Traditionally high employee turnover and the recruitment, training and workforce management issues that come with them are concerns that many restaurant owners share. In 2014, the average turnover rate was 66.3 percent, according to the National Restaurant Association. If you view this average from a wide perspective and in the right context, though, turnover rates in the restaurant industry aren’t as troublesome as they might seem at first glance.
The Big Picture
According to the U.S. Bureau of Labor Statistics 2014 Job Openings and Labor Turnover Survey, the 66.3 percent average turnover rate includes averages from three separate components. Voluntary separations accounted for the largest average of 46.5 percent. Employee layoffs and involuntary terminations accounted for another 17.2 percent. All other separations, including retirements, work-related transfers, death and disability-related separations accounted for 2.6 percent of the average turnover rate.
Average turnover rates for the restaurant industry will always be higher than turnover rates in the private sector as a whole. According to the National Restaurant Association, the workforce composition of restaurant employees is a major contributing factor. The U.S. restaurant industry employs about one-third of all working teenagers -- more than any other industry. Many of these approximately 1.5 million people are new to the workforce and will move on to other jobs after gaining some work experience.
Nature of the Business
The seasonal nature of the restaurant industry also contributes to high average turnover. However, the effect of seasonality isn’t as dramatic as it may seem. Although restaurant employment increases by about 400,000 people during an average summer, many of these seasonal employees are students who don’t work year round anyway. When summer ends and employment levels shrink, a combination of students returning to school and fewer customers softens some of the effects of employee turnover.
According to the People Report Workforce Index, historical averages show that fast-food restaurants have the highest average turnover rates for hourly crew employees and restaurant managers, followed by fast casual family dining restaurants, casual dining and upscale restaurants. In a 2011 "QSR" magazine article, Christopher Muller, the dean of Boston University’s School of Hospitality Administration, attributed this to a tendency among restaurant owners to treat restaurant workers as expendable employees. Public perception also plays a role, as many people view working in a fast-food restaurant as a dead-end job.
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