Survey: 9 in 10 Michigan restaurants, hotels face staffing shortages

Restaurants struggle to meet consumer demands after pandemic restrictions lifted

Help wanted sign (Pixlr)

Have you been to one of your favorite restaurants lately and noticed a burned-out, understaffed group of workers? They’re not alone.

Help is wanted. No, help is needed.

Understaffed Michigan restaurants, bars, hotels

The Michigan Restaurant and Lodging Association (MRLA) released survey results Aug. 11 showing 88 percent of hospitality industry respondents are operating with “inadequate staffing to meet consumer demand.”

MRLA said it conducted the survey Aug. 3-6. It included 320 responses from Michigan restaurant and hotel operators representing about 1,000 locations statewide. MRLA said its members and non-members both were presented the opportunity to complete the survey.

Inadequate staffing was reported by:

  • 100 percent of banquet facilities
  • 97 percent of hotels
  • 89 percent of full-service restaurants
  • 81 percent of quick service restaurants
  • 67 percent of bars/nightclubs

A curfew on Michigan bars and restaurants was lifted June 1. All bars and restaurants had been required to stop offering indoor dining by 11 p.m. The Michigan Department of Health and Human Services initially implemented a 10 p.m. curfew in November.

Restaurant staffing issues have been prevalent throughout the COVID-19 pandemic. Now, more than a month after those restrictions were lifted, the industry continues to face severe staffing issues and inflation of commodities while COVID-19 variants spread in the state that is struggling to get more people vaccinated.

“While Michiganians have proven eager to return to a life that includes ample travel and restaurant dining, it has become clear that the nature and speed of this return has placed enormous pressure on the industry and its supply chain,” said MRLA President and CEO Justin Winslow. “Restaurant and hotel operators are trying to meet consumer demand that exceeds 2019 with 100,000 fewer workers and skyrocketing labor and commodity prices. Workers are exhausted and profit margins are thin for many despite the resurgent demand.”

According to the MRLA survey results, more than four out of five respondents are operating at least 10 percent below adequate staffing levels and 29 percent in the industry are operating more than 30 percent below what is needed to meet consumer demand.

Key results from the survey:

  • Nearly 80 percent of restaurant and hotel operators reported closing early or for specific segments during the day as a direct result of inadequate staffing levels. For full-service restaurants that figure exceeds 85 percent.
  • 81 percent of hotels are limiting room inventory because they do not have adequate staffing to turn them over for new guests.
  • 95 percent of restaurant and hotel respondents have increased wages in 2021 with half increasing wages by more than 10 percent this year. More than 70 percent have increased schedule flexibility to appeal to prospective employees, while half have offered financial incentives.
  • 97 percent reported inflation of commodities this year, with half reporting price increases greater than 10 percent.
  • 28 percent support recent CDC guidelines recommending masks indoors because it will “create a safer and more stable environment in which to operate” while 72 percent opposed because it will “reignite an environment of fear that will negatively impact my business.”
  • 73 percent of respondents would oppose a New York City-style mandate requiring proof of COVID-19 vaccination to enter most indoor establishments including restaurants and hotels.
  • 64 percent of respondents believe Congress should enact additional targeted relief for the hospitality industry.

$15 wage becoming norm nationally

This is far from a Michigan problem, and it’s not necessarily unique to the restaurant industry. With the current shortage in labor, businesses across many industries are trying to bring workers in with wages that start at $15-17 per hour, with added bonuses and perks.

Nationally, restaurants, hotels, retailers and more have started offering a $15 wage to try to fill enough jobs to meet surging demand from consumers. That’s far from the federal minimum wage of $7.25 ($9.65 in Michigan) that hasn’t been raised since 2009. Staffing companies say $15 an hour is the level that many businesses must pay to fill their jobs.

Donald Grimes, a University of Michigan economics researcher, said people should find a job now instead of waiting for something better to come along in the fall. Workers have strong bargaining power now and should be able to find something attractive.