Breaking Down the Cost of Seasonal Hiring
Restaurants are expected to add a whopping 490,000 seasonal jobs this summer, according to the National Restaurant Association.
Hiring seasonal employees is a critical aspect for many restaurants, especially during peak seasons. From May through September, there’s a significant bump in the industry: restaurants are able to increase capacity by adding more outdoor seating, more tourists are traveling the country, and people are just more likely to go outside when it’s warmer.
This article will look at the financial impact of hiring and training seasonal staff and explore solutions to offset these costs so you can cost-effectively attract and maintain top talent during the summer slam.
What Is Seasonal Employment?
Seasonal employment refers to temporary jobs created by businesses to meet increased demand during specific times of the year. These roles usually have a predefined contract period from a few weeks to a couple of months.
In the restaurant industry, seasonal employment is all about keeping up with the ebbs and flows of customer traffic throughout the year. Restaurants tend to get busier from May through September for the summer rush, which is when they bring on extra staff to provide a smooth experience for diners and maximize profits.
How Long Is Seasonal Employment?
The typical seasonal employee works for anywhere from a few weeks to a few months, with an average employment of about three months.
What Is the Cost of Hiring and Training Seasonal Employees?
Many restaurant owners and managers vastly underestimate the costs of hiring and training new employees. The Society of Human Resource Management estimated that it costs employers about $4,100 to hire a new employee – but that’s across all industries and job types. What about restaurant workers in particular?
FreshCheq estimates that it costs owners and managers somewhere around $1,700 to hire a low-level employee in the restaurant industry.
Why is this number so high? Let’s break it down by each step in the hiring process, from recruiting to training:
Recruiting
Many job boards require you to sign up and pay a fee in order to post on their website. Monster and ZipRecruiter, for example, cost anywhere from $100-$400 per post and $200-$700 per month to maintain a membership. Even if you strictly use free job posting websites like Indeed, you still need to spend anywhere from 3-5 hours crafting the job description and sifting through applicants. Time loss is a phantom cost, so this needs to be factored into the bottom line in order to get an accurate idea of how much it actually costs to onboard an employee.
Total Cost: $500-$1,200
Interviewing
Restaurants and bars have the shortest time to hire new employees at just 10.2 days, according to data from GlassDoor. However, owners and managers still need to spend 3-6 hours conducting interviews before making a hiring decision.
Total Cost: $100-$250
Onboarding and Training
Finally, 2 in 5 HR managers spend at least 3 hours onboarding new employees. After onboarding, a manager, assistant manager, or fellow employee then needs to spend time training that employee.
The actual time costs of training are difficult to quantify. Not only is an existing, already productive employee taking the time to teach a new employee, but that new employee is also on the clock (and, unfortunately, often making mistakes that cost the restaurant at least some money). The total training time also varies depending on the restaurant and their processes.
Total Cost: $400-$1,500
The Impact of Hidden Costs
Our cost breakdown above mainly looked at productivity loss as a result of recruiting, interviewing, and onboarding a new employee. Other hidden costs, like administrative expenses, vary depending on the existing programs that you use to facilitate those processes. Push Operations’ all-in-one software helps managers and restaurant owners cut back on these expenses and streamline the hiring process. While hiring a new employee will never be free, software can help you eliminate massive productivity loss and get back to what matters most.
What Are the Challenges in Finding Talent for Seasonal Positions?
Filling seasonal roles can be tough. You're competing with other businesses for a limited pool of workers, often needing to attract them with short-term positions and potentially lower wages. On top of that, the tight time frame to recruit, interview, and train can make finding qualified candidates even more difficult.
However, 2024 is shaping up to have one of the strongest and largest labor forces yet in key demographics. The number of 16-19 year olds in the restaurant industry has reached a 15-year high, and the number of older, more experienced workers is also continuing to climb.
How Can Restaurants Offset the Costs of Hiring and Training Seasonal Employees?
Restaurants can take several steps to lessen the financial burden of onboarding seasonal staff, including using online applications, employee referrals, and improving retention.
- By utilizing online applications and pre-screening questions, you can streamline the initial phase, saving time and resources.
- Additionally, current staff can be an untapped goldmine for finding new staff. Offer incentives for recommending qualified candidates to existing employees. They’ll be able to prepare friends and acquaintances for the position.
- Finally, focus on improving retention rates. While seasonal positions are temporary, consider offering competitive wages and flexible scheduling. By creating a positive work experience, you increase the chance seasonal staff will return for future busy periods, reducing the need for constant retraining.
Conclusion
While summer brings a boost in business, restaurants also face the question of how to best manage the financial considerations of hiring and training seasonal staff, typically from May to September. In this article, we’ve explored the significant costs associated with onboarding new employees, including recruiting, interviewing, and training, totaling anywhere from $1,700 to more than $4,000 for each new hire.
If you’re looking to cut back on seasonal hiring expenses, Push’s hiring and onboarding software can help you automate and streamline the process, leaving you time to focus on what matters most – serving up success. Book a demo today to experience the power of an automated hiring and onboarding system.
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