Among all the layoffs at tech companies and banks, layoffs at restaurants are barely a plink-plink-plink dropping in the unemployment bucket. Restaurant employees, after all, often work more than one job and variable hours, and turnover is extremely high. It's not one of those made-for-Hollywood scenes when restaurants lay off employees (with the conference room filled with HR consultants and stacks of separation agreements); the picture looks more like gradual reduction in hours until one day you're just not on the schedule. Or, one cocktail waitress at this location, a hostess at the other location, handing in their aprons and their time cards. Perhaps it's just that applicants for empty jobs never get a call back, no matter how awesome their experience.The Wall Street Journal today evaluates a report that jobs at food service establishments have decreased for five months in a row, and says waiters and waitresses are earning less in tips. Once-darlings of Wall Street, Brinker International (NYSE: EAT)'s Chili's and Starbucks (NASDAQ: SBUX) have seen many outlets close. To blame: it's the economy, naturally, with patrons eating out less, downscaling to fast food for family nights out, ordering less expensive food, and reducing tips from 20%-plus to exactly 15%. Adding insult to injury is the half-of-minimum-wage pay that servers and bartenders are paid in many states: it's been $2.13 an hour since I graduated high school (I can still remember the ignomy when my $21 weekly paycheck from the little Lexington, Virginia pub where I worked in college bounced -- that's how you know your employer is struggling!).
These aren't good times to work in the restaurant industry, or invest in anything but the bare-bones-est of eating establishments.
Looking back on the last several decades of eat-ertainment, it's clear that this wild ride was doomed, eventually, to end: as ex-urbs were developed to meet the seemingly bottomless appetite of Americans to borrow from their rising home values and future earning potential for a good time eating out with sizzling skillets, frou-frou blender drinks, and immense brownie desserts, the pendulum only had so far to swing. I, for one, don't believe the happy days are coming back for fast casual restaurant chains, and would stay away from the stock of Brinker, Darden and friends: permanently.
Oh, and if I were a waitress? I'd expand my skillset. Learn how to fix bikes, or install solar panels, or become a credit counselor. Just an idea...











Reader Comments (Page 1 of 1)
12-10-2008 @ 8:20PM
William Peale III said...
I'm server at Chili's in Tennesssee. And I have seen the gradual incline of my tips since this recession. I'm starting to look for another job. If I had the money to go to school I would...buts that no excuse...but this something I have to face and move on...
12-11-2008 @ 2:15AM
Kent said...
Restaurants more I think about it are cutting back on their personnel. I decided to skip lunch at the restaurant when I refused seating at a table that wasn't bussed yet. It happened today at the Hilton in Las Vegas of all places. Las Vegas is hurting also. I rarely eat out anymore unless it's business.
12-11-2008 @ 8:42AM
kevin said...
Restaurant jobs are truly the worst. Low pay and most customers who have never been in the business will dog you, thinking thats the way to get service.
12-11-2008 @ 9:38AM
MyKisa said...
where will the cooking oil come from for our home made bio-fuel systems? lol
12-11-2008 @ 9:44AM
KS said...
This is so true. I also work at a Chilis in Ohio, and business is way down. Been at this location for 7 or 8 years, worst I have ever seen it. Usually we are excited about the Holiday season, but this year it's been a bust. Small tips, and very slow. Not many people coming out.
12-11-2008 @ 9:45AM
tom said...
Everybody else is cutting back. Just wait until the senate turns down the auto loan. Lots more people will be out of work. And the recession continues and deepens.
12-11-2008 @ 10:11AM
BHarrison said...
My son-in-law who has never used his decade old masters degree in international business opted for a waitering (server) position at an upscale major resort hotel.
His position was that his "quality of life" of having a flexible work schedule and time off for the family was more important that developing a business career. The decade old master's degree have "depreciated" to having a "zero market value"; and his "upscale waitering job" certainly doesn't provide a "skill set" for alternative employment as the bottom drops out of the restaurant market.
It is all about "choices" that people make. The only good point is that the kids don't have any excessive indebtedness. They have a modest mortgage, and pay off the credit card charges every month. The question is: "What will they do if the "upscale waitering job plays out?"
The value of education and experienced skill sets cannot be overstated. Where does a "server" seek employment in these economic down times?
12-11-2008 @ 1:14PM
brandon frye said...
I think articles like this are the real problem we are having right now. If people like this lady would just stop printing dumb stuff like this people wouldnt be as freaked out. The restaurant business is permanetly done, did she really say that, this lady is nuts. The housing market goes down and people started to conserve but when the stocks started to tank that is when things started getting really bad. BUT!! what does she think is going to happen when the stocks come back up and the housing market starts to recover? For anyone to believe that the markets arent going to come back you have been brainwashed by people like this lady and the news who we know always make things worse COME ON!!! Im telling you when the stock market starts coming back, and it will be soon, that it is going to shoot up so fast people will be back to thinking their rich again and spending money. Act like adults people and relax!!!
12-11-2008 @ 10:54AM
MIKE said...
GOOD TRY BRENDON FRYE.....YOU CAN'T MAKE SOMETHING OUT OF NOTHING....THE STOCK MARKEY IS NEVER GOING TO COME BACK....PROMISES WERE MADE AND NOT LIVED UP TO....I DON'T CARE WHAT HAPPENS, PEOPLE WILL NEVER INVEST IN STOCKS THE WAY THEY ONCE DID....THE COMPANIES THEY INVESTED IN (NO MATTER WHAT THE INDUSTRY WAS) ALL SHIT THE BED AND LEFT THE STOCK HOLDERS "SCREWED"....ASK YOURSELF ONE SIMPLE QUESTION....WILL YOU EVER BELIEVE ANYHING YOUR STOCKBROKER TELLS YOU EVER AGAIN ??? ARE YOU THAT NAIEVE ?
12-12-2008 @ 6:32AM
me said...
Yeah lets kick the smokers out, We haven't been to a resturant since the no smoking ban went into efffect in ohio and won't.
12-11-2008 @ 11:11AM
VH said...
I think you are being a bit harsh with your son-in-law...my husband
has been a waiter for 22+ years now and earns more than 6 figures a
year--the fact is if you work at a truly upscale dining
establishment you only see a decline in the clients that only come in
for "special occasion" events --and they never tip well because they
can't afford to go to these places on a regular basis-- (they would never spend 600.00 to 1500.00 for a bottle of wine...)The truly
weathly are still dining out and tipping well...the fact that your
son-in-law values his family more than a mid-level corporate job
should impress you--you could encourage him look for a job in an very
upscale restaurant--resorts are too seasonal and do not offer a "call
party" base that's needed to earn a great salary--by the way we have
3 children ages 15, 11 & 8 live in an upscale neighborhood...if my
husband ever does need extra money he is always able to pick up an
extra shift here and there...
12-11-2008 @ 11:18AM
mom said...
If some of the restaurants would cut the portions in half and charge half as much we would all be healthier and could afford to go out and eat.
12-11-2008 @ 11:36AM
brandon frye said...
I will def be investing in stocks again, you pretty much have to if you want to make a decent return on investment overtime. Of course if you look at it today things look like crap but this cycle is supposed to happen and will happen again, MIKE it is called life, we can all either cry about it or accept it will we continue struggling for a while until it all get worked out like it always does. Im done crying!!!!!
12-11-2008 @ 12:08PM
Diamond said...
Let's keep it real people. I've been in the business for 17 years from the back to the front of the house and yes the economy is taking it's toll on every industry. But, the business that chose me has always been good to me for the most part. Yes, tips are down and so are sales for those places that don't know how to market and reinvent themselves in these troubled times. The fact is that when times are hard people still need some sort of outlet socially to escape their problems and the bar and restaurant industry still provides just that. We like to gather with friends and family over a nice meal or have a drink and celebrate our good times or mull over our bad ones... All I 'm saying is don't give up on us yet because along with the upcoming economy rebound charged by President- Elect Obama, there will be a rebound in hospitality.
Peace
12-11-2008 @ 12:09PM
Jon said...
Welcome to the GOP BUSH CHENEY RUMSFELD OIL Inc. trickle down DEPRESSION ... ENJOY IT and at the next election FIRE every last GOP politician in office!!!
12-11-2008 @ 12:23PM
JILL said...
I EAT RAMEN NOODLES EVERDAY FOR LUNCH IT IS 4 CENTS A DAY I AM RELLY SICK OF THEM BUT I DID LOSE WHIGHT I AM DOWN TO ABOUT 100 LB
12-11-2008 @ 1:40PM
KAYEL said...
well my experience in the restaurant and catering business is the only thing really hiring is temp agency looking for server cause it easier to pay on a need to need base but even there opportunities
2-25-2009 @ 9:11PM
Zohar said...
Check out www.serversunite.com There are still servers making great money, despite the economic down turn...