Columbus restaurants need workers. Will the end of federal COVID unemployment fix it?
When Ross Horner set the opening date for his downtown, New York street food-style spot, he didn’t think he’d have trouble hiring employees.
Surely, he’d find his people to make the chili, work the fryer and cook those all-beef hotdogs. But as the days leading up to his grand opening dwindled, he got worried. Frank’s Alley did open earlier this year, but not without some challenges.
If workers didn’t show up for early shifts, Horner got behind the grill, making the day’s chili. He had other restaurateurs and managers from downtown establishments offer to take shifts to help out.
Horner isn’t alone. In Columbus, restaurants emerging from the worst of COVID-19 are facing a new issue: finding enough help to keep their doors open.
As the weather warms up, cases trend downward and vaccination rates increase, customers are pouring into restaurants.
The U.S. added 559,000 jobs in May, and the food industry sector continues to grow . Recently, more people have applied to work at Columbus-area restaurants, but not at pre-pandemic levels.
A group of restaurant owners and managers who spoke with the Ledger-Enquirer said they are having a hard time filling positions, partly due to federal COVID-19 unemployment benefits.
Workers who left the industry during the pandemic cite a variety of reasons for their departure. Some were tired of the stress and the treatment from owners and customers. Others found better job opportunities with better pay or benefits.
Georgia will end its participation in federal pandemic unemployment programs next week. Affected Columbus business owners hope this will help speed up the recovery. But has the COVID-19 pandemic changed the restaurant labor market permanently?
Is flexibility is key?
As COVID-19 took hold in the United States, the food service industry was acutely affected.
In February 2020, 12.3 million people were working in restaurants and bars on a seasonally adjusted basis. By April, that number had been halved to only 6.2 million.
In a survey of 6,000 restaurant operators and 250 supply chain businesses in November, the National Restaurant Association Research Group estimated that 87% of full-service restaurants saw an average 36% drop in sales revenue. More than 110,000 were completely closed on a temporary or permanent basis.
The industry had some growth in the following months, but eating and drinking establishments ended 2020 with nearly 2.5 million fewer jobs than before the pandemic, according to preliminary data from the Bureau of Labor Statistics.
Columbus restaurants were not immune.
Horner launched Frank’s Alley as summer 2021 approached. The goal was to provide something simple — a place where downtown workers and service industry folks with a spot to eat. It’s like running a really big food cart with a fun atmosphere. He didn’t want to “chef it up” too much, he said.
When looking to hire his first workers, Horner said he hoped to fill positions for jobs he didn’t want to do himself, dealing with grease and running the fryer.
He wasn’t able to pay $15 an hour, but he said he doesn’t think money is the driving factor in people’s lives right now. Nor are people just avoiding work. Increased unemployment benefits aren’t driving people’s decisions, he said.
It’s all about flexibility. Workers want to feel they have some autonomy, he said.
“I think you are no longer driving people by a set work schedule,” he said. “I think it’s a more collaborative effort with your employees. ... Flexibility is the number one thing that we hear people need for their lives to feel fulfilled.”
‘I see an uptick’
Michael Harrell, the owner and operator of 11th and Bay Southern Table, told the Ledger-Enquirer that he considers himself fortunate as a core group of employees got him through 2020.
Before the pandemic hit, 11th and Bay was open six days a week, and the staff included between 43 and 48 permanent employees. Now, he’s open only four days a week and employs around 26 staff members.
Harrell said he and his wife have talked about opening for additional days. But finding enough employees is holding them back.
Under former President Donald Trump’s CARES Act, eligible Americans received an extra $600 a week from the federal government in addition to their state benefits. Those benefits expired in July. A new stimulus package in December returned an extra $300 a week, and another in March extended the payments to early September 2021.
11th and Bay fully reopened mid-June 2020 and during the first five months, no one applied for a job.
“I (wasn’t) seeing the qualified, skilled labor that is out there,” Harrell said.
Lately, Harrell’s only been able to hire four employees. He said he’s paying “top dollar” after addressing his pay scale a year and a half ago. A majority of his staff makes $15 or more an hour.
He’s seen an uptick in applicants over the past few weeks as well. The day that Gov. Brian Kemp announced he was ending Georgia’s federal participation, Harrell got five applicants.
“I don’t know if it was a ‘let me get out there ahead of this’ kind of thing,” he said. “But up until that day, I honestly hadn’t received anything.”
Applications and the few recent hires were all for front-of-house staff. None are for the kitchen, meaning Harrell still won’t be able to open for additional days.
“I do see an uptick. I do see some activity. But most of it started after (Kemp) announced he was going to end the program.”
Why did workers leave?
Workers left the restaurant industry during the COVID-19 pandemic for a variety of reasons. Some who spoke to national news outlets cited abuse from customers over COVID-19 protections as grounds for their departure. Others found better jobs and simply took advantage of the opportunity.
Joshua Dunman left his job as a server during the pandemic after 14 years in the industry with most of that time spent in Columbus and Phenix City, including stints at Stock Market, Mabella’s and Epic.
Dunman, 37, was working at Stock Market when the pandemic first started. He went from making good money to no money “all of a sudden,” he said. Dine-in services stopped. Both of his parents are immunocompromised, so Dunman stayed out when dine-in services first returned.
He was already working at SpotOn, a software and payments solutions company aimed at helping small to mid-sized businesses, when he took a job as a server at Trevoli Rapids.
He wasn’t making a lot of money waiting tables, and Dunman said he was on the verge of a large sale. So, he left serving behind. But he’s still working with local restaurants as a SpotOn account executive.
“This has much much better potential and pays much better. And I got health benefits and a 401k. And I work with a really amazing company,” he said.
Dunman said the labor issues in the Columbus restaurant industry are influenced both by the federal COVID-19 unemployment boost and workers simply looking to making changes in their own lives.
“I know that right now that anybody that is willing to work, the restaurants are beginning to come back,” he said.
‘I would probably do the same’
It wasn’t too long ago when Country’s Barbecue co-owner Grif Morpeth had to pick up some shifts at the Mercury Drive location..
Like other places, staffing has been a problem. The local chain is continually hiring, and Morpeth said he’s looking for a few servers at all three locations for both shifts. For every 20 responses, he said he might get five employees, and they don’t always stay.
But things are getting better.
“I see a light at the end of the tunnel now,” he said.
Country’s has about 60% of the servers and 75% of the kitchen staff it did before the pandemic. A few of the folks he calls about returning aren’t interested in working at the restaurant again because it’s a stressful environment, he said.
“It’s making it harder to get orders out in time. Certainly in the dining room because we’re fully open,” he said. “I’m definitely glad to see them coming in and I want them to keep coming in, but yes, it’s definitely harder. It does cause some stress.”
In general, unemployment benefits play a factor in hiring difficulties. But there could be more at play in the broad labor market as some people look to make changes in their lives, he said.
Morpeth added his situation is likely due to the benefits. Pay raises haven’t been implemented at the restaurant, but it’s being considered.
“I’m (missing) all entry-level people. And, you know, if I was a freshman in college, and I was making that money from the government to stay at home, I would probably do the same so it’s hard for me to get mad at them. I think that’s a big part of it,” he said. “But I also think the labor market is just in disarray because everybody’s been on pause and everybody’s just taking this time to make changes.”
Will ending federal COVID-19 unemployment programs help?
Georgia will cut its federal pandemic unemployment next week. Gov. Brian Kemp and state labor commissioner Mark Butler said the goal was to “address workforce shortages and boost a full economic recovery.”
Once the state opts out of the programs, the maximum weekly benefit will be $365 and previous eligibility requirements will be reinstated.
“During truly unprecedented times, hardworking Georgians have stayed resilient and businesses of all sizes have quickly adapted to an unpredictable environment,” Kemp said in a statement. “As we emerge from this pandemic, Georgians deserve to get back to normal – and (the) announced economic recovery plan will help more employees and businesses across our state do so.”
Several economists, including Federal Reserve chair Jerome Powell and Treasury Secretary Janet Yellen have questioned that line of thinking.
Powell said in April it’s unclear if the benefits were keeping people from entering the labor market. Yellen said in a May White House press briefing that she didn’t think the extended benefits were the factor making the difference.
May’s jobs report, released earlier this month, was a mixed bag. It shows the U.S. added 559,000 jobs non-farm payroll jobs in May — short of the 671,000 jobs economists expected. Of those, 292,000 came from the leisure and hospitality sector. Nearly two-thirds (186,000) of the sector’s increase came from food services and drinking places.
Harrell at 11th and Bay said he is optimistic that things will improve this summer as the federal unemployment benefits end.
“We’ll find out. I mean you will know right away. If it goes away and I’m still not getting applicants — I don’t know what’s going on here,” he said. “If they lift it and people start coming out and start looking for jobs, it will certainly give me the option to open more days.”
For Morpeth, Kemp’s actions might solve his problems but not without some changes.
“I think the people that are looking for other opportunities, they’ll settle back into a groove, like it was before. The market will just get better and more stable, but I do think as a whole, this is going to cause labor pay increases for everybody,” Morpeth said.