The National Restaurant Association calculates that 515,000 people will find summer jobs in the restaurant industry this year, down from 542,000 in 2018. If this comes to pass, it will mark the seventh consecutive year the industry will add more than half a million people for the summer travel period. The association attributes the decline to operators trying to control labor costs. Employees’ wages are higher due to increases in minimum wages and an extremely tight labor market.
The states projected to hire the most seasonal workers are New York, California, Massachusetts, Texas, New Jersey, Illinois, Ohio, Michigan, Maryland and North Carolina. Those states that will have the largest proportional employment increase are Maine, Alaska, Delaware and Rhode Island.
Two major tourist states — Florida and Arizona — do not increase hiring because they are not summer destinations.
Many of those hired this summer will be students and their foodservice jobs will allow them to continue to pursue their educations. But its advantageous to the restaurant industry as well as that many of the summer employees will go on to pursue careers in foodservice.
Economic News This Week
- U.S. job openings increased to 7.5 million in March, according to the Burau of Labor Statistics JOLT study. There are 1.2 million more job openings than people looking for jobs, according to Labor Department calculations. Other aspects of the labor market were little changed from February. The number of hires was 5.7 million. Total Separations stood at 5.4 million. Employees voluntarily leaving their jobs (“Quits”) numbered 3.4 million. Layoffs and Discharges accounted for 1.7 million separations. “Other” Separations accounted for the rest of the separations.
- Initial-jobless claims totaled 211,000, a decline of 1,000 for the week ending May 18. The 4-week moving average was 220,250, a decline of 4,750. This measurement of the job market shows employment continues to chug right along.
- April existing home sales fell 0.4 percent from March to a seasonally adjusted annual rate of 5.19 million. A spokesman for the National Association of Realtors called the drop a “minor decline” and said he expects sales to return to moderate growth soon.
- April sales of new single family homes were estimated at 673,000 on a seasonally adjusted annual basis by the Census Bureau and the Department of Housing & Urban Development. This is down 6.9 percent from March but an increase of 7.0 percent over sales in April 2018.
Foodservice News This Week
- Restaurant chains speed up payday to attract workers. Starting in June, Church’s Chicken will offer to pay employees 50 percent of their wages the same day or next day. The test is to see if expedited pay will attract and hold workers. It is not a loan and there are no fees. Pizza Hut and Checkers are trying similar programs.
- Chick-fil-A enters a tech-obsessed era. Almost 20 percent of the chicken chain’s sales come from digital sources, per the chain’s execs. This is up from 6.0 percent at the beginning of 2018 and 16 percent at the beginning of this year. The digital growth has been driven by a revamped app and a new loyalty program. Chick-fil-A executives see not only mobile ordering and payment as important but options like delivery, food trucks and some kitchens devoted strictly to takeout and delivery orders as coming on strong.
- British sandwich and coffee shop chain Pret A Manger acquired EAT, another chain. Looking to harvest some green from the thriving plant-based food movement, Pret A Manger plans to convert most of the EAT shops into Veggie Prets stores to cater to more health-conscious food enthusiasts who prefer plant-based meals over meat, per a Reuters report.
- Team Schostak Family Restaurants purchased 56 Wendy’s restaurants in Michigan. Livonia-based TSFR owns and operates 65 Applebee’s, 27 Olga’s Kitchen, 14 MOD Pizza and 7 Del Taco restaurants. All are in Michigan.
- Corporate Stirrings: Montreal-based MTY Food Group completed its acquisition of Papa Murphy’s Holdings Inc. Papa Murphy’s stockholders will receive US$6.45 per share. Two former CEOs of Kona Grill have joined together to bid on the bankrupt chain.
- Growth Chains: Taco Bell has signed a master franchise agreement with their Indian franchisee to open 600 restaurants in the next 10 years. MOD Pizza plans to open more than 500 locations in the next 5 years, which will more than double the chain’s current size. I Heart Mac Cheese will open 4 stores in Texas with expectations of adding 20 more. Mountain Mike’s Pizza has opened three locations in California with two more set to open this summer. Captain D’s franchisee Goalz Restaurant Group opened two restaurants so far this year with two more in the pipeline. Burgerim plans to open 26 restaurants in the California Bay Area.
- Comparable Store Sales Reports: Carrols Restaurant Group up 2.4 percent, Famous Dave’s (Company-owned stores up 1.3 percent and franchised stores flat), Freshii Inc. down 0.7 percent and Steak ‘n Shake down 7.9 percent.
For details and same-store sales of other chains, read the latest Green Sheet.