UCD Data Digest: Examining Worker Shortages in the Hospitality Industry

Over the past year and a half, there has been no shortage of coverage on the challenges facing the hospitality industry. In recent months, that focus has shifted away from the impacts of pandemic-induced lockdowns and onto worker and supply chain shortages. Restaurants, to meet renewed demand from diners, have rapidly increased the rate of hiring, and in many cases raised wages and offered better benefits to attract staff. However, it appears that not all workers are rushing back, and some who are aren’t staying for long.

During the worst months of 2020, the restaurant industry essentially shut down in Philadelphia. Some restaurants were able to pivot to a take-out-only model, but dining rooms remained almost completely empty. After the initial wave of the virus began to wane, things picked up but only slightly. It wasn’t until the spring of 2021 – a full year after the beginning of the pandemic – that the hospitality industry began to post new jobs in numbers comparable to pre-pandemic levels.

However, simply hiring at the same rate as pre-COVID does little to make up for the gap in employment in the sector. At the height of the pandemic, nearly 40% of workers in the sector were separating from their jobs, and total employment in Philadelphia’s hospitality industry dropped from nearly 75,000 workers to as low as 30,000. During the following year, reports have shown that many hospitality workers used their time to explore new careers in other industries, while others felt the risks associated with working in high-contact jobs were too high to return. Even with nearly all restrictions outside of masking lifted in Philadelphia, the hospitality industry in the city is operating with only about 65% of its pre-pandemic staff. And, even if all the available job openings were filled, staffing levels would reach just under 60,000 workers, well below the 75,000 from February 2020.

According to the Burning Glass salary model, the median salary for restaurants in Philadelphia is around $25,220/year, which works out to just over $12/hour. Anecdotally, many corporate establishments are offering $15/hour, but it’s one of the harder industries to get wage data on since 1) tips are not factored into the wage data and 2) many smaller establishments recruit by word of mouth or through signs in the window as opposed to websites Burning Glass can scrape.

In short, one of the hardest-hit sectors of Philadelphia’s economy still has ground to make up for as it recovers from the shocks of the past 18 months and a recent report from Jobslist suggests that the shortage of restaurant workers may get worse before it gets better. What that means for the industry at large remains unclear, but here at University City District, we are working with local restaurant partners on a West Philly Restaurant Job Fair to help connect people seeking restaurant positions with local restaurants seeking staff. We're lending the expertise of our West Philadelphia Skills Initiative to provide insights to restaurant partners and to applicants seeking to find employment. 

Interested candidates can apply for open positions at participating restaurants using a common application. Restaurants will then welcome candidates for in-person interviews on Wednesday, November 17th, with the option to offer on-the-spot jobs. To sweeten the deal for jobseekers, UCD is funding $100 signing bonuses to the first 50 people hired by participating restaurants who complete five shifts.