The global stock market was in turmoil and the Dow Jones Industrial Average was headed for a drop so steep market watchers would dub it “Black Monday,” but Chipotle Mexican Grill Inc. had some good news.
The popular fast-casual chain was planning a one-day hiring blitz on Sept. 9, interviewing applicants at all 60 U.S. locations with the goal of adding 4,000 new workers to its 60,000-person payroll. The release touted Chipotle’s benefits, opportunities to move up the corporate ladder and tuition reimbursement program.
We’re in strange economic times when a job posting for a restaurant chain is filled with perks that could inspire envy from hard-hit workers in the oilpatch and probably more than a few stockbrokers after last week’s rough ride. Overall job growth in Canada and the United States has been sluggish since the economy started recovering from the financial crisis, but not in the restaurant sector, where wages are rising as employers struggle to find enough qualified workers to keep up with demand.
“Restaurant work is very hard. You work very long hours, very late hours. You’re not paid much money. It burns people out,” said Tom Pirko, president of the food and beverage company advisory firm Bevmark LLC. “You have to have workers and you have to have workers that are paid a reasonable amount of money.”
One in six new jobs created in the U.S. since mid-2009 has been in the food and hospitality industry, according the U.S. Bureau of Labor Statistics. The industry association Restaurants Canada says the food service was the No. 1 job creator in the country last year, adding 31,300 jobs to the workforce.
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The wages of food services workers have improved as well, buoyed in part by recent minimum wage increases in many states and provinces and by more demand for restaurant food as the economy improves. Wage growth in the Canadian food service sector has grown faster than the average industrial wage since the economic recovery began, according to Restaurants Canada. In the U.S., the hourly wages of food and hospitality workers grew 2.9 per cent in July compared to the same month the previous year, with average American wages overall growing just 1.9 per cent year over year.
Mary Chapman, director of product innovation at Chicago-based food industry market research firm Technomic Inc., said two distinct approaches are emerging for dealing with these labour market pressures. Some companies see wage inflation as a menace to be contained at all costs, while others like Chipotle and Starbucks Corp. see an opportunity to make treating their employees well part of their marketing pitch.
“Not only do employees want to be treated fairly and want to have fair benefits, but consumers want to visit places that want those things as well,” Chapman said. “They want their values to match mine, as the consumer.”
David Smith, a labour economist at Pepperdine University in California, said job growth has been disproportionately concentrated in the extreme low end and extreme high end of the wage scale. Wage growth in the restaurant industry is great for restaurant workers, but may not be great news for the economy overall, he said.
“It is a little bit troubling, because those aren’t jobs that are going to fuel buying a house, a car, settling down,” Smith said. “It’s not what you like to see in a robust labour market.”
Financial Post
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