retired. Another factor was that many hospitality workers were from two income families. Post pandemic, many of these families have chosen to change their lifestyles and live on one person's income instead of two. At first glance that doesn't seem to make sense, however when you look deeper it does.

Over the past several decades the purpose for working has changed. People used to base their lifestyle on their income. For example, they built their spending budgets around what the family made and if they could not afford something they did without. They put patches on clothes instead of buying new. They passed down outgrown clothing, instead of throwing it out and just getting new for the smaller kids. There were not computers, video games, cell phones, tablets, air pods, air fryers, drones, and on and on that somehow became necessities instead of luxuries. We evolved into a society where we strove to make our income match our spending instead of matching our spending to our income. We didn't just want a cell phone; we wanted the newest and best $1200 cell phone. We didn't just buy our kids shoes; we had to buy the $300 designer shoes. $30 Levi's weren't good enough; we had to have $200 designer jeans. These spending habits made it a necessity for both adults to work in two parent households just to keep up.

When the pandemic hit, and many were suddenly out of work, they had to rethink how they spent money. Many realized they didn't need the $1200 phone or the $300 sneakers. Then they also realized that the majority of that second income was going to pay for daycare. They found out that if only one worked, and they spent more wisely, they could actually live just fine or even better than they were before.

Add to this the behavior of guests when hospitality venues did reopen. When workers were put in charge of enforcing new rules, like social distancing or wearing masks the guests that didn't agree took out their frustration on the poor worker standing in front of them. The guests that did agree demanded that the front-line workers act like police to enforce the new rules. Hospitality work has always had its frustrating moments and unruly guests, however post pandemic it's tenfold.

Now add in that most places are short staffed due to the changing labor market. Now our already stressed workers are being asked to do the work that two or more did before. I stopped in a very well-known higher end chain restaurant recently. If you like a certain dessert made with cream cheese you probably know it. They always had a reputation for great food and great service. We had made a reservation, which was good, because when we arrived the lobby was packed even though it was very obvious half or more of the restaurant was empty. When I told the poor guy behind the host stand, we had a reservation he looked at me almost in panic and said, "I'm a server, they just stuck me here because they had no one and I don't know how to use the system". After we managed to get sat, which happened to be right behind the host stand, I could hear guest after guest berating this poor young man who was trying to do a job he had never been trained to do. When the server got there, and we ordered drinks my daughter ordered a flavored tea. The server commented "Oh, that comes from the bar" with a concerned look. We found out why when it took past the appetizer for her drink to arrive. You guessed it; the bar was short staffed as well. As I watched our server it was obvious that she was trying to handle way more tables than she should be to provide any type of service. When our food did finally arrive, it was very clear it had been sitting for some time. The response when asked why? Yep, short staffed and no runners. The experience was far from what we expected with this chain; however, it was very obvious that what staff there was, was doing their best to try to make it work. In spite of this, most guests didn't notice or didn't care. They continued to beat up on the staff because the experience wasn't up to their expectations.

If this is the new normal, why would anyone remain in a service position? Their tips are down because guests are unhappy, so they are making less money for doing more work while being yelled at constantly.

Some restaurants have gone with automation as a solution. In place of hosts or servers are self-service order kiosks and pickup counters where you get your own food. No more plates and glasses, but paper baskets and foam cups because no one wants to wash dishes either. The entire experience has changed. Instead of a nice smiling server greeting you and asking if you would like anything else, you interact with just machines and basically serve yourself. Is this the future of hospitality?

In order to survive this, hospitality businesses are going to need to reinvent themselves. For some, the automation route may be the way to go. I still believe there is also a desire for the human interaction. Especially in the more upscale venues and finer dining restaurants. But how do we do this without the same old staffing levels? How do we fill these positions in this new job market?

It can be done, but you first have to stop looking at things and measuring them the way you did before. Doing that is like moving from Florida to Michigan in the winter and wondering why your Florida clothes are not keeping you warm. Breaking old habits and processes, looking at things in a new way can be hard. Sometimes you simply cannot do it yourself. Sometimes you need a fresh set of eyes that isn't tied to a plan you created that worked well for the last 20 years. It's hard to let go of the past, and harder still to admit change is needed, however if you are going to thrive going forward you need a new and different approach. Don't be afraid to ask for other insights or opinions, be open to change. In fact, be the innovator, the one who drives change. Find new ways. Define how hospitality will be done in the future.

Carl Dittmaier

Director of Food and Beverage

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