The New Era of Workforce Management: Navigating Labor Shortages in the Hospitality Industry

It is no secret that the hospitality industry has been facing an incredibly difficult challenge over the past few years: an ongoing labor shortage that has left business owners and hiring managers grappling with the dual pressures of attracting and retaining quality employees. This issue has become a persistent concern, demanding innovative solutions to ensure businesses can thrive in this new era of workforce management. That is why technology and tools designed to streamline hiring, onboarding and employee engagement are now more critical than ever.

The Labor Shortage and Its Impact

The labor shortage in the hospitality industry is not a new phenomenon, but its impacts have been significantly amplified in recent years. According to the Black Box Intelligence webinar on the 2023 State of the Restaurant Workforce, only 33% of restaurants are fully staffed right now. Nearly nine in 10 operators say recruiting and retaining employees is a significant or moderate challenge for their restaurants, according to the NRA's 2024 State of the Industry Report. 

Additionally, about one-third of existing hospitality workers are at risk of leaving the industry within the next two years, according to a study by Toast. The industry’s notably high turnover rate is a substantial burden on operational efficiency and profitability, as constant hiring and training cycles consume valuable resources.

So, what are some of the reasons behind this labor crisis? The top complaints driving turnover include poor management, low pay, lack of recognition and unfavorable schedules. A survey by Harri and CGA shows that the factors employees care most about include: wanting to be good at the job (59%) salary and benefits (45%), flexibility (45%), good management (42%) and general care (29%). 

The bottom line — with such a large supply of jobs in hospitality, employers that don’t consider these factors risk losing staff to competitors. 

The Role of Technology in Addressing Workforce Challenges

As business owners and managers navigate these labor challenges, the need for robust technological solutions becomes evident. Platforms like Harri have emerged as pivotal tools in transforming the way hospitality businesses manage their workforce. Harri offers an integrated, full-circle human capital management system tailored specifically for the hospitality industry.

These types of platforms can simplify the hiring process by matching the right talent with the right job roles, reducing the time and effort required to fill positions. It can also ensure new hires are onboarded effectively, with clear guidelines and automated compliance checks that reduce the risk of errors. 

According to the survey by CGA & Harri, well over a third of employees thought their onboarding process was either too basic (28%) or too long (13%), and only 29% said they were very satisfied with it. In both training and onboarding, this points to the need to optimize onboarding and training processes — strategies in which technology has a major role to play.

Once employees are on the team, there are an abundance of engagement tools that can provide managers with insights into satisfaction and performance, enabling proactive measures to enhance retention. Only 31% of employees report they are engaged, enthusiastic and energized by their work, according to a June 2023 Gartner survey of nearly 3,500 employees.

Advanced scheduling features can also allow for efficient management of shifts, helping employees balance work with personal commitments. According to a Lighthouse Research & Advisory Report, “when I work” is their number one priority frontline workers consider when it comes to workplace flexibility, and a critical enabler of that is mobile access to schedules and shifts.

“It’s not a matter of answering, ‘How are we going to manage our hiring and our people operations?’ anymore,” said Kevin Gancarz, director of operations for MPSquared Subs. “It’s now about being able to focus on identifying the right people, training them correctly, marketing the business and doing the things that will help us drive more revenue.”

Strategies for Managers and Leaders

For hospitality managers and leaders, the key to navigating this new era lies in leveraging technology to create a more attractive and supportive work environment. Here are some strategies:

1. Invest in Employee Development: Providing opportunities for professional growth and development helps in retaining employees and keeping them engaged.
2. Foster a Positive Workplace Culture: Recognizing and rewarding employees' contributions can significantly enhance job satisfaction.
3. Utilize Data-Driven Insights: Tools like Harri Engage can help managers understand employee sentiments and address issues proactively.
4. Streamline Administrative Tasks: Automating compliance and scheduling processes frees up managers to focus on employee interaction and customer service.

“Keeping things organized with candidates and employees is huge,” said Jersey Mike’s franchisee Josh Barton. “Eliminating the paper applications, the payroll process, the timekeeping aspect, the pay datasheets — for me, Harri shaved off a ton of time operationally. Everything just gets streamlined and efficient through Harri. It centralizes and consolidates all of the processes into one platform so I don’t have to jump around to a variety of different tools. Harri brings order to a lot of stuff, which opens up time for me to focus more on growing the business. It’s made my job more efficient.”

Looking Ahead

The hospitality industry is timeless — 63% of U.S. adults have worked in the restaurant industry at some point in their life, according to NRA. It is the nation’s training ground. But that doesn’t mean it's immune to the evolving dynamics of the modern workforce. The labor challenges that hospitality faces today demand innovative and comprehensive solutions to maintain its core values while adapting to contemporary needs.

Platforms like Harri are at the forefront of this transformation, offering tools that not only simplify hiring and onboarding but also enhance employee engagement and retention. In an industry where human interaction is paramount, ensuring that employees are happy and engaged is crucial. By combining that human-focused approach with innovative technology, hospitality businesses can foster a work environment where employees feel valued and supported. This, in turn, leads to better service quality, higher guest satisfaction and improved performance.

As the industry continues to evolve, adopting such technologies is not merely a response to current labor shortages — it is an investment in the future resilience and efficiency of the workforce. 

For more information on how Harri can transform your workforce management, visit: https://harri.com/.