Celia Garcia, owner of seafood-centric Mexican restaurant La Terraza, is feeling hopeful as the country moves away from pandemic-related restrictions. Still, as Michigan lifts all gathering orders Tuesday, she may opt to slowly ease into full capacity instead due to lack of staff and other factors.
Mostly, she’s thankful that she survived.
“I’m feeling grateful. It’s given me a lot of strength and motivation. We are going to move forward,” she said, adding that she has a lot of friends who weren’t as lucky and had to close their businesses permanently during the pandemic.
The National Restaurant Association estimated that 90,000 businesses have closed in the past year because of the pandemic, which is almost twice as many that might close during a normal year.
Restaurants that survived and are readying to enter the second half of 2021 with zero pandemic-era restrictions are still facing anxiety from severe labor shortages, rising food costs and hard-to-find ingredients. Employees and owners who are working often take on more tasks or a greater variety of duties because they’re short staffed.
Customers may encounter slower service, higher menu prices and unavailable dishes.
In Metro Detroit, restaurants are able return to 100% indoor capacity on Tuesday after nearly 16 months of having some kind of restriction – from zero percent, to 50%, back to zero, then 25% and 50% again – on how many customers can be inside. The restrictions lifting Tuesday were originally set to roll back July 1 but Gov. Gretchen Witmer announced Thursday the changes would be moved up nine days.
On June 1, the 11 p.m. curfew for indoor dining was lifted and tables were once again allowed to have more than six people.
“I am excited. I thought it was going to be the beginning of July but I’m all for it,” said Greg Vartanian, co-owner of Edo Ramen, an Asian fusion restaurant in Royal Oak, adding that he’s “a little bit surprised” that the restrictions were pulled earlier than planned. “I’m very happy also. This is great for people.”
But just because restaurants and bars can open 100%, doesn’t mean they all will. Expect some businesses to continue to have abbreviated hours and possibly fewer available tables, meaning longer waits for a seat, because they just don’t have the staff to accommodate the demand.
You’ve probably seen the headlines. Restaurant owners offering signing bonuses that have been in the thousands to attract new employees. Some are offering benefits for the first time. Even fast food places are offering above minimum wage; a White Castle at Greenfield and Joy in Detroit has a sign promoting $15 an hour.
Garcia says she will slowly extend the hours and capacity of La Terraza. She wants to be able to monitor customers’ reactions and see how much her team, which is short-staffed, can handle.
“I, for example have to take many roles,” she said. “I have to be the hostess, do the prep, basically do so many tasks at once. My servers also take a lot more tables then they usually were assigned but the customers are very patient. They’re grateful and patient.”
‘Astronomical’ food costs mean changing menus
Galloping alongside the labor shortage is the rising price of food. National corporate chains like Burger King and Starbucks to neighborhood diners are having issues with rising costs due to supply constraints and delivery delays.
Gregory Alexiev, executive chef of 5ive Steakhouse, a chic hotel restaurant at the Inn at St. John’s in Plymouth, says his biggest challenge moving forward is staffing, but that the prices of proteins “have gotten astronomical.”
“We have switched to smaller portion sizes and try to do all our own butchery to keep costs in line for our guests,” he said. “There are items I’ve had to take off the menu because the price was too high to continue.”
One of those items is chicken wings, which he says are higher in price now than they were during the Super Bowl and March Madness. Crab cakes also had to go.
“Over the last few months, we have to kind of roll with the punches as products went up in price, “ he said. “It was like playing the game whack-a-mole – you get one thing under control and then something else would pop up.”
Like Garcia, though, Alexiev is hopeful.
“We have not raised prices by more than a dollar or two on a couple items, and for the most part have kept numbers in check. We have toyed around with portion sizes to help keep costs similar to what our guests are used to,” he said.
“I will say business has been good for us … people still want to eat out and for the most part are understanding of the staff scenario. Had to turn away a few guests tonight and it’s not something we like to do, but if we can’t give them the best service that they deserve then we fail before we start.”
The UDSA reported this spring that the price increase of meat and poultry was driven by high feed costs and strong demand both domestically and internationally. Winter storms and drought also disrupted the beef supply.
Garcia is dealing with high costs at La Terraza, too, to the point where she’s taken some seafood items off the menu rather than raise the price alarmingly high. Besides seafood, the cost of imported liquor, red meat and vegetables are also “considerably high.” At the same time, those items are also in demand from customers.
“The clients are very receptive even though the prices are higher,” she said, though she feels, in general, that her customers are patient and have been more generous with gratuity since the pandemic started. “It seems that everybody is a lot more grateful.”
A better work-life balance post-pandemic?
Last year’s lockdown caused many workers to find other income after years of spending 40 or more hours a week on their feet serving food and drink to others. The break forced employees and owners to look at what was and wasn’t working with their restaurants before reopening or going back to work. The break made some decide not to return to those jobs, which is part of the reason for the labor shortage.
“This industry was broken for a really long time,” said Detroit chef Kate Williams. She permanently closed her popular Corktown restaurant Lady of the House in early 2021 and recently reopened her vintage-styled diner Karl’s inside the Siren Hotel after being dark for nearly a year.
“Most of us, myself included, were just used to going, going, going and what the pandemic did for many that I know – that have even left the industry – is just let you take a breath, spend time with your family and realize that you need to figure out a more sustainable work-life balance, which is what we’re creating in the restaurant now.”
She said even before the pandemic her restaurants offered benefits. Williams said she’s not having too much of an issue with the labor shortage partly because they’re ramping up hours slowly and her employees get paid time off, vacation days and health insurance.
“I’m not necessarily worried because the way we decided to do this is in increments, to be able to support the team that we are bringing on and do it the right way,” she said. “I’m not saying we won’t be at 100% capacity seven days a week, but I will say that we’ll figure out how to do that responsibly with our team in support of our team and all the other factors that go on.
“The year of this open and close, open and close, open 25%, open 50% has us all cautiously approaching it,” she said.
While she said no restaurant is immune to the fact that the industry doesn’t have as many applicants as it did in February 2020, she’s not sure offering signing bonuses is a permanent solution to finding staff.
“I think that at least our goal has been getting the right people in and making it so they want to stay, so that’s not a hiring bonus necessarily. It’s repeated sick leave, paid time off, not having to work over 40 hours and all this stuff that is not necessarily standard before the pandemic,” said the accolated chef who has been praised by the New York Times, Food & Wine and other national publications.
Williams is among a few restaurant owners who have decided to make quality work environments a priority. The five area Bobcat Bonnie’s locations are shutting down the week of Fourth of July and the whole staff is getting a paid vacation, for example. Salaried employees at Hazel, Ravines and Downtown in Birmingham get benefits, too.
“Our salaried employees typically work 40-45 hours per week, which is unheard of in this industry,” said chef Emmele Herrold, co-owner of Hazel, Ravines and Downtown, which has mastered pivoting quickly to give customers what they need throughout the pandemic. “You usually see 55 hours or more. If there is a need to work overtime, we pay an hourly wage to make up for that time. They all get vacation and health benefits.”
Williams said one positive thing that may come out of the pandemic is that it’s forcing the industry to change for the better. It may, however, mean higher costs in the future.
“I think the biggest hurdle will still be for us as diners, myself included, is understanding that the prices are going to go up because we should be paying people,” she said. “And it’s not just hourly workers or even salaried working in the space, but also those who are producing the food.”
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