The Perfect Storm
Workforce Challenges Need Smart Strategies, Partnerships
per·fect storm noun
“a particularly bad or critical state of affairs, arising from a number of negative and unpredictable factors” (i.e.) "the past two years have been a perfect storm for the travel industry" Oxford Languages.
Truth, Google it! Oxford actually used our industry as an example of how to use the phrase “perfect storm.”
With more people becoming vaccinated, many operators felt great relief and were optimistic as customer demand continually, and in some cases monumentally, increased. Meeting this sudden ramp up would have expected challenges, of course, but few could have predicted that the biggest challenge was yet to come. Hiring staff!
Workforce Challenges. Hospitality is not the only industry struggling to hire and, in fact, we were experiencing difficulties pre-pandemic as well. But as one of the most battered by closures due to the pandemic, we are also among the hardest hit by hiring challenges. Few things can hamper economic recovery, or be more frustrating, than being unable to meet customer demand when there is facility capacity, but lack of workers to fulfill the need. While there is not a treasure map of where to find ready to work employees, and/or how to keep them, there are best practices and resources identified that I hope are helpful.
Not One Strategy But Many. In the short term, partners have experienced some success by raising pay, offering hiring and/or length of term bonuses, creating referral programs, and offering housing stipends. Other tactics are proven to also strengthen appeal. These include:
Advertising starting rate and pay raise potential IN your ad. Failure to do so is cited by jobseekers and recruiters as the number one reason for lack of response. One successful employer actually advertised their starting rate on their company vans!
Decreasing amount of time between paychecks. Some operators are even paying daily, many at least weekly.
Emphasizing advancement opportunities and management support for career growth IN your ad. We have lost many veteran associates to other industries that could keep them employed during the pandemic when we could not. Those unfamiliar with our industry often do not understand the rapid career trajectory hospitality offers.
Guaranteeing shifts, even if demand is slower. One lodging operator shared that after analyzing their P&L, they realized that it was less expensive for them to keep seasonal employees on payroll during winter than to go through re-hiring and/or being forced to keep rooms unoccupied due to lack of staff. They planned to use the time to cross-train and focus on quality and service projects they never have time to do in summer, which will likely increase their Tripadvisor ratings for an even higher payback!
Promoting your company’s value system. Lockdown created time for many to reflect about their own ideals and how they want to spend their time. Are you a Certified B-Corp, do you support local philanthropic needs, are your business practices environmentally sustainable, do you hire people who have disabilities, do you pay employees to volunteer a few hours of their time? Recruiters note company culture is increasingly important as a deciding factor. For a good example of how to amplify culture, check out Elephants Deli’s hiring page at Elephantsdeli.com/about/careers.
Telling it like it is. On your hiring page, feature a few two-to-three-minute videos from actual employees. These do not need high production value, in fact, phone-recorded videos can be more credible. Focus on describing what the actual job is responsible for, what they like about working for your company, and even what the challenges are. Keeping it real is essential. Bandon Dunes needed golf course maintenance staff and received support from the Southwest Oregon Workforce Investment Board to create this recruitment video: youtu.be/3SJ_GZ95pvM. Though more highly produced than your company might need, you can see how effective this first-hand narrative approach can be.
Leveraging online training resources. The American Hotel & Lodging Educational Institute (AHLEI) offers online training at AHLEI.org/lodging to orient entry-level employees to their new roles before conducting on-site training. This approach can reduce the amount of supervisory training time needed and make the new hire more comfortable, increasing their desire to stay. Courses include front desk representative, kitchen cook, housekeeping attendant, restaurant server, and more. AHLEI and the National Restaurant Association also offer skill-building courses to help enthusiastic employees progress towards supervisory roles, while still working in their current position; visit ServSuccess.com for more information. Remember that your foundation, the Oregon Hospitality Foundation (OHF), also offers two online guest service courses–one which is specific to the pandemic’s service and safety challenges–at OregonGuestService.com.
Getting to know your local WorkSource Oregon agencies who work directly with jobseekers. Funded by your taxes and therefore offering no fee assistance, these teams are dedicated to “…to effectively respond to workforce challenges through high-quality services to individuals and businesses, resulting in job attainment, retention, and advancement.” Do more than just place an ad with the office. Developing a relationship can have a big pay-off with support most hospitality employers do not even realize is available. Visit Worksourceoregon.org/about for more information.
The Big Picture. When I wrote about this idea a few years ago, the strategy seemed like an interesting idea. Now it feels like an essential strategy in order to build a labor-source pipeline such as the healthcare, IT, and construction industry has done. How? Flex our collective economic and hiring impact, and gain attention from local workforce boards.
The purpose of Oregon’s Workforce and Talent Development Board (Oregon.gov/workforceboard) is to “Advance Oregon through meaningful work, training, and education by empowering people and employers.” Its nine regional development boards identify the most economically impactful employers in their local communities and offer tremendous strategic and financial support to create tactics that help meet these employers’ needs. Find your local workforce development board at bit.ly/9-LWDB and see what industries are currently regarded as major sectors. You will find the hospitality industry is regarded key in only one of Oregon’s nine regions thus far.
Until and unless the hospitality industry is recognized for the important economic role it has in the other eight regions, hiring, training, retaining, and advancing employees will continue to be our struggle alone, rather than engaging the expertise and funding support that Oregon’s workforce system offers.
In fact, as a pilot program, OHF, in partnership with the Oregon Coast Visitors Association and with assistance from workforce board leader and ORLA member Zack Poole (Pig-n-Pancake), has built a growing relationship over the past four years with Northwest Oregon Works (NOW). This workforce development board serves Clatsop, Lincoln, Tillamook, Benton, and Columbia counties. Thanks to these efforts and NOW board support, the Leisure and Hospitality Industry has recently been recognized as a major sector, the first region in the state to do so. To understand more about the positive impact of this collaboration, read more at bit.ly/OHFwbpr.
Weathering the Storm. While navigating through current workforce challenges, plotting a course toward an easier route can be feasible. See additional resources and learn more from OHF’s recent webinar, “Accessing Resources to Help Support Your Workforce Needs” at bit.ly/webinar052521.
I welcome your ideas, questions, and comments. Reach me at WPopkin@OregonRLA.org. | Wendy Popkin, Oregon Hospitality Foundation
Wendy Popkin is the Executive Director of the Oregon Hospitality Foundation, a nonprofit 501c3 dedicated to providing educational, training, and philanthropic support to Oregon’s restaurant, lodging, and tourism industry. Wendy is a 35-year career veteran who describes herself as “fanatically enthusiastic about helping others enjoy the same type of fabulous career opportunities I have enjoyed in the hospitality industry.” OregonHospitalityFoundation.org
Residents Should Have Say on Sales Tax on Meals
FOR IMMEDIATE RELEASE: July 12, 2021
Greg Astley, Director of Government Affairs, ORLA
503.851.1330 | email@example.com
Wilsonville, OR– The Cannon Beach City Council voted to approve a 5% sales tax on meals by a 3-2 vote, leading to a second reading on July 14th, 2021, to either ratify the sales tax or, if it fails, open the door for the City Council to place a measure on the ballot this November. The Oregon Restaurant & Lodging Association (ORLA) opposes the sales tax on meals in Cannon Beach and believes the residents of Cannon Beach deserve to have their voices heard.
“It’s unconscionable Cannon Beach City Council would even think about enacting a sales tax on restaurants after the last 16 months our industry has suffered through but it’s especially troubling they would choose to do so without asking for a vote of the people,” said Greg Astley, Director of Government Affairs for ORLA. “The restaurants fortunate enough to survive the wildfires, ice storms and global pandemic we’ve been through are still struggling to hire enough people to fully re-open and try to recover from their significant financial losses.”
Astley continued, “Although one City Councilor claimed residents would not be affected by the tax and therefore the sales tax on meals should not go to a vote of the people, nothing could be further from the truth. Residents will pay the sales tax on meals every time they go out to eat with friends and family unless they choose to stop patronizing local restaurants in favor of establishments outside the city limits.”
Beyond the obvious unfairness of asking one industry to shoulder the burden of paying for services everyone will benefit from, ORLA has outlined several other reasons why voters should be allowed to weigh in on a sales tax on meals:
Astley concluded, “At the very least, the people of Cannon Beach deserve to vote up or down on this sales tax on meals. An even better solution for the City of Cannon Beach would be to consider an Economic Improvement District or similar mechanism where the burden of raising revenue falls more broadly than on just the struggling local restaurants.”
The Oregon Restaurant & Lodging Association is the leading business association for the foodservice and lodging industry in Oregon, which before COVID-19 provided over 180,000 paychecks to working Oregonians.
Guest Blog | Let us Nudge
Our beloved Oregon restaurant industry is slowly making a comeback and that is good news for everyone! Other states are also letting restaurants get back to full capacity, as they are trying to recover lost revenue during the pandemic. But new issues are slowly arising as several documented articles online discuss how customers want to stay longer, so the need for these restaurants to turn their tables is required more than ever. We are also hearing everyday how restaurants across the country have started using time limits for their customers. Some customers may not like this, but the opportunity to help this industry is something we should all be thinking about, for now and the future.
We all enjoy dining out at restaurants and don’t ever want to feel rushed by any means. Time limits can work, but maybe there is something else for the long run. What if there was a way our favorite restaurant could offer customers a secure, seamless, and subtle “nudge” to help us help them turn their table faster, especially if they were finished with their meal? What if there was a way where we could help the Oregon restaurant industry seat more customers, especially during busy times? What if the restaurant had an option to actually incentivize the seated customer finished with their meal to help turn their table?
Again, it is positive to see restaurants slowly coming back to full capacity, but the need to serve more customers can really help Oregon restaurant owners with their bottom line moving forward. Reservation systems are great, and they help restaurants fill seats. But sometimes the systems lag when seated customers haven’t left their table. This tends to build up the bottleneck in the entrance area, which happens often in popular restaurants. Large chain restaurants get extremely busy as well, where anxious customers are waiting with pagers and devices to get seated. Most of the time, they are waiting for the seated customer finished with their meal, to turn their table to get seated. Again, no one ever wants to feel rushed, but a restaurant incentive could help improve table turnover efficiency.
Research and data have shown that customers are usually satisfied by incentives such as a discount, coupon, or free food or drink item, if needed. Of course, the restaurant can offer this incentive, though it is a fine balance to not rush them or get them upset and lose them for future visits, negative social media reviews, etc. Ultimately, it is up to the seated customer to accept the incentive willingly and help turn that table for the waiting customers.
Restaurants have fixed costs, the same amount of rent, minimum staffing needs for the kitchen and floor, etc., that they rely on for their daily operations. Then there are variables that restaurants see such as an increase in sales, more volume of customers, and amount of average check that all account for profitability. These fixed costs stay the same no matter how many customers dine in or not. An incentivized approach can help spread the overhead costs over a larger number of paying customers, which can help the restaurant bring in more revenue.
The opportunity to be busy, turn more tables, make profits, etc. are everything restaurant owners want, especially with the most important item being the wonderful food and drink they provide on their menu. That food and drink experience is the reason we as customers enjoy dining out with our family and friends. But that disheartening feeling steps in when we arrive at our favorite restaurant and the wait line is literally out the door. Again, most of the customers inside have finished their meal, and are enjoying social conversations. But maybe that restaurant incentive could help them turn their table a bit quicker, so others that are waiting can enjoy it as well.
The restaurant has choices regarding whatever incentive they want to give, be it a discount off the bill, or a coupon for another visit, etc. The seated customers can accept or deny this incentive, as they choose. Turning more tables for the Oregon restaurant industry can help recover revenue lost during the pandemic. This recovery can help now and for the future, as the opportunity to turn tables at Oregon family-owned, casual-chain, and fine dining restaurants, will improve the dining experience for all. Visit letusnudge.com to explore opportunities. | Rehan Khanzada, Let us Nudge
This guest blog was submitted by Let us Nudge. For more information on guest blog opportunities, contact Marla McColly, Business Development Director, Oregon Restaurant & Lodging Association.
Guest Blog | Dell Technologies
Data, data everywhere and not a drop to drink. Study reveals businesses are struggling to reconcile conflicting data realities caused by overwhelmed technology, people, and processes.
In 2016, Dell Technologies commissioned our first Digital Transformation Index (DT Index) study to assess the digital maturity of businesses around the globe. We have since commissioned the study biennially to track businesses’ digital maturity.
Our third installment of the DT Index, launched in 2020 (the year of the pandemic), revealed that “data overload/unable to extract insights from data” was the third highest ranking barrier to transformation, up from 11th place in 2016. That is a huge jump from the bottom to close to the top of the ranking of barriers to digital transformation.
These findings point to a curious paradox–data has the potential to become businesses’ number one barrier to transformation while also being their greatest asset. To learn more about why this paradox exists and where businesses need the most help, we commissioned a study with Forrester Consulting to dig deeper.
The resulting study, based on a survey with 4,036 senior decision-makers with responsibility for their companies’ data strategy, titled: Unveiling Data Challenges Afflicting Businesses Around the World, is available to read now.
Candidly, the study confirms our concerns: in this data decade, data has become both a burden and an advantage for many businesses–which one depends on how data-ready the business might be.
While Forrester identifies several data paradoxes hindering businesses today, three major contradictions stood out for me.
1. The Perception Paradox
Two-thirds of respondents would say their business is data-driven and state “data is the lifeblood of their organization.” But only 21% say they treat data as capital and prioritize its use across the business today.
Clearly, there’s a disconnect here. To provide some clarity, Forrester created an objective measure of businesses’ data readiness.
2. The “Want More Than They Can Handle” Paradox
The research also shows that businesses need more data, but they have too much data to handle right now: 70 percent say they are gathering data faster than they can analyze and use, yet 67 percent say they constantly need more data than their current capabilities provide.
While this is a paradox, it’s not all that surprising when you consider the research holistically, such as the proportion of companies that are yet to secure data advocacy at a Boardroom level and fall back to an IT strategy that can’t scale (i.e., bolting on more data lakes).
The implications of this paradox are profound and far-reaching. Six in 10 businesses are battling with data silos; 64 percent of respondents complain they have such a glut of data they can’t meet security and compliance requirements, and 61 percent say their teams are already overwhelmed by the data they have.
3. The “Seeing Without Doing” Paradox
While economies have suffered during the pandemic, the on-demand sector has expanded rapidly, igniting a new wave of data-first, data-anywhere businesses that pay for what they use and only use what they need–determined by the data that they generate and analyze.
Although these businesses are emerging, and doing very well, they’re still relatively small in number. Only 20 percent of businesses have moved the majority of their applications and infrastructure to an as-a-service model–even though more than 6 in 10 believe an as-a-service model would enable firms to be more agile, scale, and provision applications without complexity.
Achieving breakthrough together
The research is sobering, but there is hope on the horizon. Businesses are looking to revise their data strategies with a multi-cloud environment, by moving to a data-as-a-service model and automating data processes with machine learning.
Granted, they have a lot to do to prime the pumps for a proliferation of data. Still, there is a path forward, by firstly modernizing their IT infrastructure so they can meet data where it lives, at the edge. This incorporates bringing businesses’ infrastructure and applications closer to where data needs to be captured, analyzed, and acted on–while avoiding data sprawl, by maintaining a consistent multi-cloud operating model.
Secondly, by optimizing data pipelines, so data can flow freely and securely while being augmented by AI/ML; and thirdly, by developing software to deliver the personalized, integrated experiences customers crave.
The staggering volume, variety and velocity of data may seem overpowering but with the right technology, processes and culture, businesses can tame the data beast, innovate with it, and create new value. | Sam Grocott
For more information, visit The Data Paradox page and to learn more about the solutions and services that can help your organization break through the data paradox.
For even more information and to get in contact with Dell Technologies, feel free to reach out to Steven Shipe, ORLA’s dedicated point of contact and account manager via email at Steven.Shipe@dell.com or visit www.dell.com/ORLA for program discounts.
Sam Grocott is the Senior Vice President of Business Unit Marketing for Dell Technologies.
This guest blog was submitted by Dell Technologies. For more information on guest blog opportunities, contact Marla McColly, Business Development Director, Oregon Restaurant & Lodging Association.
Guest Blog | BYOD, Inc.
Most of the conversations I am having with restaurant colleagues these days involve any number of terms: RRF, PPP, Covid-19, recovery, consumer confidence, and many more. However, at my own restaurants the conversations center around one thing: staffing. In 25 years, I’ve never seen an employment pool as shallow as it is right now. While the economy is seeing wonderful recovery (the unemployment rate fell by another .3% last month adding almost 550K jobs, and the economy grew by 6.4% in Q1 and continues to skyrocket), we in the hospitality industry are not experiencing the same boom. Reuters reports that 5.6% of restaurant workers quit their jobs in April (an all-time high according to Gordon Haskett Research Advisors) and the bureau of labor statistics shows the hospitality industry came out of April still down more than 2.8 million workers from where it was pre-pandemic, with an unemployment rate of 10.8% compared to the national level of 5.5%. On top of that, I haven’t spoken to an operator in months where the phrase “severely understaffed” doesn’t come up.
Though there are multiple drivers (unemployment benefits, governmental pandemic regulations, large wage increases in industries that weren’t shutdown, etc.) behind this situation, and we can all debate them until we are blue in the face. The reality of the situation is that a smaller and shallower hospitality employment pool is here to stay. With that sobering fact readily apparent after the last several months, we also are hearing a lot from “experts” stating the only way to attract workers back is to raise wages. With efforts from groups like the IRC as well as state and national government to push a $15/hour minimum wage it seems a bit like the industry is being pushed into accepting this new reality by bully pulpit and the peanut gallery. The problem seems insurmountable, especially considering the fact that industry wide we lost 110,000 restaurants permanently last year and almost $240 billion. However, the building blocks of an alternative solution to “raising wages and just keep raising them” are already in many other industries.
In the 1950’s the manufacturing and agricultural industries employed 1 in 3 Americans workers, but in 2009, it was closer to 1 in 8. What happened, you ask? Automation. We began to use machines, computers, and finally data to evolve how those industries work. Now I know I just lost some of you. For years people have told me how backward the restaurant industry is, and how technological behind we are. We’ve been slow to adopt new technologies and sometimes burned by the ones that we have. I hear the argument that while spending millions of dollars on technology might work for a big factory doing $1 million dollars a day in revenue, it can’t work for a restaurant doing $1 million in revenue annually. But that supposes that automation requires large physical infrastructure, expensive software programs, large implementation teams, and a number of other hurdles that make it very difficult for an industry that is made up of more than 60% independent operators to consider implementation.
Automation is something that the restaurant industry has championed for years (just ask McDonald’s), but it has approached it from the standpoint of unit replicability, when what we need to focus on as an industry is how automation applies to a single unit. Simply put, are there tasks that technology can do (perhaps better than humans) that can be easily and inexpensively implemented? The answer is a resounding yes – with machine learning and artificial intelligence. Why couldn’t an AI build a schedule better than an assistant manager? Crunch data and predict sales and staffing at better rate? Coordinate your ordering for you? Essentially remove all of the mundane “office” jobs that an operator deals with on a daily basis so that they can focus on more important tasks? If a manager could skip 50% of their paperwork to spend more time training the limited staff that they already have (because an AI did it for them), could that staff begin to handle a higher workload? If consumer interfaces could start with technology as a welcome funnel (QR codes, AI engaged CRM’s that auto-seat customers) could that allow restaurant to do more with less staff?
In the end, what I believe will come out of the pandemic is not necessarily higher wages, but a greater reliance on technology as an interface between management and staff as well as restaurants and their customers. Technology isn’t the only solution to the current job market, but it certainly seems like a more palatable one. | Samuel Short
Sam is the Chief Strategy Officer for BYOD, Inc., a Restaurant-focused Artificial Intelligence company. Sam also owns a restaurant group in Michigan and has spent the last 25 years in the restaurant industry. He served on the board of the Michigan Restaurant and Lodging Association for many years.
This guest blog was submitted by BYOD, Inc. For more information on guest blog opportunities, contact Marla McColly, Business Development Director, Oregon Restaurant & Lodging Association.
2021 Legislative Win for ORLA
Senate Bill 317A passed, making permanent the ability for bars and restaurants to offer mixed drinks for takeout or delivery if the guest also purchases a substantial food item.
Restaurants and Bars Among Hardest Hit by COVID-19 Pandemic
[July 20, 2020 - Wilsonville, OR] – The Oregon Restaurant & Lodging Association (ORLA), in partnership with the National Restaurant Association, recently completed a statistically significant survey around To-Go Cocktails, drinks made with distilled spirits for takeout, pickup or delivery to go along with meals purchased by guests.
The survey, conducted July 3-6th, shows 72% or nearly three in four Oregonians, said they would favor a proposal allowing customers to purchase cocktails or mixed drinks (made with distilled spirits) with their takeout and delivery food orders from restaurants. This is in addition to beer and wine, which is currently allowed.
Support is highest among those between the ages of 24-39 at 83%, with respondents between the ages of 58-74 showing the least support at 66%. Twenty-eight percent of adults said they strongly favor the proposal. Fifty-nine percent of Oregon adults said they purchased takeout or delivery food from a restaurant for dinner during the week before they were surveyed.
ORLA President and CEO Jason Brandt said, “This is so encouraging for our members who have struggled just to stay open and keep people employed.”
Brandt continued, “This has been an incredibly difficult time when restaurants and bars have struggled to deal with the challenges of being shut down, having to pivot to offer only takeout, pickup or delivery and then trying to invite guests back into dining rooms and make them feel safe and comfortable. Knowing almost three out of four Oregonians support the option to purchase cocktails or mixed drinks to go with their meals means some restaurants and bars who might have previously had to close down actually have a chance to make it now.”
Allowing customers to purchase cocktails or mixed drinks (made with distilled spirits) for pickup, takeout or delivery requires a statutory change, meaning the Oregon Legislature would need to make the change to state law. Thirty other states currently offer To-Go Cocktails including Washington and California.
“From a public safety perspective, if more businesses are able to offer the service of delivery of alcohol to their customers, the need for those customers to physically go into stores and businesses is reduced, thus reducing the risk of community spread of COVID-19,” said Brandt.
Recognizing the need to help those who may have difficulty with alcohol addiction, ORLA’s website outlines a number of resources available to individuals, as well as training information to aid in prevention. More information on these resources and trainings can be found at OregonRLA.org/crisis-services-and-training.
For more information please contact Greg Astley, ORLA Director of Government Affairs at 503.851.1330.
Key Issue: Lodging Taxes
ORLA Advocacy: Promoting and Advocating for Tourism Investment Plans
[update 7.1.21] - 2021 Legislative Session Win
HB 2579 (Dead) – Increases state transient lodging tax rate and provides for transfer of moneys attributable to increase to county in which taxes were collected.
HB 2267, from Oregon’s 2003 Legislative Session, was designed to raise revenue for the promotion of tourism in Oregon. First, the bill instituted a 1 percent statewide lodging tax on all lodging properties in Oregon. This money was dedicated to the promotion of tourism through Travel Oregon, acting as Oregon’s tourism department. Second, the bill required any local governments with a lodging tax in place to determine what percentage was currently being used for tourism promotion and maintain at least that level in the future. The percentage is not allowed to decrease. The bill also required any local government that institutes a local lodging tax in the future to use at least 70 percent of the new revenue for tourism promotion. No more than 30 percent of the new revenue can be used for general funds or other non-tourism functions.
The Oregon Restaurant & Lodging Association has worked with Local governments to clarify collection laws around Online Travel Companies. This should bring in millions of dollars more annually for tourism promotion.
ORLA is also involved in efforts to attract events to Oregon that bring visitors and promote the state. Some examples in recent history were helping to pass legislation that added money to improve college athletic programs and allowing for NCAA March Madness games to be played in Oregon, and protecting tax credit programs that bring film and video production to Oregon.
ORLA must ensure that these state statutes remain in place. Any lodging taxes, state or local, need to bring travelers and businesses to Oregon. All retail businesses profit from increased travel; additionally, local government must be encouraged to keep promotional dollars directed to these efforts. Finally, there are always opportunities to attract more events like feature films, major sporting events, concert venues, and wine tours that benefit the industry as a whole. ORLA will work to enhance these efforts, which bring people to Oregon and encourage Oregonians to travel more in and around the state.
Oregon Restaurant & Lodging Association supports current laws that protect lodging tax dollars going to tourism promotion and tax credits that encourage film and video attraction to Oregon. ORLA believes in protecting the dedicated tourism funds to ensure they continue to be allocated to tourism promotion at the state and local levels. This effort will benefit all retail businesses and local economies throughout our state.