labour crisis

Is tech the key to solving the restaurant labour crisis?

By Laurent May

Overall, the state of Canada’s labour market is looking good, which points to an economy on the rebound from the worst impacts of the COVID-19 pandemic. In September, according to recent figures from Statistics Canada, employment reached pre-pandemic levels for the first time.

This is great news in general, but a closer look reveals that the good fortune isn’t distributed evenly across every industry. In fact, employment in accommodation and food services actually fell in September, to almost 15 per cent below pre-COVID levels.

While the reasons behind that labour crisis are many and varied — some of them predating COVID-19 — its existence is a fact that restaurant operators must wrestle with. The ones who stay agile and embrace next-generation technology will be in the best position to adapt to this new reality.

The customer’s experience should not have to suffer as a result of reduced staffing, nor should the employees who are in place have to bear an extra burden because of smaller crew sizes. Fortunately, with the right technology in place, establishments can address both of these issues simultaneously.

Transforming traditional touchpoints

Many restaurants have already implemented contactless technology, largely as a response to the unprecedented public health and safety threat of COVID-19. The widespread adoption of QR code digital menus, self-ordering, and self-payment options accessed via smartphones quickly transformed many of the traditional touchpoints in the dining experience.

Consider the experience of one of our customers and early adopters, a premium dining chain that operates 68 locations across North America, which, during the pandemic, implemented adaptive digital menus as well as pay-at-table and order-to-go technologies. The chain increased its average order value by $13 — without compromising the guest experience.

In fact, many guests find that contactless tech actually elevates their dining experience. For them, this is the new normal, and they love the convenience of it. People appreciate having options when it comes to ordering and paying — whether that’s directly through servers or by using their own phones or a restaurant’s built-in tablets.

Allowing self-payment with contactless tech can benefit customers and restaurants alike. In the case of one of our partners, a casual-dining restaurant chain, introducing a pay-at-table solution shaved an average of 16 minutes off table turn times, keeping the restaurant at an optimized capacity during peak times without the need to increase service staff during a labour crisis.

Bringing reluctant workers back

This is not to suggest that human servers will ever be fully replaced by technology, or that diners would ever want them to be. As much as they expect convenience, people still crave a human element. Just as digital transformation has changed the guest experience, it also has the power to elevate the role of the server into one that may be more appealing to job-seekers.

With customers essentially co-piloting things like ordering and paying, servers can focus less on logistics and more on touchpoints that are truly meaningful, like understanding diners’ needs and building relationships with them. In a sense, they can become brand ambassadors, and that can mean higher sales and bigger tips.

Consider the experience of our client, a casual dining Italian restaurant that re-engineered the entire service flow at all its locations to fully take advantage of a digital-first approach. Pay-at-table transactions consistently receive 20+ per cent higher tips than traditional payments, which is a great incentive for staff.

Many former hospitality workers cite low pay as a major reason they have no desire to return to their old jobs. Faced with the current labour crisis, some restaurants have resorted to luring workers in with promises of signing bonuses and other perks. With fewer front-of-house staff members and the potential for boosted sales, restaurants that adopt customer-facing tech will likely be able to offer higher base salaries, which will serve to increase employee engagement, and might bring some reluctant former workers back to the industry.

A significant gap

And restaurant workers are desperately needed right now. According to a Restaurants Canada survey of restaurant owners, 80 per cent of respondents said they were finding it difficult to hire back-of-house staff and 67 per cent were having trouble filling front-of-house positions.

While those jobs go unfilled and the labour crisis goes on, however, diners are keen on filling seats at restaurant tables. A separate Restaurants Canada report says that 89 per cent of Canadians are looking forward to eating out with friends and family, with 64 per cent saying that dining out will be an important part of their lifestyle post-pandemic.

There is clearly a significant gap there and remedying it will be a complex challenge. Technology is not the whole answer, but it can certainly help by freeing staff up from some of their more traditionally mundane tasks and allowing them to focus on customer service. Because it ultimately reduces the cost of hiring, training, and retaining staff, creating a more engaging and rewarding work environment for employees also pays off for employers and strengthens the industry as it faces this unprecedented challenge.

In the current climate of labour shortages, it’s clear that contactless technology can help restaurants combat at least some of the challenges they are facing — and it may even play a part in helping them survive.

Laurent May is the CEO of Ready, a fully integrated mobile self-ordering, payment and loyalty technology solution that’s defining the next generation of hospitality venues. He has over 20 years of product management expertise in the electronic payments space leading high-performance teams.