Elevated Wages Have Pushed Restaurants to Further Streamline Operations
The U.S. just added 263,000 jobs in November 2022, leaving an unchanged unemployment rate of 3.7% (Bartash, 2022). The combined effects of a tight labor market and high inflation have resulted in a sharp rise in wages, pushing the average hourly wage to $32.82. It becomes almost impossible for food service operators to keep up with the wage hikes. The good news is our food service providers have come up with several solutions to streamline operations.
Restaurants rolled out new store design plans
As an immediate response to consumer demands for contactless, self-services during the pandemic, many restaurants expanded their curbside pickup and delivery services. Panera Bread and Taco Bell, among others, quickly rolled out new and often smaller store designs with more drive-thru lanes, less seating, and more contactless digital service (Lucas, 2021). Modeling a ghost kitchen concept, Chipotle opened its Digital Kitchen back in 2020, only providing off-premises orders and food pickup (Park, 2020).
Finally, the biggest restaurant chain, McDonald’s, just opened a test restaurant in Fort Worth, Texas (McDonald’s, 2022). This new restaurant is smaller and designed for customers who are“on the move.” Some new features include:
- A separate“Order Ahead (drive-thru) Lane” with a food and beverage conveyor belt.
- A delivery pickup room for couriers, allowing for quicker and more convenient service.
- Designated parking spaces for curbside pickup customers and delivery drivers.
- Pickup shelf for dine-in orders.
While it is challenging to keep the soaring labor costs under control, restaurants find solutions through better use of technology. McDonald’s streamlines its new restaurant’s operations through enhanced location-based technology, app updates, the introduction of conveyor belts, and a new kitchen format. The goal is to provide a faster, better, and seamless experience for both consumers and crew.
With new store designs and enhanced technology, restaurants can improve productivity and rely less on labor. What other innovative ideas have you seen from the food service and restaurant industry to cope with the challenge of elevated wages?
Professor at The Collins College of Hospitality Management, Cal Poly Pomona
CAL Poly Pomona