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Restaurants Must Adapt to Shifting Labor Market · Choppin’ It Up by Bloomberg Intelligence

0:21
Speaker 1: Welcome to Chopping It Up.
0:23
Speaker 2: I'm your host, Mike Hallon, the senior Restaurant and Food
0:25
Speaker 2: Service analyst at Bloomberg Intelligence. Today we're joined by Vivian Wang,
0:30
Speaker 2: the founder and CEO of Landed. Welcome to the pod, Vivian,
0:34
Speaker 2: thanks for having me.
0:35
Speaker 3: Excited to be here.
0:36
Speaker 2: Yeah, I'm pumped to do this, looking forward to it.
0:40
Speaker 2: Let's jump right in. What are you in the team
0:43
Speaker 2: at Landed do for your clients?
0:45
Speaker 3: Sure?
0:46
Speaker 4: So, we're tackling the number one challenge facing the restaurant industry,
0:49
Speaker 4: which is labor. So we help source that, engage screen
0:54
Speaker 4: candidates from team members up to managers.
0:57
Speaker 3: So some of our clients range.
0:58
Speaker 4: From McDonald's and Kava all the way to the Michael
1:03
Speaker 4: Minna Group and invited club corps. So we really run
1:07
Speaker 4: the whole gamut and and really just the goals to
1:11
Speaker 4: get people staffed.
1:13
Speaker 3: Super simple goal.
1:14
Speaker 2: There and is it GM's houries both both.
1:20
Speaker 3: We call it everything within the four walls we can do.
1:22
Speaker 2: Okay, cool, Talk a little bit about what inspired you
1:26
Speaker 2: to start the company.
1:28
Speaker 3: Sure, so, I'll take it back.
1:31
Speaker 4: So, my parents actually immigrated to the US from China
1:35
Speaker 4: and their first two jobs are being a dishwasher and
1:36
Speaker 4: a waitress in Ohio.
1:39
Speaker 3: That's where I grew up, and so.
1:40
Speaker 4: I kind of grew up in like the craziness of
1:44
Speaker 4: that of restaurants. It's super fun and I kind of
1:48
Speaker 4: got hooked on it, you know, like once you're in it,
1:50
Speaker 4: you just you love the chaos. Now fast forward a
1:54
Speaker 4: little bit. I was in college, and when I was
1:57
Speaker 4: in college, it was during the rise of the gig economy.
1:59
Speaker 4: So at Princeton, I studied public policy and one of
2:02
Speaker 4: the things that we were looking at was economic policy.
2:04
Speaker 3: You know, what is the gig economy. It was a
2:06
Speaker 3: completely new.
2:07
Speaker 4: Concept at that time, but you had companies like uber Lyft,
2:11
Speaker 4: DoorDash basically taking the labor model and turning out its head.
2:14
Speaker 4: So I was looking closely at that, trying to understand, Okay,
2:17
Speaker 4: the people that are supporting these gig economies, the workers,
2:21
Speaker 4: you know, where are they coming from, what is the
2:24
Speaker 4: life path for them? So those were all like just
2:27
Speaker 4: ideas that were swirling on in my head. And so
2:31
Speaker 4: let's park that that was going on. I have the
2:33
Speaker 4: restaurant experience. Now, right before I started landed, I was
2:37
Speaker 4: actually working in retail. I was working at Gap Inc.
2:40
Speaker 4: With the CEO there on a bunch of different initiatives,
2:43
Speaker 4: one of which was our labor because if you have
2:45
Speaker 4: turnover in your stores, then ultimately you're not necessarily delivering
2:50
Speaker 4: the best customer experience that you could be. And this
2:53
Speaker 4: is something that every single brand I talked to is
2:55
Speaker 4: thinking about. So what we did is we kind of
2:57
Speaker 4: overhauled the system of how we did hiring and I
3:01
Speaker 4: took a lot of those parts. And not every company
3:03
Speaker 4: has the resources of like a GAP Inc. But every
3:06
Speaker 4: company has the same labor challenges, whether it's at like
3:09
Speaker 4: the micro scale of a single coffee shop or a
3:13
Speaker 4: regional ten location pizza shop, or it's a multi hundreds
3:17
Speaker 4: of location enterprise.
3:19
Speaker 3: So I'm all.
3:21
Speaker 4: Those things kind of came together and that's why we decided,
3:24
Speaker 4: you know, we're building this the easiest way for restaurants
3:27
Speaker 4: to hire and the easiest way for candidates to find
3:30
Speaker 4: a job that's actually the best fit for them. And
3:32
Speaker 4: then beyond that, what we're thinking through is like, how
3:34
Speaker 4: can we support those candidates from a finances perspective? So
3:38
Speaker 4: after somebody comes in the second question is how do.
3:41
Speaker 3: We retain them?
3:43
Speaker 4: So different things thinking there are a bunch of different
3:46
Speaker 4: topics there that can dive into, like how do people
3:49
Speaker 4: pay their bills? How do people get paid, how do
3:52
Speaker 4: people save, how do people get access to credit? Those
3:55
Speaker 4: are the types of things that we're going to be
3:56
Speaker 4: tackling next and then finally upskilling. So I call it
3:59
Speaker 4: the line Livelihood platform because livelihood is not just a job,
4:03
Speaker 4: but it's also your finances, it's your education, and there's
4:05
Speaker 4: a lot of stuff for us to do in all
4:07
Speaker 4: those different categories.
4:10
Speaker 1: Awesome. So when was the last time you were in Princeton.
4:13
Speaker 3: I think I went.
4:14
Speaker 4: I go to reunions almost every year, so the reunions
4:18
Speaker 4: are always in May, and basically you enter the orange
4:22
Speaker 4: bubble we call it, and you have you have joined
4:25
Speaker 4: a an orange cult. Everyone's wearing tiger printed things or
4:30
Speaker 4: orange things. It's such a fun time.
4:32
Speaker 1: That's cool. Favorite restaurant in Princeton.
4:35
Speaker 3: Yes, it's a Greek a laugh.
4:37
Speaker 1: Ah, nice, great, great choice.
4:40
Speaker 2: Yeah, I'm working in skillm in office most of the
4:43
Speaker 2: time some times in New York, and yeah, that's a
4:45
Speaker 2: great spot.
4:47
Speaker 3: It's great.
4:47
Speaker 4: And you know that entire place was new, it was
4:51
Speaker 4: like actually renovated and it was opened when I was
4:55
Speaker 4: when I was at school.
4:56
Speaker 1: Oh really, Yeah, have you ever been to.
4:59
Speaker 3: CONTI I haven't.
5:02
Speaker 4: No, that's one I'm going to have to add because
5:05
Speaker 4: I haven't even heard of.
5:06
Speaker 3: It is on the main strip.
5:09
Speaker 1: No, where is it? It's Witherspoon. No, oh, okay, might
5:15
Speaker 1: be on Witherspoon. Yeah.
5:18
Speaker 2: Kanti's Pizza is absolutely fantastic. It's kind of off, like
5:22
Speaker 2: out of the way, it's not I don't think it's
5:24
Speaker 2: that close to campus, but it's absolutely fantastic.
5:27
Speaker 1: I highly recommend it.
5:29
Speaker 3: I'll be there. Pizza is my favorite food.
5:31
Speaker 2: That was Yeah, that was one of port Noise. I
5:33
Speaker 2: think it's a top ten Dave Portnoy one slice rating,
5:40
Speaker 2: very high up there. Yeah, yeah, so definitely check it out.
5:42
Speaker 3: I love it.
5:43
Speaker 1: Next next may you got you got some homework to do?
5:47
Speaker 2: All right, let's let's start with a five thousand foot view.
5:51
Speaker 2: You know a lot of the economic indicators are weakening,
5:54
Speaker 2: but not the unemployment numbers.
5:57
Speaker 1: So how strong is the US job market right now?
6:01
Speaker 4: So it's kind of tricky, right because on the surface,
6:04
Speaker 4: it looks like unemployment is looking good, right, and unemployment
6:09
Speaker 4: one of the first indicators of economic health. But if
6:11
Speaker 4: you actually like double click into that unemployment number. Like,
6:17
Speaker 4: labor participation is high, it's about sixty two percent right now,
6:23
Speaker 4: but it's still lower than the pre pandemic levels. So
6:27
Speaker 4: labor participation has fallen. You know, it's not a ton,
6:31
Speaker 4: but it's fallen. And when you actually look at like
6:34
Speaker 4: the roles that people are taking on, a lot of
6:36
Speaker 4: them tend to be more like part time roles, so
6:39
Speaker 4: they're not necessarily these full time roles that would indicate
6:43
Speaker 4: like a more stable job. There are a lot of
6:45
Speaker 4: part time roles and the number of part time workers
6:48
Speaker 4: is increasing actually, so before like literally like you're on
6:53
Speaker 4: like now we're looking at like nearly four million workers
6:56
Speaker 4: are part time workers. So, you know, that's something to
7:00
Speaker 4: think about because in the restaurant industry, being a full
7:03
Speaker 4: time worker doesn't mean that you're working like nine to
7:06
Speaker 4: five forty hours a week. Being a full time worker
7:08
Speaker 4: means that you have some consistency of like thirty hours
7:12
Speaker 4: that you're getting scheduled in per week. Now, if you're
7:14
Speaker 4: below that, then that means that you probably have to
7:16
Speaker 4: have more than one job.
7:18
Speaker 2: Yeah, So yeah, and that's something I definitely wanted to ask.
7:22
Speaker 2: So let's ask it.
7:23
Speaker 1: Now, what percentage of the workforce are working multiple jobs.
7:27
Speaker 4: Well, so what we're seeing landed and we're you know,
7:31
Speaker 4: focused on this restaurant industry, the hospitality industry, our industry
7:34
Speaker 4: is seeing that each on average, an employee will hold
7:38
Speaker 4: two point one jobs simultaneously. So two point one jobs,
7:42
Speaker 4: I mean, so basically two, but actually in some cases
7:45
Speaker 4: like three. And that's because maybe you'll get ten hours
7:48
Speaker 4: over here, twenty hours over here, twenty hours over there,
7:51
Speaker 4: and that's what you need to support your livelihood. But
7:54
Speaker 4: it's interesting too though, because there are there's kind of
7:57
Speaker 4: this rise of and you know this for while, Mike,
8:01
Speaker 4: these like daytime cafes, like daytime cafes are doing super well.
8:06
Speaker 4: Coffee shops are doing you know, I think they're growing
8:08
Speaker 4: super fast. You have companies like seven Brew that are
8:12
Speaker 4: popping up and are going to sweep the nation. Yeah,
8:15
Speaker 4: and and so you have like all these like kind
8:17
Speaker 4: of jobs out there that are more like part time
8:20
Speaker 4: jobs where you can actually hold more than one job simultaneously.
8:23
Speaker 4: So I don't think that's necessarily a bad thing. Like
8:26
Speaker 4: having more than one job at the same time is
8:28
Speaker 4: not a bad thing as long as they're not in
8:31
Speaker 4: direct conflict with one another and they kind of help
8:34
Speaker 4: drive stability in like your livelihood.
8:38
Speaker 2: Yeah, so have you seen the actual number of full
8:40
Speaker 2: time job shrink?
8:43
Speaker 3: So there are a ton of open jobs. It's the problem.
8:47
Speaker 3: You know, there are a ton of open jobs. And so.
8:51
Speaker 4: Like the number of full time jobs, like it's kind
8:55
Speaker 4: of stable, maybe a little bit up, but there's so
8:57
Speaker 4: many open jobs, Like it's it's kind of crazy. And
9:02
Speaker 4: and you actually also see like gig economy. I brought
9:04
Speaker 4: up the gig economy that's like grown a lot, and
9:09
Speaker 4: that's kind of cannibalizing some of like the full time
9:12
Speaker 4: job openings. Like I know that we are going to
9:16
Speaker 4: talk about this, and like it's it's kind of crazy.
9:18
Speaker 4: But like literally a gig economy is of eighty percent
9:22
Speaker 4: since which rate since January twenty twenty, Like eighty percent
9:27
Speaker 4: growth and just a short timeframe. And that's like, you know,
9:32
Speaker 4: that's a contributing factor to keeping low unemployment levels. But
9:35
Speaker 4: that's not like that's not like a sustainable like full
9:39
Speaker 4: time job.
9:40
Speaker 2: Yeah, so is this mainly younger workers that are are
9:43
Speaker 2: you know involved in these gig jobs?
9:46
Speaker 4: Not necessarily, so there are a lot of workers kind
9:50
Speaker 4: of like you know, there are the younger workers, of course,
9:52
Speaker 4: but a lot of the workers actually, like they are
9:56
Speaker 4: ages like twenty five to forty, and you know, there's
10:00
Speaker 4: a big population of them that are the immigrant like workers, right,
10:03
Speaker 4: the immigrant workers are coming up, but of course they're
10:05
Speaker 4: you know, they can work in the US, go through
10:07
Speaker 4: the background tracks, they do all that stuff, but they're
10:10
Speaker 4: trying to like get their footing here still.
10:13
Speaker 3: So it's an easy way to get footing.
10:16
Speaker 4: But really, like there's a they can get jobs that
10:21
Speaker 4: are not like the gig economy jobs, just it's just
10:24
Speaker 4: that they have to like really get their bearings once
10:26
Speaker 4: they've like moved over.
10:28
Speaker 2: Okay, Yeah, I find that interesting because I'd assume it
10:30
Speaker 2: would be the younger cohorts people that aren't ye in
10:34
Speaker 2: a hurry to get health insurance and stuff like that, right.
10:37
Speaker 4: Yeah, And I mean so there aren't like a lot
10:38
Speaker 4: of these companies that have popped up to support gig workers,
10:42
Speaker 4: like everything like help you get loans to get a car,
10:45
Speaker 4: help you get loans to get it like you know,
10:47
Speaker 4: mopad helps you actually get the health insurance and things
10:53
Speaker 4: like that. But it's tough because it's like it's expensive
10:58
Speaker 4: and you see states like California, you know, always the
11:03
Speaker 4: first ones to do it, and then you have like
11:04
Speaker 4: New York City and you know, they just passed like
11:07
Speaker 4: the twenty dollars minimum wage, and that's going to change
11:12
Speaker 4: things because full time employees are are entitled to certain benefits,
11:18
Speaker 4: but part time employees and mental states are not. So like,
11:21
Speaker 4: how will that change how restaurants think about their labor
11:25
Speaker 4: mix is going to be it's gonna We're going to
11:28
Speaker 4: see a lot of changes because California is just one state.
11:33
Speaker 4: But if you're going to change it for all California,
11:36
Speaker 4: basically the rest of the country is going to follow.
11:39
Speaker 4: And the company has to like think about things from
11:41
Speaker 4: that perspective and they're not going to just isolate it
11:44
Speaker 4: to California. It really is like challenging companies to think
11:47
Speaker 4: through everything.
11:49
Speaker 2: Yeah, we wrote that when we wrote our note about
11:52
Speaker 2: the about the passage of that bill, and it's you know, Oregon, Washington,
11:56
Speaker 2: New York, Illinois. Those states are pretty fast fallows when
12:00
Speaker 2: it comes to some of the workers legislation that comes
12:04
Speaker 2: through California.
12:06
Speaker 1: So you mentioned the gig economy has been around for.
12:09
Speaker 2: A little while. How how has it evolved over the
12:11
Speaker 2: years and what industries hasn't impacted.
12:13
Speaker 3: The most absolutely, so the gig economy.
12:17
Speaker 4: You know, when it first started, like all these companies
12:20
Speaker 4: that were even before like door Dash and Uber and Lyft,
12:24
Speaker 4: there was like there were a bunch of other companies
12:27
Speaker 4: that you know, ultimately didn't make it, and these were
12:29
Speaker 4: the ones that succeeded. But what they really did was
12:33
Speaker 4: they like it was a labor arbitrage opportunity. You could
12:36
Speaker 4: take somebody from one place and bring them to another
12:39
Speaker 4: place where it might be a little bit more affluent,
12:42
Speaker 4: and people are willing to pay for the service of comedians.
12:45
Speaker 4: And so this is interesting too because like at the
12:49
Speaker 4: same time as gig economy has been rising in the
12:52
Speaker 4: past like about like almost a decade, you also have
12:57
Speaker 4: the gen z and the millennial like generations that have
13:00
Speaker 4: grown up on the internet with instant gratification. So as
13:05
Speaker 4: like the services have evolved, it's kind of like chicken
13:08
Speaker 4: and egg because like the consumer now frankly demands this
13:13
Speaker 4: type of instant gratification. So how the gig ecomny has
13:16
Speaker 4: evolved is okay, great. It like started out with just cars,
13:19
Speaker 4: all right, we need to get around in cities. But
13:21
Speaker 4: then now it's and then you have like door dash
13:24
Speaker 4: and grub hub, and now everybody needs their food like
13:27
Speaker 4: at their doorstep in like thirty minutes.
13:30
Speaker 3: Like I know, if if I.
13:32
Speaker 4: See a restaurant takes more than thirty minutes to deliver something,
13:35
Speaker 4: I'm probably not going.
13:36
Speaker 3: To order from it because everybody is so impatient.
13:39
Speaker 4: Nowadays, and so like the consumer now frankly demands it.
13:44
Speaker 4: And this has really like expanded outside of just you know, transportation,
13:48
Speaker 4: It's expanded outside of restaurants and hospitality where I mean
13:52
Speaker 4: most QSR is, like you know, fifty to seventy percent
13:55
Speaker 4: of their orders are like supported by the gig economy
13:58
Speaker 4: their delivery type orders. So that's there. But then also
14:03
Speaker 4: like we got to think about like warehousing and logistics.
14:06
Speaker 4: I mean, I think all of us knew about like
14:08
Speaker 4: the crazy supply chain crises that were happening in the
14:11
Speaker 4: past couple of years.
14:13
Speaker 3: And why is that.
14:15
Speaker 4: Well, like, actually warehousing and storage and couriers and messengers,
14:19
Speaker 4: air transportation, all these industries are also not as high,
14:24
Speaker 4: not as up as like gig economy, which is eighty percent.
14:26
Speaker 4: But since February twenty twenty, they've been up like nearly
14:29
Speaker 4: thirty to forty percent each of these categories. So what
14:34
Speaker 4: that means is like, now anything that we want to
14:36
Speaker 4: order like we need like this type of like instant speed.
14:39
Speaker 3: There are companies like Gettier here in New York, Fridge
14:42
Speaker 3: no More that you.
14:43
Speaker 4: Know, unfortunately, like you know, went out of business or
14:46
Speaker 4: got acquired Gorillaz, and they were promising ten minute fifteen
14:51
Speaker 4: minute delivery times.
14:52
Speaker 3: I mean it's insane.
14:53
Speaker 4: And then now you got to also look at other countries,
14:56
Speaker 4: like places like China, fifteen minute delivery times have been
15:00
Speaker 4: has been a norm in the major metropolitans for the
15:02
Speaker 4: past few years. Actually, So it's just we're going to
15:08
Speaker 4: be moving in this type of direction where it's like
15:09
Speaker 4: instant gratification is super important. Digital data is super important
15:15
Speaker 4: because now we're kind of living in this like omni
15:18
Speaker 4: channel world where everything is omni channel now, so data
15:23
Speaker 4: has to be omni channel two and every industry is
15:28
Speaker 4: going to be impacted by it. But we're seeing huge
15:31
Speaker 4: impacts on hospitality, on transportation, on like home goods, retail, warehousing,
15:39
Speaker 4: these industries, and these are also the industries that like
15:42
Speaker 4: you know, land it focuses on because we think about
15:44
Speaker 4: high volume hiring as of really are sweet spot and
15:47
Speaker 4: high volume hiring is our sweet spot because they're high turnover.
15:52
Speaker 3: It's high activity industries.
15:55
Speaker 2: Yeah, yep, as we know, our restaurant industry is a
15:59
Speaker 2: very high turn over our restaurants back to pre pandemic
16:03
Speaker 2: staffing levels right now.
16:05
Speaker 4: Well, so it's so like where restaurants have experienced basically
16:11
Speaker 4: like a year and a half of consecutive employment growth.
16:15
Speaker 3: So actually, like we do have the.
16:17
Speaker 4: Same number of restaurant employees about twelve point four million
16:21
Speaker 4: today as we did in early twenty twenty.
16:24
Speaker 3: Okay, so that's good.
16:26
Speaker 4: But the problem is that like a lot of like
16:29
Speaker 4: the restaurant jobs have become complex and they're just more
16:33
Speaker 4: of them, Like there are a lot of open jobs.
16:36
Speaker 4: And it's because if we look at like the restaurant
16:39
Speaker 4: and how it's evolved in the past couple of years,
16:41
Speaker 4: like we basically turbo charged and industry by like a
16:44
Speaker 4: decade in the span of like a year, which is crazy.
16:47
Speaker 4: And so like we have the introduction of like everybody
16:52
Speaker 4: has to be on third party delivery now you just
16:54
Speaker 4: have to. Everybody has a loyalty program. Everybody has some
16:59
Speaker 4: not everybody, but most have some type of like cloud
17:03
Speaker 4: concept or ghost kitchen concept. Everybody has new hygiene practices
17:09
Speaker 4: and the good the restaurants that have been doing well
17:11
Speaker 4: are growing really fast because you know, there's a lot
17:15
Speaker 4: of cheap commercial real estate that they were able to
17:18
Speaker 4: kind of snap up in the pits of the pandemic.
17:21
Speaker 4: So now you know you have this employment growth, but
17:26
Speaker 4: you have so many new openings. I mean, I think
17:29
Speaker 4: that probably like a third of all the locations that
17:32
Speaker 4: we're working on at any given point, Okay, maybe a
17:35
Speaker 4: third is a lot, but like twenty five percent there
17:37
Speaker 4: are new openings. Twenty five percent of our clients. The
17:39
Speaker 4: third of our clients have new openings like literally every month,
17:43
Speaker 4: and these are multiple, and so I think that like
17:47
Speaker 4: we can't really compare apples to apples, Like where we
17:49
Speaker 4: were in February twenty twenty is very different than where
17:51
Speaker 4: we are now. The jobs are a lot more complex
17:54
Speaker 4: and there are more jobs, which is why you have
17:56
Speaker 4: to introduce technology. Because restaurants can't continue to higher headcount
18:01
Speaker 4: to support like their their increasingly complex businesses. They have
18:04
Speaker 4: to introduce technology in order.
18:06
Speaker 3: To keep up.
18:08
Speaker 2: Okay, how's application volume versus say last year? And then
18:13
Speaker 2: against pre pandemic levels.
18:15
Speaker 4: Yeah, so application volume is like looking up like literally
18:20
Speaker 4: in the past like six months, I would say, like
18:24
Speaker 4: last last year, it was really challenging because there were,
18:30
Speaker 4: you know, applications were kind of these like passive ghost
18:33
Speaker 4: applications where you know, due to how like certain states
18:37
Speaker 4: had their unemployment benefits set up, like there's a lot
18:39
Speaker 4: of just like you know, people applying and not necessarily
18:43
Speaker 4: looking for jobs, and so that that made it very
18:46
Speaker 4: challenging for the industry. So now we are finding that actually,
18:51
Speaker 4: like what the metric that we look at is actually
18:54
Speaker 4: like a cost per application. So rather than the volume
18:56
Speaker 4: of applications, like what we really monitor heavily in each
18:59
Speaker 4: of the differences codes across all fifty states which we're
19:03
Speaker 4: in all fifty states, is the cost application. This is
19:07
Speaker 4: a good metric because cost application tells you like how
19:11
Speaker 4: much traffic there is and how expensive that traffic is
19:15
Speaker 4: in applying for a job. So we actually found that,
19:19
Speaker 4: you know, because we're good at what we do at LANDED,
19:21
Speaker 4: you know, we're able to come in at usually like
19:23
Speaker 4: thirty to forty percent below like benchmark cost p applications.
19:27
Speaker 4: But even with even among like Landed clients. We're finding that,
19:32
Speaker 4: like cost applications in the past two quarters have like
19:34
Speaker 4: dropped around like fifteen to twenty percent drop. Now we're
19:39
Speaker 4: going to be expecting seasonality. We're going into the holiday season,
19:42
Speaker 4: and holiday season is always very very competitive, so we
19:46
Speaker 4: do expect, like you know that to kind of increase
19:49
Speaker 4: a little bit for the next few months at least,
19:51
Speaker 4: but then it's going to go back.
19:53
Speaker 3: So cost application is good.
19:55
Speaker 4: I mean, you know, paying to get candidates is not
19:59
Speaker 4: something that every single brand has to do, but every
20:02
Speaker 4: single brand has to do at some point, like usually
20:04
Speaker 4: around a new opening, usually around you know, specific like
20:09
Speaker 4: we call them like nine to one one red locations
20:11
Speaker 4: that have challenges, maybe a place where you know, manager
20:15
Speaker 4: turnover is high. It's like nearly seventy percent at QSRs,
20:18
Speaker 4: which is crazy, Like you know, they're like the lifeblood
20:22
Speaker 4: of a business. But when you have manager turnover, you
20:24
Speaker 4: would expect more turnover in the hourlies as well. So
20:28
Speaker 4: it's kind of like something that we have in our
20:31
Speaker 4: arsenal to help. But something that we are talking very
20:36
Speaker 4: closely is that cost for application metric.
20:39
Speaker 2: Interesting, many workers didn't want to go back to the
20:43
Speaker 2: restaurant industry post pandemic. Is that still the case there
20:47
Speaker 2: or are some some previous restaurant employees return into the business.
20:52
Speaker 4: We do see not necessarily it's like previous restaurant employees,
20:57
Speaker 4: so you know, now they have like a lot these
21:00
Speaker 4: different options. But we do see like a new crop
21:02
Speaker 4: of restaurant employees. So before in twenty twenty, we had
21:09
Speaker 4: about like seven about seven percent of the employees were
21:13
Speaker 4: just for restaurants of the employees, and when we look
21:18
Speaker 4: at it now, it's actually a little bit higher. It's
21:21
Speaker 4: like around like eight percent of all employees are like
21:25
Speaker 4: you know, in the restaurant industry. So as a whole,
21:29
Speaker 4: if you look at it, it looks like there are
21:31
Speaker 4: more people turning to that. But I think a lot
21:33
Speaker 4: of that's coming from like the new the new crop
21:36
Speaker 4: of gen Z employees, you know, seventy percent of hourly
21:39
Speaker 4: workers nowadays or gen Z.
21:41
Speaker 3: It makes sense. But because everyone.
21:44
Speaker 4: Is you know, a lot of your workers are gen Z,
21:47
Speaker 4: you're going to have to rethink, like how to retain
21:50
Speaker 4: gen Z employees is different?
21:52
Speaker 1: Yeah, how is it different?
21:54
Speaker 4: I mean I think that there are a lot of
21:57
Speaker 4: stereotypes out there, Okay, but there are like things that
22:01
Speaker 4: really like come down to, like you know, we run
22:03
Speaker 4: we've run surveys and we like we have over a
22:05
Speaker 4: million candidates that you know, we've engaged at any given point
22:08
Speaker 4: in time. We have like you know, millions of like
22:11
Speaker 4: job applications that we've engaged with, and we're finding that
22:15
Speaker 4: the most actually like it's this is kind of crazy,
22:19
Speaker 4: but like a third of gens employees actually care more
22:22
Speaker 4: about career growth than the pay necessarily. So that's interesting
22:27
Speaker 4: because that means that you know, they're thinking about, like, Okay,
22:31
Speaker 4: what do I get in the long term Here this
22:33
Speaker 4: kind of goes back to what I was talking about
22:34
Speaker 4: with like gig workers, like what do you get in
22:36
Speaker 4: the long term, like working a gig job? Like you
22:39
Speaker 4: don't want to necessarily be doing that the rest of
22:41
Speaker 4: your life.
22:41
Speaker 3: And so.
22:43
Speaker 4: That landed what we think a lot about is more like, Okay,
22:45
Speaker 4: how do we help someone build their career in the
22:48
Speaker 4: industries that we serve. The other thing that we're that
22:53
Speaker 4: brands that are preferred employers think about is like really
22:56
Speaker 4: playing up like that social awareness and responsibility that they
23:00
Speaker 4: are that they are bringing to the community. So this
23:05
Speaker 4: is actually crazy number if from our surveying is that
23:08
Speaker 4: fifty one percent of gen Z employees will actually take
23:11
Speaker 4: a lower salary if their employer was environmentally responsible. So
23:16
Speaker 4: that's kind of interesting because like, you know, sometimes you
23:18
Speaker 4: hear out there like oh, my workers like move down
23:21
Speaker 4: the street for ten cents pay up or like career
23:25
Speaker 4: for twenty cent pay up, and that is you know,
23:26
Speaker 4: that is still definitely the case. But like these new
23:29
Speaker 4: like entry level team member employees, like you know, think
23:32
Speaker 4: about things a little bit differently, you know, they were
23:34
Speaker 4: they've kind of.
23:35
Speaker 3: Grown up in like this new era.
23:38
Speaker 4: And then the other thing that's going to be really
23:40
Speaker 4: important this is going to be I will predict now
23:43
Speaker 4: calling it right here on chopping it up with Mike
23:46
Speaker 4: and Vibian that in ten in the next like ten years,
23:51
Speaker 4: daily pay or even streaming pay like by the hour,
23:55
Speaker 4: by the minute, by the second, which is what you
23:58
Speaker 4: know basically gig economy already brings to the table, is
24:01
Speaker 4: going to be a necessary part of the job because
24:05
Speaker 4: you know, eighty one percent of hourly workers are worried
24:08
Speaker 4: about paying their bills. They're living paycheck to paycheck, and
24:12
Speaker 4: having a two week or even weekly like pay cycle
24:16
Speaker 4: for them is just it's like it's actually quite archaic,
24:19
Speaker 4: like it doesn't actually match up to like the speed
24:23
Speaker 4: and the instant gratification that we know are themes.
24:26
Speaker 1: Yeah, that's that's cool, very cool.
24:28
Speaker 2: So which restaurant chains are doing a good job of
24:30
Speaker 2: attracting GM talent hourly talent and how are they doing it?
24:35
Speaker 3: Sure?
24:36
Speaker 4: So you know, we we work with a bunch of
24:39
Speaker 4: different companies like that, like that really range and like,
24:45
Speaker 4: of course I have like a little I have soft
24:47
Speaker 4: spot for our clients, but like, you know, we see
24:49
Speaker 4: companies that are doing some pretty cool stuff. So like
24:53
Speaker 4: Kava for example, Like they are very focused on you know,
24:58
Speaker 4: they've super well and they're very like technology focused. They
25:03
Speaker 4: really understand that the general manager is really the life
25:06
Speaker 4: blood of their business. And they have gardens, you know,
25:09
Speaker 4: they have these gardens of managers and gardens of restaurants
25:15
Speaker 4: and they are all about just like actually the support center,
25:19
Speaker 4: like the HQ supporting their managers. Like their managers are
25:23
Speaker 4: really like the ones running the show, and they make
25:26
Speaker 4: sure that you know anything that what the manager needs
25:29
Speaker 4: to focus on day to day is guest experience and
25:31
Speaker 4: like the quality of their product, so the food, the beverages.
25:35
Speaker 3: And everything else.
25:36
Speaker 4: They're thinking about technology and bringing technology in and AI.
25:43
Speaker 4: Generative AI is a hot topic in this area because
25:46
Speaker 4: and like, you know, what we're able to bring the
25:48
Speaker 4: table is, hey, all that manual stuff that their managers
25:51
Speaker 4: are doing, they don't need to do anymore, like Landed
25:55
Speaker 4: can help take care of it. But then also like
25:58
Speaker 4: personalization is the other piece. So one of our clients is.
26:02
Speaker 3: Uh, you know, lou Mal Natties.
26:03
Speaker 4: Lu Mal Naughties has been known in the Chicago, you know,
26:07
Speaker 4: into Chicago world forever and they are expanding rapidly across
26:12
Speaker 4: the US because they've done super well. And one of
26:15
Speaker 4: the things that like, you know, they care a lot
26:18
Speaker 4: about is like bringing that family, like you know, old
26:21
Speaker 4: school Chicago deep dish, like across across the US to
26:24
Speaker 4: Wisconsin to Arizona. And so personalization of your interactions with
26:30
Speaker 4: people are super important. That's another thing that gen z
26:32
Speaker 4: and millennials care about. They don't want to talk to
26:34
Speaker 4: a chatbot, Like how many times have you called and
26:37
Speaker 4: you're talking to a chat bot and you just repeatedly
26:39
Speaker 4: hit zero zero.
26:40
Speaker 3: I want to talk to human being.
26:44
Speaker 4: Yeah, And you know the worst is when they respond
26:46
Speaker 4: and they're.
26:47
Speaker 3: Like, no, sorry, we don't recognize the zero. And I'm like, what,
26:50
Speaker 3: like I'm never going to talk to a human beings?
26:54
Speaker 4: Yeah, yes, And so like you know, we're in the
26:59
Speaker 4: hospitality into street. We're in the hospitality business is fundamentally
27:02
Speaker 4: human business. And yet we think about like our employees
27:06
Speaker 4: and the employee retention, and we're like, you know, once
27:08
Speaker 4: they started at the job, we need to make sure
27:10
Speaker 4: they have a great experience. Well what about before they
27:12
Speaker 4: start at the job, because your first impression with the
27:14
Speaker 4: employee is like how you show up to the employee
27:17
Speaker 4: and the application process, so personalizing the outreach, making sure
27:21
Speaker 4: that you're really fast, making sure that you are like
27:24
Speaker 4: on top of it. Everybody likes to talk to somebody
27:26
Speaker 4: who is communicative, personalized, fasten the response, and thorough and
27:31
Speaker 4: frankly like managers if they're doing that like themselves on
27:34
Speaker 4: top of all the other things that we just described,
27:37
Speaker 4: that's part of a manager's job, like does not have
27:39
Speaker 4: time for that, otherwise they'd be a full time recruiter.
27:42
Speaker 3: Like that's why the recruiter job like exists.
27:45
Speaker 4: So that's something that we're able to help with, is
27:47
Speaker 4: like that personalization and like leveraging AI and technology to
27:50
Speaker 4: do so rather than necessarily having to hire, not even hire,
27:55
Speaker 4: but just like you know, put more stuff on your
27:57
Speaker 4: GM's shoulders and on their plate.
28:00
Speaker 2: Yeah, so you mentioned that Kava has very strong communications
28:06
Speaker 2: between their gms and their support center. What are the
28:10
Speaker 2: implications for chains that don't do this well and how
28:13
Speaker 2: can land and help solve that issue?
28:16
Speaker 3: Sure?
28:16
Speaker 4: So, I mean the big implication of it is that
28:19
Speaker 4: we're in a competitive world.
28:20
Speaker 1: Right.
28:21
Speaker 4: If you have a finite labor pool, and that labor
28:26
Speaker 4: pool has a lot of options, not just even in
28:29
Speaker 4: the restaurant industry, but in other industries, you know, because
28:32
Speaker 4: there's also the rise of remote work too, then you're
28:36
Speaker 4: going to just stay perpetually understaffed, and there's just like
28:40
Speaker 4: negative cycle, right, because you've got to when you're understaffed,
28:45
Speaker 4: what are you doing. You're probably paying over time, you
28:48
Speaker 4: might be paying for temp, You're probably cutting hours and
28:50
Speaker 4: like the most important time of the day for example,
28:54
Speaker 4: like late night labor. Late night labor is a nightmare
28:58
Speaker 4: like for most companies, but that is a big opportunity
29:01
Speaker 4: because late night tends to have larger basket values compared
29:06
Speaker 4: to their daytime counterparts. They frequently require delivery services, so
29:10
Speaker 4: that's something that you have to have set up. And
29:13
Speaker 4: if you're not mastering late night or you're not becoming
29:15
Speaker 4: a top player in late night, you are going to
29:18
Speaker 4: be missing out on a huge revenue opportunity. Okay, but
29:21
Speaker 4: you can't open late night when you're understaffed, right, and
29:24
Speaker 4: if no one wants to come work from you know,
29:27
Speaker 4: eleven pm to four am for you or on the
29:30
Speaker 4: flip side, you know, we work with Tim Horton's duncan
29:33
Speaker 4: want to come in at four am to bake your donuts,
29:36
Speaker 4: you know, then you're kind of out of luck.
29:38
Speaker 3: So either you.
29:42
Speaker 4: It's kind of like a twofold right, So there's so
29:44
Speaker 4: manytinential stuff that we can do. That's like in the
29:46
Speaker 4: short term, you can introduce like more competitive pay. Okay, great,
29:50
Speaker 4: you can, but without like the money piece, Like one
29:54
Speaker 4: in every three candidates hourly candidates will just take the
29:57
Speaker 4: first job they're offered actually because you know, they're wanting
30:01
Speaker 4: to move fast. So even if you pay the exact
30:04
Speaker 4: same amount as the person next door, if you're just
30:06
Speaker 4: faster at getting to them and you know landed. Of course,
30:09
Speaker 4: we make everything very immediate. We're twenty four hours a day,
30:12
Speaker 4: seven days a week, constantly communicating with candidates, delivering personalized
30:17
Speaker 4: responses using our generative AI plus our human recruitment specialist team.
30:22
Speaker 4: Then you're going to be able to like with that,
30:25
Speaker 4: you're going to be able to stay competitive even without
30:27
Speaker 4: hitting necessarily or bottom line, you just have to be
30:30
Speaker 4: faster and better at running operations. And you know, the
30:33
Speaker 4: long term thing there is like, also, how do you
30:38
Speaker 4: make sure that you're actually betting for quality candidates? Quality
30:41
Speaker 4: candidates are something that everybody wants. Like nobody ever says
30:45
Speaker 4: they don't want a quality candidate, but everybody does desperation
30:47
Speaker 4: hiring like everybody. And so when you're down a couple
30:52
Speaker 4: people and you have your general manager who's way overpaid
30:54
Speaker 4: to be flipping burgers flipping burgers, then you know you're
30:58
Speaker 4: not necessarily like running an efficient operation, but you have
31:01
Speaker 4: to do that to kind of limp on. So what
31:04
Speaker 4: we do is we kind of sit down and understand, Okay,
31:06
Speaker 4: what does a quality candidate look like for every single
31:10
Speaker 4: you know, brand and for every role because it varies,
31:13
Speaker 4: and so once we understand what that is, then we
31:16
Speaker 4: go and then we actually develop like you know, hiring plan,
31:18
Speaker 4: we go and find those quality candidates so that really
31:21
Speaker 4: your managers are only spending time with quality people who
31:23
Speaker 4: can be on their team soon, so they're.
31:26
Speaker 3: Not wasting time with people who are not going to
31:28
Speaker 3: be good fits. Instead, they're spending more time.
31:30
Speaker 4: They have more time to spend them with their existing
31:32
Speaker 4: team to know how the existing team is doing. And
31:36
Speaker 4: so it sounds like you know, wave a magic wand
31:40
Speaker 4: and Landed can do all these things. But of course
31:41
Speaker 4: it's like a two way street. We got to sit
31:43
Speaker 4: down and understand like that holistic strategy and then we
31:47
Speaker 4: will we will implement that for you and then just
31:52
Speaker 4: have your managers make that ultimate hiring decision because we
31:54
Speaker 4: of course would never take that away from them.
31:57
Speaker 2: Yeah, that's been a huge theme with our companies, the
31:59
Speaker 2: companies that we cover, or is you know, freeing up
32:01
Speaker 2: time for the gms, freeing up time for them to
32:03
Speaker 2: touch the tables and coach the team and.
32:07
Speaker 1: And not have to get into that daily grind. You know.
32:11
Speaker 2: I think I think everybody's pretty much woken up to
32:13
Speaker 2: the fact that you know, you need good, good, strong
32:17
Speaker 2: gms run in your restaurants to be successful. You know,
32:22
Speaker 2: Another one of the themes that we've written about this
32:24
Speaker 2: year was late night and how some of the chains
32:29
Speaker 2: that do a really strong business at late night. Jack
32:31
Speaker 2: in the Box leads the pack, but you know, Wendy's
32:34
Speaker 2: McDonald's has some twenty four hour stores that they had
32:38
Speaker 2: kind of the sales tail wind because late night would
32:41
Speaker 2: get better. And you kind of touched on it a
32:44
Speaker 2: little bit in your previous answer, So, so what is
32:46
Speaker 2: going on? Why is late night labor improving? Is it
32:50
Speaker 2: just them offering more pay or is there something else
32:54
Speaker 2: in there?
32:55
Speaker 4: Yeah, so lately labor is improving. We do see Actually
32:59
Speaker 4: this like introtion of like tiered pay rates. So tiered
33:04
Speaker 4: pay rates is like something that like was previously mostly
33:08
Speaker 4: happening around like seasonal like around like holiday basically. But
33:12
Speaker 4: now I think that, uh that restaurants are getting smarter
33:17
Speaker 4: about this, where they're like, okay, like this is a
33:19
Speaker 4: supply and demand problem, right, so if I increase like
33:23
Speaker 4: the price of the of the demand, then the supply
33:28
Speaker 4: will the you know, the supply will come, and so
33:31
Speaker 4: uh that this is something that like I think this
33:34
Speaker 4: is a norm that had to be introduced like during
33:37
Speaker 4: like the COVID timeframe where it was just like.
33:40
Speaker 3: A mess, and so now I actually.
33:44
Speaker 4: Very frequently see like you know, actually twenty percent pay
33:47
Speaker 4: rate increases for like certain for certain shifts, and so
33:53
Speaker 4: late like late night labor is improving because they have
33:57
Speaker 4: these like you know, they have that increased pay you
34:01
Speaker 4: know capacity. But then also back to like what I
34:04
Speaker 4: was talking about with like the like having each person
34:07
Speaker 4: have two to three jobs simultaneously. If you have a
34:10
Speaker 4: day job or like a day part job, then you
34:13
Speaker 4: can also work some late night as well. And so
34:16
Speaker 4: that's that's something that is really interesting and ultimately, like
34:23
Speaker 4: the other thing about late night is that late night
34:25
Speaker 4: you it's a lot more about delivery and like digital ordering.
34:28
Speaker 3: So like, you know, one of the.
34:30
Speaker 4: Things that we see is a lot of folks in
34:35
Speaker 4: the restaurant industry have faced you know, sixty two percent
34:39
Speaker 4: of workers have felt like they've been mistreated by customers.
34:42
Speaker 4: I guess, so you know, at some point in time, right,
34:46
Speaker 4: like somebody else is having a bad day, they take
34:48
Speaker 4: it out on you.
34:49
Speaker 3: When it's late night. It's a lot more about like
34:51
Speaker 3: interfacing with a computer.
34:53
Speaker 4: You know, you're interfacing with like these third party apps
34:56
Speaker 4: that are coming in you just have to do your job. Well,
34:58
Speaker 4: it's you know, the back of house, and then you
35:01
Speaker 4: and then you're able to kind of like push that forward.
35:04
Speaker 4: One of the things that at Landed we do is
35:07
Speaker 4: we also support multi lingual like hiring, so we're able
35:12
Speaker 4: to have like do hiring in like many different languages.
35:15
Speaker 4: And there has been like a surge in like non
35:17
Speaker 4: English speakers like entering the restaurant industry in the past
35:20
Speaker 4: few years. And but it's really important. I see actually
35:23
Speaker 4: certain restaurants like running their entire back of house in
35:26
Speaker 4: Spanish actually, and all the instructions are written in Spanish.
35:30
Speaker 4: And these are like large chains like these are they're
35:33
Speaker 4: quite large. And so that's interesting, right, because we have
35:37
Speaker 4: to be a lot more accommodating of the diverse, like
35:40
Speaker 4: of the diverse labor population and make sure that you
35:44
Speaker 4: can be the employer of choice, not just to English speakers,
35:46
Speaker 4: but to everybody who might be working in the industry.
35:49
Speaker 4: And when you have like a certain day part in
35:53
Speaker 4: your shift that allows for you know, anybody to come
35:57
Speaker 4: in even if maybe they don't have the front of
35:59
Speaker 4: house experience, maybe if they are like native speakers of
36:02
Speaker 4: another language, it expands your pool. But you can also
36:05
Speaker 4: expand your pool if you just make your entire hiring
36:08
Speaker 4: process more accommodating of different languages.
36:10
Speaker 2: Yeah, and just removing stress from the employees that you
36:13
Speaker 2: do have that maybe you know, English is a second
36:16
Speaker 2: language for it, right.
36:18
Speaker 1: Exactly, shakesheck is tried a four day work week? Does
36:22
Speaker 1: it work?
36:24
Speaker 3: So?
36:24
Speaker 4: Four day work week is a tricky one. I think,
36:28
Speaker 4: like what we've actually seen work really well because like
36:32
Speaker 4: for hourly workers, like the four day work week is
36:34
Speaker 4: kind of like it happens to some of them anyway.
36:38
Speaker 3: But really like where it comes down to is like
36:39
Speaker 3: the general manager.
36:40
Speaker 4: When I talk about the four day work week, when
36:42
Speaker 4: when I hear about like, you know, days off, I
36:45
Speaker 4: hear about it primarily around like that manager role, because
36:48
Speaker 4: the manager is, like, you know, it's a stressful job.
36:51
Speaker 4: I actually hear some companies that have like two managers
36:54
Speaker 4: per restaurant so that there can be like a little
36:57
Speaker 4: bit more coverage, and they actually found that that's cost
37:00
Speaker 4: effective because manager turnover is so expensive. So what I'm
37:05
Speaker 4: actually seeing work really well is having two consecutive days
37:10
Speaker 4: for managers to take time off so it doesn't have
37:13
Speaker 4: to be Saturday, Sunday, but it could be Monday Tuesday.
37:15
Speaker 4: But as long as they have those two consecutive days
37:18
Speaker 4: and then maybe during those days you have the AGM
37:20
Speaker 4: or maybe you have like that kind of the other GM,
37:22
Speaker 4: or maybe you have the district manager kind of just
37:25
Speaker 4: be a be like more hands.
37:28
Speaker 3: On during those two days.
37:29
Speaker 4: That's really the thing that is like making managers a
37:32
Speaker 4: lot happier and helping them like stay. So that's like
37:35
Speaker 4: something a way to come back. That's sixty eight seventy
37:38
Speaker 4: percent manager turnover, and so I would really encourage folks
37:43
Speaker 4: to like think about it more so from the perspective
37:45
Speaker 4: of the manager.
37:46
Speaker 3: Like four day work week.
37:49
Speaker 4: Good, but really like two consecutive days off is like
37:51
Speaker 4: really what I'm seeing like works.
37:53
Speaker 1: Well, yeah, it makes sense to me.
37:55
Speaker 2: You need it's a tough job, so you need those
37:57
Speaker 2: two days to kind of decompress.
38:00
Speaker 3: Yes, exactly exactly instead.
38:03
Speaker 1: Of Sunday scaries.
38:04
Speaker 2: It might be the Tuesday scaries or something, but exactly yes.
38:08
Speaker 4: And I mean also like that's a lot of you know,
38:11
Speaker 4: Chick fil A has Sunday's closed like every every week, right, and.
38:15
Speaker 3: You know there are other businesses that do that. You know,
38:18
Speaker 3: that's like, I don't.
38:19
Speaker 4: I think a lot of businesses are the can't like
38:21
Speaker 4: necessarily do that, But I mean there are many companies
38:24
Speaker 4: that do.
38:25
Speaker 1: Quite well that make it work for sure. All right,
38:29
Speaker 1: good stuff. Listen, next time you're in Princeton. Let me know.
38:33
Speaker 1: Maybe we'll do conties together.
38:35
Speaker 3: All right, that's the plan.
38:37
Speaker 1: Awesome, I'll hold you to it. Yeah, for sure.
38:39
Speaker 2: Thanks for doing this. Where can the audience go to
38:42
Speaker 2: find more about Landed?
38:44
Speaker 4: You can hit me up at vivianatgotlanded dot com. I
38:48
Speaker 4: am all at ears and you can also go to
38:51
Speaker 4: our website at gotlanded dot com.
38:53
Speaker 3: G O T L A n d ed dot com.
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Speaker 3: You can also find me on Twitter and LinkedIn.
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Speaker 2: All right, stup y'all restaurant tours that I know have
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Speaker 2: have great things to say about you and the business.
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Speaker 1: So I also want to thank the audience for tuning in.
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Speaker 2: If you liked the episode, please share it with your
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Speaker 2: friends and colleagues. Check back in a couple of weeks.
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Speaker 2: I'll be interviewing Bloomberg's US restaurants reporter daniellis Er Tory
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Speaker 2: Cortina