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Are all Restaurants Understaffed now (2021)?


hornian

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Which Republican talking points?
Your denial that  extended UE incredibly impacts the labor market?  That isn't partisan.  That is fundamental economics.
Even in West Texas where more businesses tried to stay open, there are still "Help Wanted" ads and signs all over the freaking place. There are recruiting bounties and signing bonuses all over the board.  Businesses are struggling like hell to get staffed.

West Tx = oil/gas generally speaking? Seems like it’s similar to the service industry folks saying f this, going dif route, never going back to that work… we’ve even seen that on this board.
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17 hours ago, Chopper said:

I didn't and would never compare working in a restaurant to working the coal mines. You seem to love to just make shit up and have a straw-man argument. Maybe that's the only way you can win one. Yes, you can make reasonable cash on a nightly basis waiting tables if you have the right shift at the right restaurant. But typically you can't just walk into a prime job in the restaurant industry without either good experience or a good connection. Additionally you typically have to train for 2 weeks by working without tips. Then they'll put you on the schedule but start you with the least lucrative shifts. Typically no paid leave, sick leave or healthcare. And if you're just starting out, it's really a difficult job to do well. I can recall having nightmares about "being in the weeds" for the first few months on the job. Except for some servers at very successful fine dining establishments, it's a job for people in transition or a 2nd job. Or people who have no better choices and aren't overjoyed to be working in a restsuarant.

Starting a new job can be hard.  Cool story 

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21 hours ago, BabaYaga said:

Their model is rock solid and their efficiency hard to mirror.  Heard a rumor one of the architects of their drive-through efficiency was brought in to Texas Motor speedway to help with their vax lines.  

Their drive thru is fast because they have very few menu options with hardly any variation and they pre make all of their sandwiches.  The real magic is convincing all those people to show up for steamed sandwiches and soggy fries.

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10 hours ago, burns_312 said:

Not exactly sure where this fits but I thought of this thread when I was looking at this menu.
435ee5090874c1bee5935f0e3746b31d.jpg


Sent from my iPhone using Tapatalk

Good real world example of pass-through charges incurred by businesses.  When you artificially raise their cost structure (fixed or variable), guess what - they don't just eat it.  Whether it's taxes, MW, or capex, it filters down to the consumer and ultimately readjusts the baseline.  

Either way "they" don't pay it.  We do.  

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17 minutes ago, Gene Parmesan said:

Their drive thru is fast because they have very few menu options with hardly any variation and they pre make all of their sandwiches.  The real magic is convincing all those people to show up for steamed sandwiches and soggy fries.

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Edited by BabaYaga
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4 minutes ago, huge said:

Also I don't deal in the restaurant industry so I cannot speak to that.  What I can speak to is that jobs in the 15-25/hr range have been VERY hard for us to fill due to extended unemployment benefits.  That is MY experience and nothing more.  If anyone thinks people would rather go to work than sit on the couch for the same money then we live in different Americas.

Pay more

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Some things that seem pretty obvious:

1 -- generous unemployment surely incentivizes some people to stay out of the workforce when their alternative is taking work that doesn't pay a material amount more than UE benefits.

2 -- there are shitload of other factors having a major effect on the labor market, particularly the restaurant industry, where many workers found jobs that either paid more, offered real benefits, better hours, more protection from market vagaries, allowed them to work while caring for their children, and other factors, and/or a combination of some or all of these.

 

I waited tables back in the day.  It was a great job for a student who could work 20-25 hours a week and just put money in my pocket.  As a living, not so great.  The "career" waitstaff and bartenders I worked with had it hard.  If they could get a job with benefits and similar pay, and didn't have them working odd shifts, they'd have likely taken it.

We have a problem in this economy that a sizable percentage of people have worked shit-pay jobs as their full-time "for a living" gig, as opposed to just students making spending money and such.  As many of those service industry shit-pay jobs dried up over the last year, forcing people to find alternatives, many found alternatives that are better (which is actually a GOOD thing), but it exposes a weakness: our economy depends on there being many millions of people who are willing to work shit-pay jobs.  

When those people need to earn a living, and they see a world beyond shit-pay jobs, they aren't going to go back.  This opens up a whole set of issues, most of which we should be able to discuss honestly and objectively, but we can't, so they'll end up in the CR (both here and in society at large), and nothing smart will ever happen to address this weakness in our economy and job market.

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Remove sales tax from food service. 
Raise prices. 
 

Use the 8% increase in revenue to double (or more) the hourly rate. 

*for restaurants under 25 employees 
*random ideas, open to all

It’s a different business models that still provides many good jobs including entry level.  The current model seems unsustainable post Covid without hiring folks off the books. Help make employees cheaper (from taxation) for employers which should allow them more of a safety net to pay a more stable income. 

Edited by ChickenSandwich
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12 minutes ago, ChickenSandwich said:

They pay much more with benefits if you remove the $300/wk subsidy added to state unemployment from Uncle Sam. 
 

Are they even allowed to “time out” of benefits due to Covid?

Ok well they apparently still aren’t attractive enough to convince people to work for them. So it seems like they should try something else.

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12 minutes ago, Brisketexan said:

We have a problem in this economy that a sizable percentage of people have worked shit-pay jobs as their full-time "for a living" gig, as opposed to just students making spending money and such.  As many of those service industry shit-pay jobs dried up over the last year, forcing people to find alternatives, many found alternatives that are better (which is actually a GOOD thing), but it exposes a weakness: our economy depends on there being many millions of people who are willing to work shit-pay jobs.  

When those people need to earn a living, and they see a world beyond shit-pay jobs, they aren't going to go back.  This opens up a whole set of issues, most of which we should be able to discuss honestly and objectively, but we can't, so they'll end up in the CR (both here and in society at large), and nothing smart will ever happen to address this weakness in our economy and job market.

I'll take "What is a Service Based Economy and Price Elasticity" for a $1,000 please

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3 minutes ago, hobbes2702 said:

Ok well they apparently still aren’t attractive enough to convince people to work for them. So it seems like they should try something else.

Is competing with a temporary subsidy (instead of their actual competition) and overpaying only to let people go a year later a good practice?

Edited by ChickenSandwich
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5 minutes ago, ChickenSandwich said:

Is competing with a temporary subsidy (instead of their actual competition) and overpaying only to let people go a year later a good practice?

If you aren’t competitive enough to beat out unemployment benefits then you need to look internally at how you incentivize employees. 

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21 minutes ago, ChickenSandwich said:

Remove sales tax from food service. 
Raise prices. 
 

Use the 8% increase in revenue to double (or more) the hourly rate. 

*for restaurants under 25 employees 
*random ideas, open to all

It’s a different business models that still provides many good jobs including entry level.  The current model seems unsustainable post Covid without hiring folks off the books. Help make employees cheaper (from taxation) for employers which should allow them more of a safety net to pay a more stable income. 

Do you have any idea how much revenue you're asking the Port As and Galvestons to give up?  F&B taxes are the lifeblood of funding those places.

Plus restaurants with fewer than 25 employees are few and far between as they try to keep everyone to under 30-35 hours a week to not trigger overtime and other costs.

Edited by ShaggyBevo RIP
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17 minutes ago, hobbes2702 said:

If you aren’t competitive enough to beat out unemployment benefits then you need to look internally at how you incentivize employees. 

If a small business with a complicated fixed and variable cost structure and often single digit margins can't beat out an entity that can just print money.....you're saying it's the small biz owner to change?  LOL

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26 minutes ago, hobbes2702 said:

If you aren’t competitive enough to beat out unemployment benefits then you need to look internally at how you incentivize employees. 

Semantics, but they are not competing with “unemployment”. They are competing with “unemployment” +40hrs@$7.50/hr (from Covid Sub).

Unless you are suggesting the Covid benefit become permanent?  As well as the remove of any expiration of benefits?

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1 minute ago, elguapo said:

 

Friend of mine in the restaurant industry says he's getting all the applicants they can handle. They all show up to the interview and then never actually take the job. To get unemployment benefits, they have to go to three interviews a week or something like that. Completely working the system. 

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8 minutes ago, ChickenSandwich said:

Semantics, but they are not competing with “unemployment”. They are competing with “unemployment” +40hrs@$7.50/hr (from Covid Sub).

Unless you are suggesting the Covid benefit become permanent?  As well as the remove of any expiration of benefits?

I’m not suggesting anything. I hire at $15 an hour for most positions and have zero issues filling open positions. Something we do is still attracting applicants. The idea that businesses that aren’t micro can’t beat out the current unemployment rates is bullshit. Sometimes you have to adjust to the current labor climate. 

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29 minutes ago, Mitch Cumsteen said:

Friend of mine in the restaurant industry says he's getting all the applicants they can handle. They all show up to the interview and then never actually take the job. To get unemployment benefits, they have to go to three interviews a week or something like that. Completely working the system. 

the interview / apply for UE is based on the honor system. you dont have to do shit but the state agencies have the right to audit that you were actively applying and looking for a job

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1 hour ago, BabaYaga said:

Good real world example of pass-through charges incurred by businesses.  When you artificially raise their cost structure (fixed or variable), guess what - they don't just eat it.  Whether it's taxes, MW, or capex, it filters down to the consumer and ultimately readjusts the baseline.  

Either way "they" don't pay it.  We do.  

almost NO company has absolute pricing power to push cost through the end consumers especially in industries where end customers are very price sensitive (e.g. fast food)

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1 minute ago, LABEVO said:

almost NO company has absolute pricing power to push cost through the end consumers especially in industries where end customers are very price sensitive (e.g. fast food)

Like I said.  Price elasticity.  So if their cost structure goes up to untenable levels, they have to cut their fixed costs, ie, overhead staff.  

That being said, arguing about "absolute pricing power" ignores the middle, mainly that in the immediate you can and will see price increases passed on to the consumer to the extent that they can.

In the end, it's one agency with a budget trying to compete with one without.  We all know how that turns out.  

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6 minutes ago, Enchubben said:

Is economics no longer a required course at UT? WTF people

What's the over/under on someone to tell these companies to "sell more stuff" so they can make more money and be able to pay more to their people....

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Hey sometimes an industry just sees a massive sea change that creeps up on people, just ask the old line packers and their highly paid union work forces that disappeared 40-50 years ago. Smaller generational cohort, and competition from other jobs, may not leave enough of a work force for the current food service base. 

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16 minutes ago, Chopper said:

Looking at the timestamps on most of these posts, those mad about some people not working, for whatever reason, are either fucking off on the job or they don't work.

A Surly tradition back to ShaggyBevo days 

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6 minutes ago, Royalfan5 said:

Hey sometimes an industry just sees a massive sea change that creeps up on people, just ask the old line packers and their highly paid union work forces that disappeared 40-50 years ago. Smaller generational cohort, and competition from other jobs, may not leave enough of a work force for the current food service base. 

This is all true, but in this current case, we are pointing at a clear market distortion in the form on federal printed money - creating a disincentive for many sectors, not just food/beverage.  

This is very different from creative destruction or paradigm shifting innovations.  

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3 minutes ago, Js1 said:

A Surly tradition back to ShaggyBevo days 

Having the privilege to lay around the house, call out for delivery, work (or not) and blast everyone else as lazy mf'ers takes a special kind of tool. Same motherfuckers no doubt extremely stingy with a tip.

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5 minutes ago, BabaYaga said:

This is all true, but in this current case, we are pointing at a clear market distortion in the form on federal printed money - creating a disincentive for many sectors, not just food/beverage.  

This is very different from creative destruction or paradigm shifting innovations.  

You know what was paradigm shifting and distorting? The pandemic. You know it's not over yet, right?

Also point me to one post of yours expressing concern about subsidies for business owners to keep afloat during the pandemic.

Edited by Chopper
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Just now, Chopper said:

Having the privilege to lay around the house, call out for delivery, work (or not) and blast everyone else as lazy mf'ers takes a special kind of tool. Same motherfuckers no doubt extremely stingy with a tip.

what the fuck are you talking about

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Just now, Chopper said:

You know what was paradigm shifting? The pandemic.

Exactly, people shifted their habits, and became less tolerant of certain things. People who thought they'd never do anything else for work, found that they liked something else better. It doesn't take a big shift percentage wise in the amount of availability to lever into a much bigger shift, and trying to pin it all one thing isn't going to reverse changes.  

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This is all true, but in this current case, we are pointing at a clear market distortion in the form on federal printed money - creating a disincentive for many sectors, not just food/beverage.  
This is very different from creative destruction or paradigm shifting innovations.  

Nobody here is denying that it’s a factor.

We’re just looking at the full picture, and see that there are a lot of factors, including several that are strong and compelling.
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1 minute ago, irishtexan said:

Perhaps - and I'm just spitballing here - a business model in which you can't afford to make a profit unless you rig the system to pay your employees 1/4 of the minimum wage without benefits, but then struggle to attract or retain employees, is a flawed business model. 

 

Ding ding ding

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9 minutes ago, irishtexan said:

Perhaps - and I'm just spitballing here - a business model in which you can't afford to make a profit unless you rig the system to pay your employees 1/4 of the minimum wage without benefits, but then struggle to attract or retain employees, is a flawed business model. 

 

It is, because it doesn't exist on a large scale and would have gone out of business even pre-pandemic. 

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Regarding food service compensation, for many people it was a great option.  This may sound crazy on a board filled with college graduate professionals, but for many folks it is/was true.  For example, one of my best employees was a young woman who was an immigrant from Mexico (came over several years before I met her).  She could speak English but had a strong accent and was a bit self conscious about it; her reading and writing skills were not great.  She was such a hard worker that I tried to promote here to manager several times.  But she absolutely hated the responsibility, managing inventory, writing emails, pretty much any organizational task would stress her out to no end.  So I left her as bartender, which was really what she wanted.  I paid her $15/hr and with tips she would make $50k per year.  This was more than double than what she made at any previous job.  And she was very good at the job, customers loved her, and she genuinely seemed to enjoy it (as much as anyone enjoys a job, at least).  She worked for me for about 6 years and then had to move out of state for family reasons.  She still calls and texts me and wants to make sure that whenever she comes back to Texas, we still have a job open for her.

I have a tremendous amount of respect for her as a person and a worker and think she is very talented.  But talents and aptitudes come in a large spectrum and not everyone is well suited for corporate gigs.   In what other industry is a 25 year old, non-graduate, English 2nd language worker with limited writing skills and who hates administrative tasks going to make $50k/year?  There are many stories about restaurants and others in food service industry who take advantage of staff, but the whole industry is not like that and for many workers they took the job for the same reason anyone takes a job, and that is because overall they perceive it as the best option for them.  Now if they go on to things that are better fits for them and their families, I am very happy for them.  I’ve even written several letters of recommendation for staff when applying to new industries.  I only want staff if it is mutually beneficial.  The whole industry is not predatory, and many local restaurants genuinely care about their staff as people and professionals. 

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49 minutes ago, Brisketexan said:


Nobody here is denying that it’s a factor.

We’re just looking at the full picture, and see that there are a lot of factors, including several that are strong and compelling.

Of course, but one can be solved with the flick of a pen.  

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38 minutes ago, irishtexan said:

Perhaps - and I'm just spitballing here - a business model in which you can't afford to make a profit unless you rig the system to pay your employees 1/4 of the minimum wage without benefits, but then struggle to attract or retain employees, is a flawed business model. 

 

Or perhaps you take a more nuanced approach to their "base" and reconcile take home amounts vs those in a fixed wage.  Further, also revisit this notion is some inherent flaw in their model as it is impacting many more sectors than just food/beverage.  It's any wage at or under $20-$23hr.  

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39 minutes ago, synoptic said:

I have a tremendous amount of respect for her as a person and a worker and think she is very talented.  But talents and aptitudes come in a large spectrum and not everyone is well suited for corporate gigs.   In what other industry is a 25 year old, non-graduate, English 2nd language worker with limited writing skills and who hates administrative tasks going to make $50k/year? 

My last job was essentially R&D for a company that grew up around an invention myself and 3 others conceived.  However, I spent a lot of time trouble-shooting problems on the manufacturing line, and I can easily name two dozen English-as-2nd-language guys with nothing but a HS diploma (or GED) who were pulling ~ $30/hr.  It wasn't "manual" labor in the sense it required no skill, but it was definitely hands on and demanded little more than common sense with assembly tools (wrenches to soldering irons) or test equipment.  It's certainly possible to build a respectable career without having to sling hash for a living.  (That said, I suppose the partial cash compensation in the food industry does help a bit on taxes, but I wonder how big an effect that really is?)

As others have pointed out, the pandemic incentivized a good portion of restaurant workers to find alternative careers like I'm alluding to, and once they land, they're not likely to give it up.  Stable hours, stable paycheck . . . tough to argue with.

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3 hours ago, hobbes2702 said:

Pay more

These businesses have often been shut down part of the last year and are barely getting by...   But a lot of y’all’s solution is just pay more, you know how I know you don’t own a business?  

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20 minutes ago, jimmyjazz said:

My last job was essentially R&D for a company that grew up around an invention myself and 3 others conceived.  However, I spent a lot of time trouble-shooting problems on the manufacturing line, and I can easily name two dozen English-as-2nd-language guys with nothing but a HS diploma (or GED) who were pulling ~ $30/hr.  It wasn't "manual" labor in the sense it required no skill, but it was definitely hands on and demanded little more than common sense with assembly tools (wrenches to soldering irons) or test equipment.  It's certainly possible to build a respectable career without having to sling hash for a living.  (That said, I suppose the partial cash compensation in the food industry does help a bit on taxes, but I wonder how big an effect that really is?)

As others have pointed out, the pandemic incentivized a good portion of restaurant workers to find alternative careers like I'm alluding to, and once they land, they're not likely to give it up.  Stable hours, stable paycheck . . . tough to argue with.

For sure there are others out there making similar money in other industries; didn't mean to imply that it wasn't possible, just that the food service industry was a good/better option for many folks with certain skill sets.  Also, I would argue that those technician's skills extend beyond common sense and not everyone could pick it up with ease or would be well suited for it.  Also, the world's demand for that is only so many people, so having a range of industries with decent compensation is still beneficial.


As for pandemic driving food service workers to find more stable jobs/careers, I completely agree.  Really my point was that the food service industry for many years provided millions of workers with certain skills at certain points of their life better compensation than many other jobs.  Maybe that has all changed and other industries provide better options now.  If so, I think this is great for those workers and hope they are better off.  

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38 minutes ago, Hook1997 said:

These businesses have often been shut down part of the last year and are barely getting by...   But a lot of y’all’s solution is just pay more, you know how I know you don’t own a business?  

Shut down by their own government and are now directly competing against their endless money printing press, and the solution is just to "be better"

JFC....

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17 minutes ago, BabaYaga said:

and the solution is just to "be better"

JFC....

Yes, very much so! JFC if you think restaurants can't find adequate staff because of unemployment benefits then you fundamentally do not understand the root problems in the industry.

The staffing issue was a well-known and widely-discussed problem before Covid struck. Staffing shortages were widespread in Austin because of low-pay, long or undesirable shift hours, and a glut of industry jobs due to the glut of establishments operating across the area. The overwhelming norm in the industry was to pay employees shitty wages and treat them as disposable employees who could be easily replaced. For most restaurants, employee retention was increasingly difficult because the industry norm is to not offer adequate pay, benefits, or stability yet expect loyalty just because you gave someone a job. Unless you're a salaried employee you won't get sick days, you're expected to work even when sick, you aren't offered paid vacation, and you aren't offered a 401k plan. It took the ACA to mandate employee health insurance offerings ferfucksake! And if you are a salaried employee, those benefits come at a price of very long hours for modest pay that employees in other sectors would balk at. When covid hit it just reminded restaurant employees who were already used to being overworked, underpaid and/or treated like shit by ownership, management-- and most of all the general public--how valued they weren't. Now that they need employees to fill their open positions, instead of pointing the blame at the unemployment insurance system they would do well to remind themselves of the money they received in PPP loans and then take a long look at their operational procedures, pay structure, benefits, and company environment and learn from past mistakes. 

 

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2 minutes ago, irishtexan said:

Look, this is much more complicated than "people are lazy" or "pay employees more." As a pinko lefty weirdo, even I will admit that it's past time to start scaling back and establish limitations on unemployment benefits. They can't be perpetual and unrestricted. Hopefully that will incent some folks to reenter the labor pool. But since COVID more than 2 million workers have basically removed themselves from the labor pool and instead opted to be a stay at home parent, retire early, etc. And as many on this thread have pointed out, many of those working in service jobs or in other fields that were critically disrupted by Covid have changed careers. I personally know multiple people who worked in food/bar/service/entertainment who have done so. Employers are going to have to be more competitive if they want to fill these positions with qualified people.

Which goes back to the point that some people seem to be making, and some employers believe - which is that employers have some inherent right to cheap labor. They don't. The restaurant industry is a microcosm of that greater labor shortage. Good restaurants that are busy and treat their employees well will have no problems finding qualified servers and bartenders and kitchen staff. Shitty restaurants without customers that treat their service staff like indentured servants will struggle to hire and retain qualified servers and bartenders and kitchen staff. And they will fail. That's the way it's always been. It's just amplified by a labor shortage and an entire industry's labor pool that was forced to adapt, many of whom moved onto other opportunities.

And we, as customers, may need to accept that we don't have an inherent right to cheap food prepared by trained chefs, taken care of by friendly, thoughtful and attentive servers. The future of the industry seems very unclear at this time. Maybe it'll all "go back to normal" in the third and fourth quarter of this year. Or maybe there will be fewer restaurants that cost more money, but will be of higher quality. Who fucking knows. 

Good post.  I certainly think that it's time to dial back UE benefits.  But I'm certain that will only make a dent in the overall issue, for all of the other reasons you note.

 

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