The great Brexit chef shortage
Huge recruiting crisis sees plans for new restaurants shelved in...
BRITAIN’S restaurateurs are facing a recruitment crisis with higher costs, tougher competition and the effect of Brexit – and things are only going to get worse, say key industry figures.
Fears over workers’ rights following Britain’s exit from the European Union mean that restaurants are finding it harder to recruit staff and retain existing employees.
According to a recent survey by accountancy group KPMG for the British Hospitality Association, a quarter of all chefs are from the Continent. Ufi Ibrahim, chief executive of the BHA, said: ‘The success of the UK’s food scene depends on an ability to hire leading chefs from Europe and beyond. But we’re hearing that owners have been forced to delay or abandon plans to open new restaurants due to the uncertainty surrounding the future rights of EU citizens in the UK.
‘ This l evel of uncertainly is putting off skilled workers and is affecting investment decisions.’
The hospitality industry is already facing a staffing crisis. It needs to attract 200,000 new workers a year to replace natural churn.
Following the Brexit vote, it is estimated it will need an extra 60,000 each year, or risk facing a jobs shortfall of a million staff by 2029. When it comes to chefs working in Britain’s hotels, restaurants and cafes, the problem becomes even more pronounced.
There was already an acute problem for restaurants before the Brexit vote and we now face a predicted shortage of over 11,000 chefs by 2020, Ibrahim says. ‘This shortage isn’t limited to European chefs but also applies to highly skilled chefs from India and China.
‘Restaurants are being squeezed by immigration rules and while the industry is moving to encourage UK nationals to see the career opportunities available, we still need access to chefs who have the knowledge and understanding to teach the next generation.’
She added: ‘We’ve seen a worrying fall-off in the number of EU workers since the referendum and businesses are really beginning to feel the pinch.
‘EU workers have been leaving their jobs in hotels and restaurants and going back to their home countries, which is a huge concern. People are uncertain whether they’ll be allowed to stay in the UK and aren’t feeling very welcome here.’
The Bangladesh Caterers Association, which represents 12,000 restaurants, backed the Vote Leave campaign on assurances there would be more visas for South Asian chefs. Now it says it feels betrayed by the hurdles owners face in bringing in chefs from outside the EU and says many curry houses are at risk of closure.
Meanwhile hospitality firms from healthy fast food chain Leon to The Eden Hotel Collection have warned that difficulties hiring skilled staff from the EU could have a huge impact on their business. Last week food delivery company Just Eat added to the debate, saying that businesses in the takeaway sector, especially small firms, face a tough time due to skills shortages, particularly in kitchens producing curry, sushi and Chinese food.
Just Eat’s UK managing director, Graham Corfield, said: ‘ As with many industries, the takeaway sector faces a pending skills shortage. In a post-Brexit environment, restaurant owners tell us there are real fears they will be unable to hire the workers they need.
‘The great British curry crisis has been well reported, but the issue has the potential to affect small independent businesses offering all cuisines alike.’
Corfield called on the Government to review immigration rules for skilled workers, to improve skills and training within the industry and to fix the business rates issue to help smaller businesses.
Other factors are also affecting the industry adversely, said Andrew Green, director of operations at the Craft Guild of Chefs.
‘ When people realise the job involves long, anti-social hours, or that they have to spend years working their way up through the profession – unlike the overnight successes seen on MasterChef or The Great British Bake Off – and all for a low salary, then they often drop out of the industry,’ he said.
The solution, he said, was to improve training, engagement, salaries and hours, adding: ‘This is an issue of our own making and it’s time we did something about it.’
Chris Todd is chef recruitment manager at The Ned, one of London’s newest hotels and part of the Soho House group. He agrees with Green, saying: ‘The industry has a real problem with recruiting chefs, mainly because it doesn’t treat chefs well and hasn’t shown them a great deal of respect.’
A chef de partie – who oversees a section of the kitchen – would usually have four years’ experience and be paid £23,000 a year, he said.
Often they would be expected to work a 60 to 70- hour week, he added, explaining: ‘A lot of places don’t even pay overtime so you’re working many hours for free.’
Todd recently hired 161 chefs for The Ned’s nine restaurants, thanks to a recruitment drive around the UK and in Italy and Spain.
The chefs are on a training programme and get perks such as two weeks’ discounted stay at the hotel when they arrive, a hotel discount card and a trip to its rooftop pool.
‘It’ s all about keeping them engaged and positive about their job,’ says Todd. ‘We want to keep the staff we have.’
MARK Selby is the business brains behind Wahaca, one of the UK’s most successful restaurant chains. But he had to bring the Mexicanthemed brand back from the brink last year after norovirus struck.
In comparison, even soaring business rates seemed small beer, as during November’s outbreak the 39year-old feared the business he had given birth to could go bust. ‘Our world was falling apart,’ he says.
‘We got a call on the Thursday night saying we’d closed Manchester because ten members of staff got sick. I thought it weird, but we got a team to do a deep clean.
‘The next day, in Covent Garden, ten team members called in sick, and we had to close that too. Over the next 48 hours site after site kept falling. Then, on Sunday morning, customers started emailing in. That’s when all hell broke loose.’
Selby had to call in Public Health England and it seems likely that the outbreak originated with a supplier, though the agency’s report will be released only later this summer.
‘At one stage we thought we were going to have to close every restaurant for four weeks,’ says Selby. ‘During that time sales plummeted 45 per cent, but if I’d had to close all sites, I don’t see how we would have survived.’
In all 18 of the 25 restaurants were hit and he had to close 11. The experience changed the way he does business.
He says: ‘We’ve had to make some tough calls with our suppliers. We’ve had to say, we have to have absolute visibility or we can’t work with you.’
At 18, Selby knew he wanted to own and run a theatre or restaurant. Lovers of Mexican food will be grateful he chose the latter.
He got together with Thomasina Miers, the 2005 winner of the BBC’s MasterChef series, and together they opened the first Wahaca in Covent Garden in 2007. But where did he get the name from?
‘ I’d been travelling in Mexico when I was 18, and got my A-level results standing in the main square of Oaxaca,’ he explains. No one in the UK would know how to pronounce that, so it became Wahaca.
Though many openings followed the launch, he has never experienced inflationary pressures like now. And not just from Brexit and sterling’s weakness. It’s largely down to Government policies. ‘Business rates on our Covent Garden site have gone from £85,000 a year to about £260,000,’ he says, and it’s not just London.
‘We are in Cardiff, Manchester, Chichester, Edinburgh, Liverpool, Dart ford, Southampton and Brighton, and not one of them has seen rates decrease.
‘Across all our sites, we reckon business rates will have gone up 40 per cent by 2020, and some are jumping 25 to 30 per cent straight away. In Central London it’s crazy.’
In total, Wahaca will pay an extra £700,000 in rates this year alone.
‘The Government doesn’t realise how many businesses it’s killing around the UK. It’s hideous. We will get through it, but it’s made us look at our expansion plans and it makes some sites less viable.’
The new National Living Wage is driving up costs too. The wage bill will rise 4 to 5 per cent this year.
Selby also faces big rent rises. He says: ‘ We’ve had two rent reviews recently, one raisi ng t he rent in Covent Garden from £140,000 to £ 400,000 a year, the other in Soho, raising i t from £400,000 to £1 million a year, which we are still disputing. ‘There is huge cost pressure. It’s unprecedented. We are looking at a cost increase this year of £1 million to £1.5 million on turnover of £45 million. That is a big hit.’
The question is whether he will pass it on to consumers.
‘We are going to have to put prices up a couple of a per cent,’ he says. But prices would have to rise 10 per cent to offset the cost increases, which Selby thinks too high for the consumer. So Wahaca ‘will take a hit on profit’.
Another worry is immigration post-Brexit. Only a quarter of his 1,200 staff are British. He says: ‘We recently opened in Chichester and found it really hard to find staff to work there, even in management.’
So where is he going to find staff once the UK leaves the European Union? He says: ‘I have no idea. The entire industry will be hit.’
At least Selby is used to crises, having launched Wahaca at the start of the financial crisis when consumers faced their worst squeeze in income since the Great Depression. Yet Wahaca has thrived as well as some of the 7 million chill i seeds it has given to customers to plant after each meal. Another three or four restaurants will open this year.
Selby spent the first two years of his career at US investment bank Merrill Lynch, learning to model how businesses works. He went on to work for easyJet founder Stelios Haji-Ioannou on business development and projects such as easyGym and easyHotel.
He learnt the restaurant trade from the founders of Nando’s, Robert Brozin and Fernando Duarte. They must have liked him because when he set up Wahaca, they took a stake and funded his plan, as did Adam and Sam Kaye, the brothers who set up Ask and Zizzi.
Selby thinks the market for Mexican food is just getting going. He says: ‘When we started ten years ago there was no good Mexican food. People went to Mexican restaurants to slam Tequila, drink Margaritas and get drunk.
‘But Mexico has an immense history and culture of food – cocoa, chillies, tomatoes, vanilla, squash and avocados are all indigenous to Mexico. It is the third most biodiverse country in the world when it comes to food. The Mexicans were cooking with tomatoes before the Italians. Yet no one knew about it. ‘In ten years, we want tacos to be as popular as pizza or burgers.’
Selby’s favourite dish is t he pork pibil taco, Wahaca’s best- sell i ng dish with 1 million sold last year. As the business brains, he couldn’ t explain how to cook it, though he eats at W aha ca‘ pretty much every day’. Though the father-of-three spurns Tex-Mex drinking holes, he says he is ‘very evangelical about tequila’, adding: ‘If people come for dinner, I get them to try my 40 tequilas at home. Good tequila is amazing.’
If you go to the opening of a Wahaca you are likely to see Selby handing out glasses of the drink. Perhaps it is the shot he and the restaurant need in troubled times.
The Government doesn’t realise how many businesses it’s killing around the UK. It’s hideous