Restaurant Turnover Rate: Why It Happens & How to Reduce It

Turnover in restaurants is as high as ever. Labor shortages, health crises, and general economic trends have made it a struggle — and restaurants need help.

But we’re at an inflection point in the restaurant industry. It’s not enough to just pay more than the restaurant next door. The restaurants that prioritize employee retention above all will come out on top. The restaurants that are able to keep employees around treat the employee experience with as much regard as the customer experience, if not more. They offer work-life balance, flexible schedules, useful benefits, and operate on strong core values.

But before we dive in, let’s look at where turnover stands right now—and what’s causing it.

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Restaurant Retention & Turnover Data Study

Turnover in the restaurant industry remains high

High turnover has long been a core tenet of the hospitality industry.

For restaurant employees added in the past year (August 2021-August 2022), the average employee tenure is just 110 days—a little over three months.

Of employees who joined their team in September of 2021, just 38% are still with that team as of the time of writing—a 62% turnover rate. Employees who joined in December of 2021 are faring slightly better—just a 55% turnover rate. But as we see with the average employee tenure, that number is likely to increase.

Back-of-House and Front-of-House are an even split

7shifts data shows no large discrepancy between turnover rates in the front- and back-of-house.

Front-of-house positions (including servers, hosts, and bartenders), fare slightly worse than back-of-house positions (including cooks, porters, and dishwashers).

Front of House Positions: 41% turnover rate

Back of House Positions 43% turnover rate

What about managers?

Managers fared a bit better than hourly employees—with a turnover rate of 28%.

State by State Breakdown

While the data didn’t vary drastically state-to-state, New Hampshire, Minnesota, and Hawai’i fared the best.

On the bottom of the list were New Mexico, North Dakota, and Idaho.

City by City Breakdown

For the restaurant-dense metropolitan areas, the Twin Cities and Boston came out on top.

And Atlanta, Vegas, and Richmond, VA fared towards the bottom.

Appendix: Data Methodology

The 7shifts Restaurant Turnover and Retention Playbook, uncovers key trends across the restaurant industry through aggregated and anonymized 7shifts platform and engagement data. This data study analyzes trends and data from August 2021 to August 2022, over 635,000 restaurant employees in the United States.

Why do employees leave their restaurant jobs?

So, what affects restaurant employees’ satisfaction in the workplace the most? Why do they leave jobs? And what can operators do more (or less) of to make hospitality a long-term and viable career?

We surveyed nearly 4,000 restaurant employees late last year to learn what affected their happiness and what they wanted to see more of.

1. They aren’t making enough money

While money isn’t everything, it’s long been one of the biggest pain points for restaurant workers. According to our latest survey, nearly half of all restaurant employees hover in the $11-15/hour (45.8%). 73% of those employees still receive tips. Wages are the main factor behind why restaurant employees quit their jobs, with 34.6% citing wages as a reason for leaving a job or a reason for why they are planning to.

2. Lack of recognition

Restaurant work is challenging. And hard work must be recognized. Among the over 25 sets, manager recognition (or lack thereof) was one of the top three reasons they left restaurant jobs. Recognition, especially public, also reinforces what “good” looks like at your restaurant and creates an example.

3. Promotions are uncommon

Another facet of this is the growth that comes with recognition—such as promotions. A third of restaurant employees surveyed said that they’d like to see recognition come in the form of promotions. Without solid training and growth opportunities, you could be letting great employees go to the restaurants that already have them.

4. Communication breaks down

72% of employees ranked team communication as necessary to their satisfaction at work. With so many moving parts, miscommunication is all too common in restaurants. Things get lost when conversations start verbal, go to text, and end up in an email. Unclear communication leads to frustration and a less-than-stellar work experience.

5. No access to benefits

In addition to wages, benefits are a significant component of an employee’s compensation. The restaurant industry doesn’t have the best reputation for offering these benefits. Overall, hospitality accounts for some of the highest rates of uninsured workers. Many employees left the industry during the pandemic in search of better benefits in other industries; hospitality has to adapt to prevent more from leaving.

Real ways to tackle restaurant retention problems

Restaurants are struggling with turnover, and the pandemic has exposed many longstanding issues with the working environment. With the restaruant workforce smaller than it was two years ago, retention is as inportant than every. But how do you keep employees happy? We spoke to modern restaurant leaders and consulted our roster of partners and clients to find out the tangible ways that restaurants are doing to reduce turnover. Here are five plays that you can run to make sure your team is happy.

Meet The Experts

• Jim Taylor, Founder, BenchmarkSixty
• Adam Lamb, Solutions Specialist, BenchmarkSixty
• Kelly McCutcheon, VP of People, Hopdoddy Burger Bar
• Mike Bausch of Andolini’s
• Dan Simpson, CEO, of Taziki’s Mediterranean Grill

 

1. Check your culture

“Everybody has a culture, whether they work at it or not. The question is, is it an uplifting, intentional culture?” asked Danny Meyer in a recent interview with 7shifts and QSR Magazine. Restaurant culture is how you do the things in your restaurant and why you do them that way. And at its foundation lies your business’ core values.

Take a close look at your restaurant culture. Does your restaurant have core values that guide the customer and employee experience? If you already have core values established—that’s great! If you haven’t looked at them in a while, it may be time to audit them and see if they’re what your business needs now and to grow in the future.

If not, it may be time to sit down and establish some.

The Play: Do a culture audit and examine your core values.

Gather the key stakeholders in your business—owners, operations, managers—and start a conversation. This group could be a team of corporate leaders and store managers for large restaurant operations. For smaller operations, it may just be the owner and GM.

This simple framework, shared with us by Kelly McCutcheon at Hopdoddy Burger Bar, will have you well on your way to a fresh (or refreshed) list of core values to give your team purpose behind their work, creating a great culture in the process—one that attracts and retains staff.

Look to the difference makers in your team

“We were each challenged to list 3 team members, and those team members had to be difference makers. The ones that, if we could only build out the team with these three people, who would it be?” says McCutcheon.

Then they each wrote them down (in secret) and shared them.

“The first thing we realized was how much overlap there was. We already had 20+ locations when crafting these core values. We chose everyone from hourly, to managers, to regional, and beyond. We had a lot of commonalities,” says McCutcheon.

If you don’t yet have an entire team and are just starting, think hypothetically about the perfect employees for your business. What qualities would they have?

Start a conversation about what makes them great

The next step is to start a conversation about the people you chose. “What is it about the three that you chose that makes them difference makers, what makes them stand out, and what are those characteristics you want to see in others?” says McCutcheon, “We came up with a list of 50 to 60 different characteristics. You started to notice the similarities.”

Grouping like characteristics is essential. For example, they realized that “driven” and “hungry” are similar. “We started grouping them together and initially had around five different categories. Then you have to do the really tough thing. You have to say what doesn’t fit and start crossing things out,” said McCutcheon.

McCutcheon found that you may come up with something that may feel right but not sound right. It may take some time to marinate, but sitting on it for a bit to see how it feels helps ensure you’re not rushing the process.

Hone in on the standouts

Once you have a shortlist and have eliminated duplicates, start crafting the language.

Here are a few examples of core values, from leading restaurant brands:

Entrepreneurial Spirit – Union Square Hospitality Group

Seeing opportunities others haven’t; creating solutions others wish they’d thought of first.

Have the Hunger – Hopdoddy Burger Bar

We believe in grit, determination, and serious love for burgers.

Ownership – Restaurant Brands International (Burger King, Tim Hortons, Popeyes, Firehouse Subs)

You value things more when you own them.

Family Hospitality – Villa Restaurant Group

The Scotto Family’s vision is to “treat everyone in a warm, friendly, genuine manner, as you would Family.”

Be The Smith – The Smith Restaurant Group

We are all empowered to MAKE a difference.

But it’s not enough to just say what your values are—you have to walk the walk. Showcase your core values in your employee handbook, new-hire training, job descriptions, and company careers page.

And to reinforce these values, find who’s exemplifying them on your team, and shout it from the rooftops.

2. Establish clear lines of communication.

A team can only be as successful as how well it communicates. And when it comes to the day-to-day operations, staff members overwhelmingly prefer text, 7shifts chat, and calls. Email is OK, but if you’re thinking of using social media to communicate with employees—don’t.

Beyond the essential day-to-day communications, there are times when in-person chats can help identify more significant issues or get a closer look into what’s going on with your team. In our latest survey, more than two-thirds of restaurant employees said that more 1-on-1 meetings with management would affect their happiness at work. But they’re less common in the restaurant industry than in the corporate world.

Maybe it’s time we change that.

The Play: Implement regular meetings.

In addition to the all-staff and pre-shift meetings that you should already be running, consider implementing 1-on-1 meetings between managers and staff on a rolling basis—once a week for small teams, once a month for larger groups.

A staple of the tech world, 1-on-1 meetings are a great way to keep in touch with your front-line staff.

In the words of Adam Lamb: “How are front-line staff supposed to know that you care unless you invest your time and energy with them?” You can’t expect someone to engage with you if you don’t engage with them, especially from a position of power.

The benefits of holding one-on-ones are two-fold: employees feel heard and appreciated, and you can get insights on how to run your business better.

“Some of the best operational suggestions came from our front line folks,” says Thomas Girard, speaking of his 15 years in restaurant management (Girard is currently the Partnerships Director at Lunchbox).

Below you’ll find a template for running these meetings: simply make a copy of the form and use it as you see fit for your business. Better yet—create a new copy each time to keep records of the staff meetings so you can go back to reference them. According to pros, here are a few questions you may want to ask:

• Please tell me of one ‘win’ you’ve had in the last 48 hours.
• Is anything new going on in your life?
• How’s your schedule working for you?
• If you could change one thing in the operation, what would it be?
• What would you like to see more of/less of?
• What are you hearing from customers and co-workers we need to address to improve their experience?
• What can we do to help you achieve your personal and professional goals?

3. Track and manage employee workload

It’s no secret that working in restaurants is hard work. But it doesn’t have to be back-breaking.

Jim Taylor, the founder at BenchmarkSixty, is on a mission to change that.

“[We’re] making sure that we highlight the difference between hard work and working too hard,” says Taylor.

He believes that the best way to manage labor costs is by managing employee workload—creating efficiencies that help margins and give you more cash to improve the employee experience with higher wages and better benefits.

Taylor likens it to an assembly line—when it’s moving steadily, you can get your work done, and the company makes a profit. But when other factors—internal or external—speed the belt up, your quality of work decreases along with the customer experience. This causes the company’s profits to go down and employees to get stressed and quit.

“Operators need to get away from the fact that it’s about, you’re better at your job than I am, or you can handle up at your section than I can. It’s about overall business productivity,” says Taylor.

“There is a direct correlation between improved productivity and increased revenue.”

The Play: Start measuring employee workload

As a whole, productivity is measured by the total number of staff that has to work throughout the day divided by the number of customers served in a day. Measure this, and start tracking it. You may begin to find that there is one day a week where you have an overworked staff that’s turning diners away or giving unappealing quote times (making them less productive). Or a weeknight where you could stand to have two fewer servers.

The customers served metric can provide a more accurate portrayal of how hard an employee is working—more so than sales per labor hour, which ticket prices can skew.

Once you have a better idea of how hard your team works, you can make incremental changes to improve productivity.

As an owner or manager, Taylor recommends spending a week near your entrance. Stay put, as best you can, and count how many customers leave because they didn’t like the interaction they got.

Restaurant owners can make these incremental improvements by scheduling smarter or training their employees on quote times or table turns. Employees who aren’t overworked can provide better customer service, upsell more effectively, and help drive average customer spend up.

“So we typically say that a restaurant that does $3 million a year in revenue, If we can find a 5% improvement in productivity, that typically equates to an opportunity somewhere in the $80,000 a year annually range,” says Taylor.

And what can an operator do with that extra cash? Use it to pay employees more or provide new benefits—increasing retention without impacting profits.

4. Schedule with empathy

Andolini’s restaurant group in Tulsa, OK, comprised of 6 locations, maintains a 35% attrition rate annually. They attribute a lot of that to what owner Mike Bausch calls scheduling with empathy.

“If you want anything, you have a direct line of communication with us to say it all. Your managers care about you. It’s a really simple difference where the restaurant industry, especially ten years ago, was like, ‘The schedule’s the schedule; if you can’t work it, find another job,’ and now it’s like, ‘Hey if something comes up, let us work with you. We have all these stores here; someone should work Sunday night if your daughter has a dance recital you didn’t know about. Let’s figure it out’,” says Bausch.

Bausch implores his team to “schedule with empathy, not a hard-line approach.”

“I think it’s extremely undervalued how directly connected a schedule is to staff morale, attrition, and retention,” says Bausch.

It’s required of Andolini’s management to post schedules 14 days ahead of time. This allows for the team opportunities to plan out their life.

“You’re posting [the schedule] on [the Saturday before], [the team] is like, ‘I don’t know if I can go to the lake next weekend. I don’t know if I can be at dinner with my friends on Wednesday. I don’t know if I can pick up my daughter from school on Thursday.’”

Getting the schedule out weeks in advance does require team members to submit availability, too. But Bausch believes that people adjust to that expectation: “People just need the fence of what they’re allowed to run inside of, and they’ll be fine,” says Bausch.

All it takes is the right intentions.

The Play: Implement a flex scheduling policy

You cannot let a schedule become a list of names. Remember that everyone on your team has unique life circumstances that must be accounted for when building the schedule. College classes, kids at home, second jobs, and other responsibilities all factor into someone’s availability. Here are a few examples of what a flex scheduling policy would contain:

Get the schedule out in advance

Get the schedule done ahead of time and send it to employees with enough lead time to plan their lives. Generally, two weeks ahead is a scheduling best practice, and it’s the law in some cities.

Two days off in a row

If possible, give your team back-to-back days off. This allows them ample time to relax and recharge.

Create a shift swap policy

Even when you give lead time, things come up. Give your employees the flexibility to swap shifts with their coworkers in the event of last-minute changes.

5. Offer tailored, valuable benefits

When we think about employee benefits, health insurance and retirement (401k) usually come to mind. According to a study from BlackBox intelligence, 63% of restaurants offered wellness benefits in 2021, up 25% from pre-pandemic levels.

But benefits can go beyond those basics and give restaurant employees what they need to lead happier healthier lives. Wages are up across the board. Benefits can be the difference in why an employee chooses you over the restaurant down the street.

Look to what your staff needs by talking to them, and create a benefits program tailored to them.

Taziki’s Cafe, with nearly 100 locations and 3000 employees, manages to retain staff at a rate higher than the industry average. How? By developing a keen understanding of who works for them and what they can do to provide them with a career that reflects that.

On an episode of the 7shifts podcast in 2021, Taziki’s CEO, Dan Simpson, broke down their practical approach:

“Correct diagnosis is key if you want the right remedy. And here’s where there’s a bit of a gift that we all have in our organizations…we go to great lanes to deploy all this technology for customer segmentation and mosaics and, and all this analysis to figure out exactly who they are and what makes them tick and what they value in that. How do we change our marketing to appeal to them? What if we apply the same discipline—marketing and advertising—to our staff? Let’s first start by breaking them into segments, so we can truly understand their different values and needs and then deploy the right fix,” says Simpson.

The Taziki’s team was able to separate their staff into three “buckets”:

• Younger millennials and Gen Z
• Working parents
• Spanish-speaking immigrants and refugees.

With that in mind, Taziki’s offers benefits that serve their employee’s specific needs.

For the younger generation of part-time workers, this means things like real-time pay to help break the paycheck-to-paycheck cycle.

For working parents, flexible schedules for childcare and retirement benefits for the future.

And for First-generation Americans, English language tutoring. “While we see value across a variety of different languages, we know that sometimes a language barrier can be a barrier to advancement, and we don’t want that to be the case,” Simpson adds.

Benefits are just the tip of the iceberg. But combined with paying a living wage, flexible schedules, an opportunity to advance, and performance bonuses that are part of everyone’s experience serve as table stakes for building great teams.

 

The Play: Implement one creative benefit for your team

Talk to your staff and survey them: what’s one thing we could offer to make your life easier? Engage them in a conversation about what benefits may suit them best. A 401k may not mean anything to a 19-year-old student. And college book reimbursement isn’t going to make a difference for the working parent.

The bottom line is that benefits aren’t one-size-fits-all. Talk to your staff, and identify the different needs they may have.

Here are some examples of creative benefits that employers are offering staff:

• Rideshare credit for safe travels home after a night shift at &pizza
• Pet insurance
• Home cleaning or laundry service
• English language tutoring
• School book or tuition reimbursement

86 turnover in your restaurant

High employee turnover is the biggest challenge facing the hospitality industry in 2022, and has been for a long time.

The old way of restaurant team management doesn’t work anymore. And for restaurants to thrive moving forward, staff retention is paramount.