National Post (National Edition)
WHERE HAVE ALL THE TEEN WORKERS GONE?
FAST FOOD DILEMMA
Ain New York quarter-century ago, there were 56 American teenagers in the labour force for every “limited service” restaurant — that is, the kind where you order at the counter.
Today, there are less than half as many, which is a reflection both of teenagers’ decreasing workforce participation and of the explosive growth in restaurants.
But in an industry in which cheap labour is an essential component in providing inexpensive food, a shortage of workers is changing the equation upon which fast-food places have long relied. This can be seen in rising wages, in a growth of incentives, and in the sometimes odd situations that business owners find themselves in.
This is why Jeffrey Kaplow, for example, spends a lot of time working behind the counter in his Subway restaurant in Manhattan. It’s not what he pictured himself doing, but he simply doesn’t have enough employees.
Kaplow has tried everything he can think of to find workers, placing Craigslist ads, asking other franchisees for referrals, seeking to hire people from Subways that have closed.
Yet there he was during a recent lunchtime rush, ringing up veggie footlongs and fountain drinks. He feared that if the line grew too long, people might get frustrated and not come back. “Every time there’s a huge line, the next day the store is nowhere near as busy,” he explained later as he straightened tables and swept up crumbs.
Keith Miller, another franchisee, is dealing with the same problem. “What employees? We don’t have them anymore,” joked Miller, who can’t find enough workers for the three Subways he owns in Northern California.
Since 2010, fast-food jobs have grown nearly twice as fast as employment overall, contributing to the economic recovery. But rapid growth has created new problems. Some say restaurants have grown faster than demand, causing a glut of competition that is another source of pressure on business owners.
U.S. restaurant owners are also worrying about increased immigration enforcement: Nearly one in five workers are foreign-born.
With unemployment at a 17-year low, businesses everywhere are struggling to find workers. Fast food is feeling the pinch acutely, especially as one important source of workers has dried up. In 2000, about 45 per cent of those between 16 and 19 had a job — today it’s 30 per cent.
“We used to get overwhelmed with the number of people wanting summer jobs,” Miller said, adding that he now gets maybe a handful of such applications, at most. “I don’t know what teenagers do all summer.”
Gavin Poole, a 17-year-old high school senior in New Jersey, likes the idea of being his own boss — that’s one reason he created a small business out of after-school landscaping and handyman work. The money has helped cover his cellphone bill and car lease payments. “I want to be prepared for the future, because you don’t know, financially, what situation you could be in,” he said.
A recent analysis by economists at the Bureau of Labor Statistics found that an increased emphasis on education — and getting scholarships — contributed to the decline in working teenagers, reflecting both the rising costs of education and the low wages most people that age can earn.
Now, after years of benefiting from low-cost labour, many employers are starting to pay more. Fast-food wages began rising in 2014, and have increased faster than overall wages since. But at US$10.93 an hour, the pay is still less than half the average for an hourly employee, pushing companies to offer more incentives — like dental insurance, sign-up bonuses and even travel reimbursement.
That’s good news for workers like Juan Morales, who has assembled sandwiches at a Subway on Staten Island, New York, for more than 15 years. “It’s much better than before,” said Morales, who earns a little more than US$15 an hour.
Restaurants are notorious for churning through employees. But people are coming and going faster than in recent memory, according to data from TDn2K, a restaurant research firm. Last year, the turnover rate reached 133 per cent, meaning that positions often had to be filled more than once.
Tamra Kennedy, who owns nine Taco John’s franchises in the Midwest, started offering US$100 as a bonus to new employees who reached 100 hours. She has started offering merit increases twice a year, and she pays all employees more than the minimum wage.
“Hiring has been more challenging in the last two years than probably the previous 10,” Kennedy said.