MAY 24 When the Centers for Disease Control opened the floodgates May 13 to vaccinated Americans getting out and congregating, many who had ordered out or cooked at home for 14 long, lonely months heaved a sigh of relief. Then they dialed up their favorite restaurant to make a celebratory reservation. Restaurant owners are more […]
Already a subscriber? Log in
Want to Read More?
Get immediate, unlimited access to all subscriber content and much more.
Learn more in our subscriber FAQ.
- Unparalleled business coverage of the Iowa City / Cedar Rapids corridor.
- Immediate access to subscriber-only content on our website.
- 26 issues per year delivered digitally, in print or both.
- Support locally owned and operated journalism.
MAY 24
When the Centers for Disease Control opened the floodgates May 13 to vaccinated Americans getting out and congregating, many who had ordered out or cooked at home for 14 long, lonely months heaved a sigh of relief. Then they dialed up their favorite restaurant to make a celebratory reservation.
Restaurant owners are more than anxious to welcome them back. The catch is, they can’t — at least not easily.
After suffering through a year marked by closures, layoffs, and a shift to mostly take-out and delivery, operators are now facing a historic shortage of workers that has forced them to limit hours, reduce seating capacity, eliminate lunch and breakfast service, and load up existing staff with more hours and duties.
“With the CDC guidelines changing, the weather getting nicer, and more people vaccinated, I think people are ready to come back out and enjoy restaurants like ours,” said Tim Carty, a co-owner of North Liberty’s Table restaurant, which has seen its fair share of challenges since opening in the thick of the pandemic in July 2020. After only being open five months, the eatery specializing in modern American classics and craft cocktails closed just before Thanksgiving as the weather cooled and COVID-19 cases spiked.
Table reopened March 23 but has wrestled with finding enough staff ever since. For the moment, the restaurant is only open for dinner and has put off plans to open for lunch or relaunch a revamped brunch service it had been excited about premiering.
“We’re really struggling,” Mr. Carty said. “I mean, you can’t drive past a restaurant in town without seeing ‘now hiring’ or ‘help wanted’ signs or something in their window. And we’re definitely part of that group … The smaller staff that we have is wonderful, but they’re working every hour we’re open, which isn’t good for anybody. We’re just running them ragged and that’s not fair.”
Things are tough all over, as a glance at Indeed.com confirms. The job-hunting site listed 7,777 job availabilities in the Cedar Rapids metro and 4,521 in the Iowa City area as of mid-May. Employers like Menards are offering an extra $4 an hour on top of the company’s base wage at all locations, and many are advertising eye-popping new benefits and bonuses. CCB Packaging in Hiawatha, for example, is offering a $1,000 sign-on bonus for automated associates and flexible scheduling that allows them to work just seven out of every 14 days.
But according to Iowa State University economist and research scientist Dave Swenson, no sectors of the economy are suffering from workforce shortages more than the ones that have borne the disproportionate brunt all along — leisure and hospitality. Those employers were forced to lay off most of their workers early in the pandemic, only to struggle mightily to lure them back.
“Leisure and hospitality are the lowest paying sectors of our economy,” Mr. Swenson said. “They pay the worst wages, they generally have the worst working conditions with regard to employment security, benefits [and] down the line. Those jobs were absolutely hit the hardest.”
The fallout is easy to see. Restaurants across the region and the country are festooned with “Help Wanted” signs and running ads touting improved wages and signing bonuses. Pizza Hut is offering shift managers in Iowa City $1,000 sign-on and retention bonuses, Tin Roof in North Liberty is advertising $200 bonuses to new line cooks and kitchen staff, and Cedar Rapids’ Granite City is supplementing wages of $14-$18 an hour with $300 bonuses for kitchen staff.
In the meantime, restaurants are having to make do with less, which often means restricting hours and capacity — a bitter pill to swallow just as Americans get the official nod from health officials that it is finally safe for the vaccinated to mix and mingle in groups. Several area restaurants have closed their doors at least one day a week to give their staff a break or cut out breakfasts, lunches, or both.
While Table is open for dinner only, Jake Kendall, who owns and operates Culver’s locations in Cedar Rapids, Hiawatha, Marion and Waterloo, recently switched to a drive-thru-only model due to an inability to hire enough staff.
“As painful as it is to admit, that is the operational model we’re currently in,” Mr. Kendall said. “It’s working for us, we’re lucky to have that option, but it doesn’t make it any easier, by any means, to turn away business that you spent years trying to build.”
Restaurant operators were wary of wading into the political waters of Gov. Kim Reynolds’ decision to put an end to federal enhanced unemployment benefits, although most said just about anything will help at this point. Pro-business groups, however, lauded Ms. Reynolds’ decision to end the extra $300 a week benefit early. The benefits, set to expire in September, ended June 12.
“Federal pandemic-related unemployment benefit programs initially provided displaced Iowans with crucial assistance when the pandemic began,” Ms. Reynolds said. “But now that our businesses and schools have reopened, these payments are discouraging people from returning to work.”
Jessica Dunker, president and CEO of the Iowa Restaurant Association, said the restaurant industry overwhelmingly believes supplemental federal benefits have played a major role in the worker shortage. A survey conducted by the association found that 90% of Iowa restaurant owners believe enhanced unemployment helped dry up supply. Forty percent say former workers took jobs in other industries, 20% said they believed workers were fearful about returning to work in a restaurant setting and 15% cited employee school and child care issues.
“It’s not really true that they make more money staying home, but they maybe make enough to get by,” Ms. Dunker said. “Some people were opting to sit out the summer. Maybe it gave them the opportunity to get their kids through the school year and the summer. There are a lot of reasons, and it has really very little to do with people not wanting to work. There’s no judgment from a standpoint of work, it’s that they’re just weighing decisions, and if you can make enough, you might do without some things because you have the opportunity to be home a little bit longer. That’s one piece of it.”
“We became the tip of the spear from the standpoint of strategies for mitigation of COVID,” she added. “Our industry was the first one they took down and our workers, many of whom had careers in our industry, looked around and said, ‘You know, I can get the same amount of money and I can do one of those work-at- home jobs like customer service or great phone jobs.’ We were kind of easy pickings for other industries that were a little more pandemic proof [in terms of] stability of work. We’ve lost people to other careers, and now we’re in the unenviable position of having to go out and redevelop a lot of our workforce … And, you know, I just don’t know that we’ll get those people back or what the solution is.”
NEWSMAKERS UPDATE
Retention the best solution to workforce troubles
The struggle to find a qualified workforce is not subsiding any time soon.
According to a report by MetLife and the U.S. Chamber of Commerce, optimism around hiring is muted. 44% of business owners say it is hard to find qualified job candidates to fill open positions and 56% believe the small business climate will not return to normal for at least six months.
“It depends business by business,” said Nancy Bird, executive director of the Iowa City Downtown District. “There’s definitely been some adjustments that each business has had to go through.”
She stressed that the best way for businesses to avoid a workforce crisis is by focusing on retention and reducing burnout.
“I know that some restaurants have changed their models a little bit so that, for example, they don’t have one person doing dishes all the time,” she said. “Trying to share the hard parts of the job, while also lifting people up and trying to encourage them to keep them excited.”
“The other key piece of retention is paying people more, and you’re seeing that hourly rate go up significantly from what it was two years ago,” Ms. Bird added.
— Noah Tong
