A fast food hiring spree across Southern California has put overall restaurant employment near pre-pandemic strength.
My trusty spreadsheet, filled with state job figures, found 631,500 at work in August at all types of restaurant businesses in Los Angeles, Orange, Riverside and San Bernardino counties.
Restaurants restaffing from the coronavirus chill added 40,700 workers in 12 months, or 6.9% growth — nearly triple the average 2.4% yearly pace since 1990. Two-thirds of the recent hiring surge came at quick-service eateries.
Restaurant owners juggled myriad issues during the pandemic era including business restrictions, reluctant diners and shortages or soaring prices of key ingredients and labor. It added up to 274,000 restaurant workers losing their jobs — or 43% of all staffing.
Yet dining out trends often mirror the broader economy. Restaurants may only account for 8% of all local jobs, but their hiring swings say a great deal about the local consumers’ psyche.
So, it’s a sign of economic confidence that Southern California restaurants are at 98% of August 2019 employment, just 10,800 short of full recovery.
Sliced by service
It’s been a very different rebound for the region’s fast-food joints vs. their full-service brethren.
For starters, the lockdowns of 2020 hit sit-down dining harder. Full-service eateries initially lost 195,000 workers or 65% of staff compared with 79,000 cut at fast food, a 23% drop. As the economy reopened, quick-serve restaurants fit many more needs in the pandemic era.
Fast food’s portability was great for on-the-go dining or delivery. Outdoor dining areas at quick-service sites made some diners more comfortable. Also, fast food’s lower price point was attractive as household budgets got pinched by the coronavirus’ economic fallout.
Quick-service eateries had 358,300 local jobs in August, 5% above pre-pandemic figures in August 2019. The revival added 27,200 workers in a year or 8.2% growth — triple the historic hiring pace.
Sit-down restaurants often do best in urban centers where workers congregate. But a modest return by workers to traditional offices has been a drag on full-service eateries.
Full-service eateries had 273,200 workers in August or 9% below pre-pandemic jobs. That’s after staffing expanded by 13,500 in a year or 5.2% growth.
Or ponder the industry split this way: fast food jobs hit a record high in July while full-service is at 2014 levels.
Now, let’s contrast restaurant rebounds with other key Southern California employment niches.
Only one hiring spree topped fast food — transportation/warehousing firms have 23% more workers than before the coronavirus. Jobs in healthcare and social services are up 5% vs. August 2019; business-service work is up 3%; jobs in retail and real estate/construction are flat; manufacturing is 4% below; entertainment and recreation are down 8%. Hotels are off 19%.
Price points
The restaurant industry’s long-running growth, minus the coronavirus period, has created opportunity and controversy.
Southern California restaurant jobs grew 74% in 2000-19 — more than triple the region’s overall employment expansion. Those 270,000 new jobs at eateries were 18% of the region’s hiring in those two decades.
But the dining industry’s low pay raises questions about the quality of the regional economic growth — and fairness to the restaurant workers. Industry wages run 43% below the region’s overall average wage, according to one federal pay index.
All those “Help Wanted” banners in the pandemic era meant average wages at Southern California restaurants grew rapidly — up 31% in three years to $18.07 an hour in March. Note this period did have a $3 an hour increase in the statewide minimum wage to $15 for most employers.
Still, that hike looks large — and the pay looks low — compared with the typical Southern California hourly wage, which has seen a 16% jump since 2019 to $31.91.
The higher pay is one reason menu prices jumped. Dining out is 19% costlier in three years in the Inland Empire and 13% pricier in L.A.-O.C., according to the Consumer Price Index.
Coronavirus gyrations didn’t cool the state’s political labor battles.
California just created a Fast Food Council that will regulate working conditions and raise wages to as high as $22 an hour. But the restaurant industry has filed paperwork seeking a voter referendum on whether this law should be overturned.
Mapping the gaps
Geography also divides the restaurant recovery.
The Inland Empire’s overall economy boomed, with overall employment 8% above pre-pandemic levels. Restaurant employment in Riverside and San Bernardino counties followed along …
All restaurant staffing: 145,800 workers in August — 10% above August 2019.
Fast food: 91,800 jobs — 13% above pre-pandemic level.
Full-service: 54,000 jobs — up 7% in three years.
In Los Angeles County, the mild restaurant rebound mirrors a meek overall economic revival …
All restaurant staffing: 343,400 workers in August — 7% below August 2019.
Fast food: 191,000 jobs — 1% above August 2019.
Full-service: 152,400 jobs — down 16% in three years.
In-between, performance-wise, was Orange County …
All restaurant staffing: 142,300 workers in August — 1% above of pre-pandemic level.
Fast food: 75,500 jobs — 6% above pre-pandemic level.
Full-service: 66,800 jobs — down 4% in three years.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
Source: Orange County Register
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