This study represents the first national employer survey of work and human resource management in the US Restaurant Industry. It documents the range of practices adopted by employers and how those practices affect turnover and employment stability—problems that are endemic across the industry. We examined management practices and outcomes in four customer segments: fine upscale dining, casual fine dining, moderately priced family restaurants, and fast food/quick service (fast food) restaurants. High levels of employee turnover are problematic in restaurants serving all four customer segments—leading to higher employee costs and lower service quality and organizational performance. In fact, our survey data demonstrates that better human resource practices can reduce employee turnover almost by half.
We surveyed restaurants in the 33 largest metropolitan areas of the country, where wages and the cost of living are likely to be higher than in smaller cities and towns—and where higher competition is likely to drive employers to invest more in employees in order to compete more effectively on quality and service. Over half of these restaurants are located in states with tipped and non-tipped minimum wage rates that are considerably higher than the federal minimum rates. Thus, the wages, human resource practices, and turnover reported by managers in this sample should represent somewhat better conditions than those found in a nationally representative study. Nonetheless, even in this sample, the proportion of restaurants that adopt better human resource (HR) practices and invest in the workforce is modest. Several findings are noteworthy.
