Franchises Paying Workers Just To Interview Amid Worker Shortage Crisis

A worker shortage is causing restaurants to get creative in hiring as they struggle to find enough workers to meet growing demand. This shortage is impacting part-time and full-time positions as restaurants are fighting to hire kitchen, wait and front-of-house staff. As of March 2021, the U.S. restaurant industry was about 1.2 million workers down from March 2020.

Many restaurant owners are blaming government assistance programs for people’s lack of incentive to re-enter the workforce. In New York City, for example, individuals can collect up to $804 per week on unemployment ($300 in Federal Pandemic Unemployment Compensation and $504 in state benefits), which is about $20 an hour. In a state with a $15 per hour minimum wage, it makes it difficult for businesses to compete.

“It’s as bad as I’ve ever seen in my 17 years in New York,” Bernard Collin, partner in New York City’s Upper East Side’s Orsay, La Goulue and Bar Italia restaurants told the New York Post.

As a result, many restaurants are getting creative with incentivizing new applicants. Fazoli’s, a 200-unit Italian restaurant chain in the Midwest, increased its minimum pay by 8% to attract workers. Taco Bell is upping their benefits for general managers to 4 weeks of paid vacation and 8 weeks of paid maternity leave. A McDonald’s franchisee is offering $50 just to interview.

The worker shortage couldn’t come at a worse time for many operators as business is returning at a rapid pace due to stimulus checks, vaccines and loosening of regulations nationwide. 

Blake Casper, owner of the McDonald’s franchise location offering $50 interviews, told Business Insider, “It's a perfect storm right now. You've got a lot of people with a lot of money, and they're out there shopping. And then, on the flip side, we're scrambling for help." 

As the economy re-opens, restaurants nationwide are seeing an increase in demand, and demand for workers is increasing right along with it. Last week, McDonald’s held an event to hire 25,000 people in Texas alone. IHOP is looking to hire 10,000 people nationwide, and Taco Bell’s parent company Yum Brands is looking to hire 5,000 over the coming weeks.