SAN DIEGO — What if all of the country’s restaurants reopened their doors following a yearlong pandemic that forced massive layoffs and hardly anyone showed up? To work.
It’s more than a hypothetical riddle.
As drinking and dining venues across the nation get the green light to more widely welcome back the customers they’ve been craving since COVID-19 first shut them down almost 14 months ago, many employers have been confronting a near-crisis labor shortage.
While it initially caught them off guard, it shouldn’t be all that surprising.
It’s something of a perfect storm as the country transitions into life under increasingly relaxed reopening rules driven by rising vaccinations and diminishing infection rates. That, in turn, has unleashed a torrent of job openings not only for restaurants and bars, but also for hotels, casinos, theme parks and other service industries at a time when enhanced jobless benefits remain alluring.
It is difficult enough to find cooks, dishwashers, servers and bartenders that many pandemic-battered restaurants are dropping lunch service, closing earlier than normal or staying open fewer days a week because they lack the manpower to serve the guests they know are eager to eat out.
The once familiar lament that overly strict COVID-19 guidelines were killing their businesses has been supplanted by urgent appeals for jobs and at pay considerably higher than just a year ago.
“After 14 months of COVID hell, you finally get the orange light to open up at 50% capacity and you can’t find people to come back to work,” said David Cohn, co-founder of the Cohn Restaurant Group, which is looking to fill 200 positions at its 20 venues across San Diego County. “We’ve reached out to the San Diego Workforce Partnership, every culinary program. At Corvette Diner, which we’ve struggled to reopen, we reached out to theater groups because it’s about entertainment at that restaurant. We said if you bring us people with the right attitude we can teach them to be servers or bussers or soda jerk.
“The unemployment rate is still so much higher than it was pre-COVID, you thought there would be all these people who would be anxious to come back to work.”
Corvette Diner just reopened earlier this month — albeit not yet at its normal seven days a week — thanks in part to the recruitment of several local theater performers, who’ve also been hit hard by the pandemic.
So frantic are some restaurant owners they’ve resorted to poaching others’ employees, asserts Dario Gallo, owner of Civico by the Park in Bankers Hill and Civico 1845 in Little Italy.
“A restaurant sent workers to approach my employees and they would say, ‘How much are you making? OK, $17 an hour? I’ll give you $19 or $20 an hour if you come today,’ and they don’t even give two weeks notice,” said Gallo, who is now offering to pay $3 more an hour than his previous average. “So literally I was about to close both locations. Thank God, my brother at Civico and my chef at 1845 jumped in to do line cook duties, dishwashing, preparation during the day.
“It’s like a war, just because it feels like this is endless.”
Employers say they will place ads across multiple online platforms, and if they’re lucky enough to get any responses, few, if any, candidates will show up for interviews, despite offers of higher pay than before the pandemic and tantalizing signing bonuses in the hundreds of dollars.
“I’ve had multiple job fairs where we have great turnout but we don’t get people all the way through the process,” said Erin O’Mara, operations manager for the Cohn Restaurant Group. “They just ghost you. They just don’t answer their phone, they don’t return your call, they don’t say I found another job, you just don’t know why they didn’t show up.”
Competing with unemployment benefits
Job posting sites like Indeed.com and Craigslist are bulging with listings that seem to broadcast the desperation of those doing the hiring.
“COOK and SERVER positions WE WILL BEAT YOUR CURRENT PAY.” “Dishwashers — Get hired today! Start at $20/hr for min 6 wks!” “*$300 SIGN ON BONUS!* Line Cook at The Crossings at Carlsbad.”
Nationally, Indeed.com job postings for the food-service industry are up more than 20% compared to Feb. 1, 2020 — a month before the onslaught of the pandemic. The current volume of posts is the highest since March of last year, the company said. While Indeed was unable to break out restaurant job listings for San Diego County, overall postings for the metro area are 34% higher than they were on Feb. 1 of last year.
Employment in restaurants and bars has clearly started to rebound as state-prescribed indoor capacities have increased, with a full reopening expected by June 15 when California officials have said the color-coded, tiered reopening system will end.
Last year when the pandemic shut down restaurants in mid-March, jobs vanished overnight. By April of 2020, the 132,400 jobs in place just a month earlier has plummeted to 67,700. As of March of this year, that number has jumped to more than 102,000 but is still far short of pre-pandemic employment.
The reasons for the disconnect between San Diego’s still relatively high unemployment rate — 6.9% — and an abundance of unfilled positions are many. Leading the list, say a number of employers, is the competition they’re facing from the federal government, which is offering supplemental unemployment insurance benefits of $300 a week for laid-off workers, due to expire in September. In some cases, hourly workers find they can earn more on unemployment than what they could returning to their former jobs.
San Diego economist Lynn Reaser did a calculation showing that, based on an average workweek of 26 hours, restaurant workers who lost their jobs early in 2020 could earn $525 a week on unemployment (including the extra $300), versus average weekly earnings on the job of $452. Of course, many in the industry are now working more hours, including overtime, as operators do whatever it takes to keep their businesses open at maximum capacity.
“People always take time to consider different job opportunities, while restaurants are desperate for a lot of employees immediately,” said Reaser, chief economist with Point Loma Nazarene’s Fermanian Business & Economic Institute. “The competition among restaurants has given workers, especially for those with some experience, an edge. The unemployment benefits have also given them a cushion allowing them to be more choosy.”
She points out that the yearlong pandemic also has given hospitality workers plenty of time to rethink the trajectory of their careers and consider a change to a different profession as they navigated on-again, off-again openings, closures and layoffs.
Employers report that still others left California for lower-cost states, while some former workers took jobs in other fields like construction while they waited out multiple lockdowns. And a number of individuals still need to stay at home with school-age children who haven’t fully returned to in-person classes.
Even before the pandemic, Ruby Elliott, formerly a supervisor at Puesto in La Jolla, California, had mulled the idea of eventually moving out of state with her boyfriend, also in the restaurant industry, so that they could buy a home and live in an area with a more affordable cost of living. They continued working, though, through the pandemic and when they were laid off in December, they made the leap.
They moved to Nashville last month and both have new jobs, but not in hospitality. They’re both now employed in customer service positions — one for a biotech company, the other at a tech startup.
“The No. 1 motivation was cost of living,” said Elliott, 25. “We wanted to buy a house, and it’s impossible to find something in an area you actually like at an affordable price. And 2020 was really hard on restaurants and also workers because they had to change a lot.
“It was just the inconsistency of we’re closed, we’re not closed, we’re only outdoors. People in the industry crave consistency, and instead, there was total unpredictability for many.”
Nicolas Pelaez recognized early on last year that it was unlikely the spread of the novel coronavirus would be short-lived, and so he opted to make a clean break from the restaurant industry in March of 2020. He left behind his job overseeing Modern Times’ multiple tasting rooms and restaurants and took a position as a financial adviser with Northwestern Mutual.
His girlfriend, Maggie Beemon, took up jewelry-making as a hobby when she lost her position as a server. She’s now doing so well that her income from her new vocation is exceeding what she had made in her restaurant job, Pelaez said.
“I’m super glad I made the decision I did,” said Pelaez, 35, who lives in San Diego’s North Park neighborhood. “If everything had bounced back within the first month or two, I could have said I jumped out at the wrong time. From the beginning, we knew we didn’t have the ability to sit and wait. We had to pay a mortgage. If we waited a year, we’d have been a year behind where we’re at now.”
Even as vaccinations rise, there’s still the fear factor to consider. Some restaurant employees, whether working in cramped kitchens or waiting on unmasked diners, worry that they could be at risk of being infected. Assemblywoman Lorena Gonzalez, D-San Diego, says restaurant operators should not be surprised they’re having a hard time finding cooks. She points to a recent UC San Francisco study, which found that among working-age Californians, line cooks had the highest risk of dying during the pandemic.
“Cooks, who are overwhelmingly Latino, made up the highest excess mortality rate of any profession last year — and people wonder why workers would think twice before returning to these jobs?” Gonzalez said. “To build a stronger economy as we recover from the pandemic, it’s time we have a serious discussion about valuing service work and paying workers a living wage.”
When Jeff Motch first began the hunt for employees at his Panama 66 outdoor venue in Balboa Park and Blind Lady Ale House in Normal Heights, he stayed away from offering bonuses, but as his search proved increasingly fruitless, he offered current staff a finders fee of a few hundred dollars if they could refer someone who would eventually become an employee — and stayed. That yielded nothing. Pre-COVID, Motch says he had 50 to 60 employees at Panama, and now it’s about half that.
“Except for our staff at Panama who had been with us for three to nine years, all of our ex-employees disappeared,” said Motch, who will be partially reopening Blind Lady for indoor service this weekend for the first time since last June. “We had a number of people who changed careers. One became an electrician. Some took desk jobs. I have another trying to become a nurse. This is a crazy world and we’re still in uncharted territory, and that will be the case for a while. Lots of us are healthy and vaccinated, but that’s not the case for everyone.”
David Contreras Curiel, whose family-owned restaurant group of nine eateries — including a 10,000-square-foot venue that will open next month in the Gaslamp Quarter — says some locations in the Karina’s Group are 30 to 35 percent understaffed. They’re paying wages approaching $20 an hour for back-of-the-house employees, offering raises to current workers, and shelling out more money for overtime. He wonders if the bonuses and current wage inflation is sustainable.
“People are waiting longer to get a table so our service is taking a hit because of our short staff,” Curiel said. “I know I see it when I go to restaurants. The lines are ridiculous. But we’ll survive no matter what.”
Whether the current labor shortage is a temporary blip on the coronavirus timeline or it portends major shifts in the hospitality sector remains to be seen. Robert Gleason, CEO of San Diego-based Evans Hotels, suspects that the pandemic will, in some ways, forever change the industry. Evans’ three hotels — the Catamaran, Bahia and Lodge at Torrey Pines — have more than 150 open positions in all categories of work.
“I think there is some permanent dislocation,” said Gleason. “There are a number of people who’ve decided to not be in this business here, and there is a certain amount of additional efficiency we’ve figured out that may require slightly fewer people. I think it’s a long-term challenge for the industry, particularly as wages continue to increase.
“That affects what you have to charge for things. People can expect that dining out will get more expensive.”