A WY 0? PERSONNEL mmm AND TRENDS
{N LABOR €033 AMGNG SUCCESSFUL
RESTAURANTS

Thesis f0: flu W of M. A.
MICHlGAN 37A“ UMW
George D. Bad-ail
.1963

oIIOONOQ..“oM'O' ”909-0.

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THES‘S

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9 0185 .

LiBHARY

Michigan State

University

 

 

PLACE Iii RETURN BOX to removothb Choekoutfmm your record.
To AVOID FINES rotum on or baton data duo.

DATE DUE DATE DUE DATE DUE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ABSTRACT

A STUDY OF THE FIRSOEHfiL PRACTICES
AND TREEDS IN LARGE COST
AHQEG SUCCBSiFUL RfiflfaJRAETS

by George D. Bedell

Body orvaetraot

The study covere the experience of 427 restaurants with
a total seating capaoity of over 85,000 eeate, employing more
than 24,000 people. A total of 116 questionnaires were re-
turned from $04 mailed. The 116 questionnaires covered the
Operating experiences or 427 restaurants einoe several of
the businesses were Operating more than one unit.
The industry eurvey covered rive objectives:
1. Identification of major personnel problems.
2. Turnover among restaurant employees.
3. Training offered in the industry.
4. Information on wages, ealariee and fringe benefits.
5. Labor costs in the industry.
Getting employees of satisfactory caliber is the major

personnel problem. Motivating employees to do a satisfactory

George D. Bedell

job is ranked as the number two problem, and development of
supervisory personnel is the number three problem. Weaknesses
of supervisory personnel sore pointed out to be their ability
to motivate employees, their ability to organise the work of
employees and their ability to plan.

Personnel shortages are identified as a shortage of
qualified workers rather than quantity. The shortage of per-
sonnel exists primarily with skilled food preparation workers
and supervisors.

Communications between employers and employees is
mainly through supervisory talks, employee meetings, counsel-
ing and complaint systems. Only a minor number use merit
rating systems and interviews.

Turnover in the restaurant industry is at a very high
rate-est: out or ten employees are replaced each year. Of
these workers 38 per cent leave the industry voluntarily and
27 per cent are replaced because of unsatisfactory service.
The restaurant industry is held together by about 40 per cent
of its employees who are loyal and motivated by the business.

There is a disparity in shat operators say they think
of training and their actual practices. 311 out of ten say
they think training is very valuable,thres out of ten consider
it to»be fairly valuable,'while one out of ten say it has no
value. Only half or those surveyed reported any on-the-Job
training, and only 25 per cent reported complete training

programs. A complete training pregran was indicated as more

George D. Bedell

than onothe-Job training or an orientation program for all em-
ployees. More and more restaurants are using outside training
agencies as a source or employment.

The average labor cost of all the restaurants surveyed
was 33.7 per cent. Fringe benefits offered by the restaurants
ranged from 6 to 15 per cent or the sales dollar. Considering
the fringe additions the true cost of labor would average close
to 40 per cent.

Almost a quarter of the operators stated that over the
past ten years they have given wage increases to motivate
workers to do a better Job. About the same number have given
increases to obtain better quality employees. Twenty per cent
reported giving wage increases to meet competition from out-
side the restaurant industry and 15 per cent granted increases
to meet competition from within the industry. Ten per cent of
those reporting gave increases to meet union demands.

The one resource in the restaurant industry which has
not been effectively develoned is personnel. These problems
are not going to solve themselves. Hanagement must assume its
responsibility or creating more efficiency in the business.

The development needs to start with tap management. From this
point, the greatest effort should be exerted in the develon-
ment and training of supervisors who can help share the manage-
ment burden. Only when these phases are accomplished can
preper attention be focused on the workers and concentration be
pinpointed to training the employee for maximum productivity

and efficiency in the restaurant.

A STUDY OF P172330 EM‘IL PRACTICES
ARI) T513333 IR LABOR COST
35.0230 3‘3 CifiSFUL RESTAURANTS

By
George D t B36311

A THESIS

Submittcd to
mohlgan Stat. Unlvorsity
in partial fulfillment for the requirement-
ror tho dogru of

"ESTER OF ARTS
3323001 or flotol, Restaurant and Institutional Mnnagomt

1983

TABLE OF CGHTENTS
Pug.
Graph“-
I. IH'I’ROD'JCTIOKfi MID TIE SURVEY LETHOD . . . . . 1

II. IDEEWIFYIHO THE PERSGNKEL PROBLEMS OF
mmnus'rax .n.c¢tcootcoo¢¢ 13

In. ransom 13 THE ngsmunam Imvsmr . . . . 23
Iv. TRAIRIHG owmm m mm: maus'm? . . . . . .
v. mans, saunas AHD ’maori cos'r . . . . . ..
VI. aux—my mm concwsms . . . . . . . . . .

88$

BIBLIOGRMHY . . . . Q C . . . C . . . C . . . ‘ . Q 56
APPENDIX 0 o o u o n o o o o 0 O o c o o o o o a o o 59

11

TABLE
1.

2.

3.
4o
59

6o

7.

8.
9.
10.

11.

13.
14.

15.

16.

LIST OF TABLES

Oscarsohio Distribution of Sample Question.
nnlro Hailed and Returned 9 s I o I" I 0 U 0

Distribution of 118«Qusstionna1ros Completod
and Rsturnsd.by SOPV10. TYPO. o o o o o o 3

Your: as a Buslnoss Enterprise . . , ¢ ¢ 0 0
Seating Capacities or the Sample Group . . . .
Union vs Roanhion-fion~fionagomsnt EmployeOI .

flhnngomonts Views of the Personnel Problens of
the Restaurant Industry Ranked by Important.

Improving Present Supervision weaknesses of
Present Supervisory Staffs . . . a o o - o .

Primary Psrsonnol Shortngos . o . I . . . . .
Personnel Responsible for Selecting Employees

Background of Executives in thsrRostaurnnt
Industry 0 s o s a o o o o o a s s o s s s

Previous Business Exporionoono-Othsr Fields .
Finding Out What Employees Think About Their

JObOOOUIOOGOOIOO0.0IOOI
Informing tbs Employees kbout the Business 0

Turnover among Employees both Union and Homo
Union 0 o o o u s o o s o o o o o s o o o -

Fag.

0!

0049

13

15
17
19

21
21

23
8‘

Primary Reasons Given for Replacements or Additions

to Staff-aTOn Ybfirl V10. o o o s o o a o 0

'Yoors or Employment--Averags Tsnurs with
Reporting Companion s o o a o C o s o o o

111

8?

99

21.

22-
23.

24.

iv

Estimate of Value of Formalissd Training 0 s 0
Kinds of Training Offered Employees . . . . .

Estimated.Timo Hoodsd--Hburs of’Training Nstdod
to Reach Efficiency on the Job 0 . . . o s o

Frequency of Use of Outsias Training Agsnoisl
as a Source of Employment 5 . s . . s s . .

Current Relationship between Sales and Labor

Cast: a s a o s s s s o a i Q 9 O O O o s O

Fringe Benefits Offered by 8&mp10 Group . . o

Estimated Tips and Gratuitissanaslstionship
toEsrnsdInsoms o s so too... so)

Wags Inoronses Granted During Last lO'Isars -

35

38

38

46

48

CHAPTER I
INTRODUCTION ARE THE SURVTY METHOD

In the past, successful rootouront Operation has been
identified with, and based on the constants of good food, good
service, pleasant atmosphere and prepor pricing. Present day
economics dictate s realisation that the variebles in success-
ful restaurant Operetion go far beyond these four basic funds-
mentels. It is recognised by ell sssocisted with the food
service industry that more is known about failure in this field
than about success. fishy publications deal with failures and
the omisos, but few spell nit in s speeitio way nby'restsurents
offering similar services and prices both succeed and foil .
within close proximity to eaoh other.

The restairont industry is a huge complex, dwarfing in
size such industries as steel, automotive, electronics, and
many others, yet the typical unit in the injustry is e small
business. Over three hundred thousand of these individual
businesses makedup the complex.nhioh.is known as the restauro
snt industry.1 It has long been a foot that the individuality
of America‘s small business entrepreneur creates a considerable
barrier to the exchange of information leading to the develon~

meat of principlos in business. nevertheless, s study in this

 

W

1Hationol Restaurant Association, Earketing_fiegor§
(Washington, D. 6., bay 16. 1961), p. 3.

l

2

industry'whioh employs more than a million and a half peOple
and which now occupies such an important place in the market-
ing of food in America should produce a profile and be helpful
in identifying basic practices in the industry.1

This study is devoted primarily to a better understand-
ing of the philosophy of manegemont in the industry as it is
reflected in personnel practices. Personnel practices and
labor costs, which are completely inter-related. are of para-
nount importance to successful restaurant Operators. It is
increasingly more evident that in the restaurant industry the
first need of mmnagement is sound personnel policies and pree—
tioee which lead to greater human efficiency and more signifiu
cant control of labor costs. This study, therefore, is
undertaken with the following objectives in mind:

1. To identify the major personnel problems of
the industry.

2. To examine the turnover problem among restaurant
employees.

3. To study the training offered in restaurants.

4. To compute information on wages and salaries.

5. To examine labor costs in the industry.

For many years the restaurant Operator has been caught
in the squeeze between rising labor costs and e rather inflex-

ible sales price ceiling.2 Because the industry is highly

 

1U. 3., Bureau of Labor Statistics, Egplozgeng Outlogg
in Restaurant Occupation; (1961). p. 730.

33. Terry Radigan,‘zhe Restaurant Induet (Washington.
D. 0.: Rational Restaurant Association, 96 . p. 1.

3
competitive, increased costs are only slowly passed on to the
customer. The restaurant Operator feels that his oustommrs
will accept price increases on almost every product which.hs
buys, but will not accept increases in restaurant prices. The
operator, being fearful of loss or business, is more apt to
offset additional labor costs by attempting to reduce other
costs than he is to increase prices.

The technoloay of the restaurant industry is only
slowly develoying. The fact that labor costs ere rising five
per cent per year indicates that the productivity or each em»
ployee is not rising commensurately with wage and salary'in-
creases.1 Workers in the restaurant industry differ little

from those in other industries.2

Though their motivation and
attitudes have never been studied satisfactorily, there is little
reason to doubt this statement. What they lack are the tools

and other devices to raise their own productivity. This study

is not concerned with this particular phase of the prdblem.

It's major concern is with the human organisation and the tech-
niques used by Operators to manage peeple. The heart of the
personnel problem is management’s ability to irect the efforts
of its peeple and increase the worker's efficiency.

This study is based on information obtained from.e ques-

tionnaire consisting of twenty basic questions and on an

 

1Rational Restaurant Association,‘Washington 399922
(washington, D. 6., September 11, 1961), p. 1.

3mm”: c. Finlay, A. a. Sartain, and mm s. Tate,
Human Behaviorhin Indueggg (Hew‘Yorki McGreecflill Book 00..
T955), pp. 201-212.

4

appendix covering the background of the respondents. The
questionnaire was'mailed to 404 selected restaurant businesses
throughout the country. Broadly speaking, the information
sought through the questionnaire included the following:

1. Identification of the type or business, their
managers and employees.

2. Personnel problems that are common in the industry.

3. Turnover in the industry among various classes of
employees.

4. The types of training presently offered in the
restaurant industry.

5. Wages, salaries and fringe benefits.

6. The broad problem of labor costs.

Table l is a breakdown of the total sample mailed. Ap-
proximately 28 per cent of the questionnaires were nonpleted
and returned. The returned samples were carefully checked for
completeness and validity. Certain questions provided a cross-
check on the accuracy of the information supplied. The informse
tion from.116 usable questionnaires is included in the tabulated
results. The information found in this study is based on a
cross-section of types of successful businesses, based on years
in operation, and their practices. The data comes from inde~
pendent shall Operators as well as the presidents of large
chain restaurant organizations. A deliberate attempt was made
to obtain information from many of the most prominent menbere
of the restaurant industry. Replies were received from highly
respected f‘rms who have a known reputation for sound manage-
ment. Some of America's foremost restaurant Operators co-

Operated in supplying the information.

TABLE 1

63003492113 DISTRIBUTIQN 0P 3 f‘fPLI-I
Q5. S'I‘ICJIIZ‘IAIEEE 323133.511) MID RE'I‘LT‘ih’IzD

‘—
w v . v“— W

 

 

 

 

Percentage Percentage 50. of Res-
Geogruphic of Total of Total taurcnts in
Distribution mailed Returned Operation”

1. Rev England 12.4 8.6 19,545
2. Kid Atlantic 17.4 12.9 76,670
3. South Atlantic 19.3 12.9 36,741
4. Earth Central 50.0 30.2 113,215
5. South Central 4.9 14.7 44,793
6. Mountain 4.9 8.6 14,151
7. Pacific 9.7 A 12.1 39,625
Total 100.0 100.0 344,740

“1958 U. 5. Census of Business

Table 2 is a breakdown by restaurant types of the 116
returned usable Qiestionnsires. The restaurant industry can
be subdivided into perhaps 25 identifiable types but few res~
tsurnnts offer e single type or service. Most offer two or
more related but different types of service to their customers.
Herertheless, to assure that the sample covered e wide cross-
section of the total industry, questionnaires were mailed and
replies were received from cafeterias, table service, spo-
cislty houses, fast food service, industrial catering, lunch

counters, drive-ins, snack bars, and others.

TABLE 2

DISTRIBUTI‘H OF 116 QULSTIOfifiAIRFS COfiPLCTED
AND RETfififihD BY SERVICE TYPES

 

 

 

 

 

=Efi; -mw. ~M_ f 7 “£3
Types of Percentage
Restaurant! of Sample
Cafeterias 18.9
Table Service-olndopendent 21.3
Table Serviooo-kulti unit 10.9
Specialty Houses 12.6
Peat Food Service-oDrivouln 11.5
Industrial & Executive Feeding 5.6
Clubs . 6.5
Sandwich-uLunoh Counters 1.9
Snack Bars ‘ 1.9
Coffee Shop: 1.9
Employee Canteen 3.5
Dairy Lunches 3.5

31.31 fiioatipn 01:12:23 Respongontg.

It is, of oourso, impossible to identify respondents to
a questionnaire in a composite summary. Each of the inaividual
respondent: has boon assured that the information auppliodby
them would be held in oonfldenoo. Kevorthalosa, discussing ocrv
tain characteristics or the businesses included in the samplo
will be meaningful to the reader.

Table 3 indicates that the organizations included in the

TABLE 3

YEARS AS A BJSIHESS ENTERPRISE

“ .o-mv ' ' w M

A...

 

 

Years in 80. of Percentage

Business Restaurants of Sample
51 or more years 9 7.7
41 to 50 years 6 5.2
31 to 40 years 11 9,5
21 to 30 years 12 10.4
11 to 20 years 42 36.2
6 to 10 years 26 82.£
5 years or less 10 8.6

Total Sample "‘-

116 100.0

Range 1 to 80 years
Average years-~21

Radian-~25 years

 

sample are mature businesses. Two out or three of the organiza-
tions supplying information for this study had ton or more years
of business history. Only 8.6 per cent or the sample had less
than five years of business experience. Collectively, the
sample group reported over 1500 years of business history.

This last figure should impress the reader with the {not that
the practices reported upon in this surrey have been tested in
times or labor surpluses and extreme labor shortages. Since

no single year in the last twenty can be called typical or

TABLE 4
SEATING CAPACITIES OF THE SAB‘FPLE GROUP

 

 

 

 

No. of Total Average

Locations Ho. Seats Seating
Single Address 31 6,521 204
Two Addresses 24 4.405 184
Three Addresses 28 5,899 _ 200
more than 3 Units 344 68,800 200
TOTAL SAXPLE 427 86,125 199

average, the views expressed by the sample group become much
more meaningful with this in mind.

in identification of size of the businesses whose ex-
perience is reflected in the sample is supplied in Table i.
The 116 questionnaires cover the Operating experiences of
427 restaurants with a total seating capacity or 85,125.
Three hundred seventy-two or these restaurants were in groups
Operating in three or more locations. Thus the nonple is
biased toward the experience of chain organizations. Yet the
entire study is Justified on the basis that chain organisa-
tions are usually the leaders in Applying the latest manage-
ment techniques. Independent Operators usually pattern their
practices after those of the chain organisations. Furthere
more, it is the chain organization that is subjected first to

unionization and the effects of federal and state control.

9
Since these people are leaders in adapting personnel practices
and since the independent competes with the chain, their pres.
tlces are of immense interest. The average restaurant as is
indicated in Table 4 had 199 seats.

There was very little variation in the sise or the rose
taurants reported upon. All fell within the narrow range of
184 to 204 seats. Twenty-four thousand, two hundred fifty-two
regular employees are used in the operations of these 427 ree-
taurants. An additional 3,473 employees are used on a seasonal
basis. The typical restaurant in the sample euplcyed 59 regular

employees and B on a seasonal basis.

TABLE 5
UBIOH VS ECHoUEIOfl-QBCH-EAHAGEEEET EfiPLOYEES

._ .. ...._...... A

Percentage of

 

 

Representation Total 33mp1.A”#
Ho Union Contract 55.3
completely Union 18.9
Bone Union 25.8

Total 100.0

UHIOE VS “UH-33103 RT?RES?ETATIOH
HUMBER 0P EHPLOYEES

 

Union 15,165
Ron-Union 9,087
Total 24,252

Table 5 indicates that 55 per cent of the sample group
had no union contract. or the remainder, nearly 20 per cent

10
(18.9%) were completely union and 25.8 per cent had contracts
on one or several classes of employees. 0: the total number
of regular employees reported upon 15,165 belonged to unions.
Rine thousand eighty-one were non-union.

There were no questions included in the questionnaire
requesting information on investment in the restaurant unit.

In a previous study the figure of $1,000 per seat per seat was
estimated as the average cost in building a modern restaurant.
On this basis, the sample group invested $3,389 in order to
provide a job for one employee.1 Since compilation of this
data, estimates on average cost per seat have increased to
$1,500.”

In studying this report, the reader should always hear
in mind that the sample taken was first of all from.very suc-
cessful restaurants with long years of experience in the field.
The vast majority of the restaurants reported upon were chain
units. Ho claim is made that these restaurants are better cp-
erated, more profitable or have better employee relations than
the independents. however, chain organisations tend to have
rather uniform and standardized operating policies and prose-
dures. Because of this, the study of their personnel practices
is easier and more practical. A rather large group of employers

and their practices is reported upon in the chapters which

1Donald Greenavay and Gertrude Blaker, A Study of tn;
For handisine Exocrienoe in Five Classes of Successful Reg,
taurantg White ?lains, H. .8 General Foods Corp., 1958).
p. e

2Interview with 3am Horvits President, Equipment Mfg.
60., Chicago, Illinois, Hovember 15, 1962.

   

11
follow. Chapters II, III, IV and V report and discuss the

data compiled and tabulated from the questionnaire.

CHAPTER II
IDIZPETIZNIHG THE PERSGIEEEL P30331353
OF THE IICDUST Y

Overwhelmingly, peOple connected with the restaurant
field state emphatically that there is an ever present and
growing shortage of satisfactory employees in the industry.
In personal discussions with management. the pattern of their
comments is remarkably consistent. Regardless of geographical
area and regardless of the size of the Operation, presidents,
general managers and supervisors say the same thing.

Hanagements' views or their personnel problems are set
forth in Table 6. An overwhelming majority of the respondents
identified a shortage of employees or s satisfactory caliber as
the first personnel problem. fictivation of employees ranked
second. Actually, this is s restatement of the first premise.
Dissatisfaction with present employees here is stated as law
motivation. Management's answer would be that it satisfactory
employees could be faced, the motivation problem would disap-
pear. Again. viewing industry’s prdblems through management's
eyes, the develoPment or supervisors ranks third in order or
importance. A close examination would indicate that the first
three problems are interrelated. Management views the develop-
ment or supervisors as a difficult problem since they measure

supervisory ability in terms or deveIOping a staff and motivat-

ing workers. Since employees of satisfactory caliber cannot

12

13

f 1'"
T A I} 5.4 4':

i-Llfi AG 7" 3.1“? T3. VI 22273 OE" THE PEER SURF-51L FR 01511.? MB
OF THE RTTSTA'ZIRILNT ISDJBTRY RAIIK'ExD BY IMPORTAHCE

 

WV w v—v—w
“—‘fi— .4..—

% Selecting

 

Identified Problem Rank Each Problem
Employees of Satisfactory Caliber 1 7d.2
Motivation of Employees 2 63.8
Development of Supervisory Personnel 3 d6.5
Training of Non~Managcment Personnel 4 34.5
Selection of Supervisory Personnel 5 27.7
Turnover (Food Prep. Personnel) 6 24.1
Turnover Among Service Personnel 7 18.5

be found, those supervised cannot be properly motivated and
thus the problem continues. Training or nonumanegement per-
sonnel is a function of supervision. Turnover often is at-
tributed to poor supervision. Thus, the entire table and the
ranking of the problems is symptomatic of the sane thing.
Poor selection, poor training and poor motivation are blamed
for the continuing and never ending shortage of qualified per.
sonnel at all levels.

No survey so far undertaken has indicated that there is
a quantitative shortage of personnel. Every job is filled,
but management continues to seek highly qualified Operating
personnel at all levels. The implication here is that the
shortage is qualitative rather than quantitative. The search

14
for qualified executives, supervisors and skilled peeple con-
tinues unebated during periods of peak prosperity as well es
'during periods of recession. Almost every company reporting
in this survoy'indicated that they would hire highly skilled.
highly nativeted cooks, bakers, food supervisors, assistant
managers and managers if they could be located.

Up to this time, it has been difficult to measure the
Quantitative needs for personnel in the restaurant field. An
annual addition or 35,000 skilled and supervisory personnel is
perhaps e conservative eetimete.1 The present level or train-
ing offered in the industry end through education is evidently
not meeting the needs.

In connection with the development of supervisory per.
sonnel, it is interesting to note whet menegzmont thinks shout
the weaknesses of their present supervisory staffs.

Table 7 identifies the weaknesses, and ranks then in the
order of their in:port:;xnoe to mono! ment. The ability to anti.
veto the employees ranks as the first problem. Frequently,
discussions with management peeple produce comments to the era
feet that present day employees do not care to work and are not
interested in their Job. It is apparent from Table 7 that e
part of the blame for this sttitude is assessed by management
to lack of ability on the port or the supervisors. The second

and third major weaknesses of supervisors is the some things

 

1McKinsey & Co., A .esesro Stzdv to Improve he Sn

Cook nd Eek r8 for the Benefit of the ‘
iéfirfelo, i. Y.x The Stetler E‘oundetion, 1955 , p. 5.

  

 

 

 

15

TABLE 7

mmovnm szsxrw 3*; mam/I310}: $.1-CAI’INLTSZSIZS
09 IN: sunmvw-om smxap's

 

 

 

 

 

 

a==a*fl—Ea_..n~pwgE*u1=======================§=giifijing as M6:;-
Identified Woelmeaseo Rank Important would)!“
Ability to Motivate Employees 1 31.0
Ability to Organize Work of Employees 2 29.3
Ability to Plan Work 3 14.6
Overall Job Knowledge 3 14.6
Carrying Out Company Policies 4 13.8

....~ A

lack of ability to plan and organlzo the work or employaes.

Any management, whether in the restaurant field or in othar
industrlaa, $0113 probably say the same thing about their In-
porvlaors. Lack of Job knowledge ranked equally with tho lack
of ability to plan work and ranked as the third identified
wcaknoan. This tenda to indicate that restaurant supervisor-
1n the main know tbair Job but cannot plan and organize the
work or employees and motivate them to do their Jobs. Also,
this tends to point up the fact that supervlaoro' greatest
prdblem in the rastaurant field 13 mainly in the area of manag~
lag peeple rather than in the need for further devoIOpment of a
high dogroo or technical aklll. It would team that the restauro
ant industry's aupervinora arc oriented upward toward their
bosses in management and that they do conform in general to

company policies. This is borne out by the fact that failure

16
to carry out company policies ranks down the list as the fourth
vastness. end not e major one et that.

If these views of management are typical of the industry;
then it can be assumed that the supervisory talent now in the
industry has sufficient Job knowledge and is able to curry out
company policies but looks the ability to plan the work of can
ployeee and motivate them to do s good Set. One reason for
this has already-been pointed out as the continuing and never
ending shortage of skilled peeple from.which to select tho
best. In management's eyes, the best certainly include:
peeple with built-in self-motivation.

Earlier it was stated that a qualitative shortage of
quslified personnel is the major personnel problem of the in-
duetry at this time.

Table 8 tends to bear out this statement. It can be
seen that the~ehortagee referred to exist among skilled food
preparetion workers (cooks, bakers, salad makers) supervisor:
of‘ell olsssee and service workers. Almost half of the respoad~
ente (48.8 per cent) identified the first two classes a: the
area: of greatest ehortage. Only'ebout 1‘ per cent of the
sample reported a shortage of service workers. Nearly 12 per
cent of the temple reported shortages of office worker! and
12 and 1/2 per cent of the sample reported difficulty in find-
ing sanitation workers. There is obviously little shortage of
unskilled people.

It is interesting to note that the shortage of skilled

food preparation workers continues unabated as a oorlddwide

17

PRIMARY PEERSONRIZL SHOHTAGES

 

 

 

 

Lbhortsgss by Tyfili’ gfiof Sample
Skilled Food Preparation Workers 26.4
aspervisors 28.4
Service Workers 13.8
Office Workers 11.5
Sanitation Workers 12.5
Unskilled Food Preparation Workers 6.9
Oth.r' 6 s5
Total . 100.0

shortsge. The Ststler report stated that hotel managers and
executive chefs tend to think of this shortage in terms of the
difficulty of finding experienced, versatile and highly trained
chefs who had been brought up in the Europeen tradition.1
iotaslly, however. the need for highly skilled peeple cuts
across sll food preparation Jobs in the kitchen. The need st
the time of the Stetler report see for top chefs, cooks and
beginners. This report contained an estimate that there were
860,000 cooks and bakers employed in the hotel and restaurant
industry in 1950. Of these, 320,000 are employed in resteuru
note. This report estimated that 18,000 trainees were needed
annually for these skills alone. The level of skill of the

IRE-gs. p0 2.

18

cooke and bakers in the restaurant industry determines to 1
great extent the quality which America‘s restaurants can build
into their products. A large segment or the restaurant in-
dnetry constantly races the problem of replacing over-aged
ekilled people with unekilled beginners or with employees with
little training.

more and more the restaurant industry ie learning to
rely upon the ckill or the supervisor for the maintenance or
quelity food, for productivity. for satisfactory service, for
human motivation of employees, for ccet control. for record
keeping and myriad other duties. Thus. the need for more
highly ekilled. experienced and capable supervisors. Dieentie-
faction with.preccnt eupervieore indicates that if anything the
shortage in qualitative here more no than in other areas. fibre
supervisors are being used today in the industry'thon ever‘be-
tore, yet the development, training and retaining or this close
of employee has been studied very little by management.1 There
are special school: and college level programs for manager:
and numbers of training progrcme for ekilled type personnel.
but very little attention has been given to thie problen.cree?

Table 9 euppliee the answer to e eerie: or interesting
questione- The beeic question ie: ”Who ie reeponeible for the
eelection of the people employed in the reetenrant?‘ The unever

supplied in Table 9 is probably not typical of the induetry.

1Donald Grecnaway, Develooin. Strcne Food Staff (Chicago:
Rational Reetauront Association, 1962 , pp. ~4.

 

23cc partial list or pragrame in bibliography.

19

TRBLE 9

‘
Q“)
SELECTING EMPLOYfifi

 

 

 

 

 

 

 

 

 

==: tr fizw' ‘ ~ _ ;: ¥ 4 ~:====
Company Official t or Sample
Chief Executive or PrOprietor {4.8
Personnel Director or Interviewer 80.7
Supervisor 43.1
Others 10.3
no.9"

 

“Sample totals more than 100 per cent since some one
players use more than one individual to select employees.
This table indicates that the chief executive, the preprietor,
the personnel director or an interviewer share the responsi-
bility about equally with supervisors and others in the celec~
tion or employees. In the typical chain organisation. company
executives select managers: managers select supervisors end ape
parently about oneehalf or the other employees. The supervisors
select the employees under them in about half or the cases.
since there are few companies that employ a full time personnel
director end/or interviewers, it becomes obvious that most of
the employees selected for the industry are selected by peeple
who normally have little formalised training in the processes
of selecting employees.

Unfortunately the restaurant manager competes in e di-

minishing pool of trained peeple with the department store, the

20

industrial operation and others in the community on an unequel
basic or skill in eelecting the right person for the job. Be-
cause the restaurant manager in busy operating the restaurant.
mneting customers. talking to sales people, handling personnel
problems, taking cash, doing accounting and nnny other taste,
it ie doubtful whether he has good sources of employees.
Furthermore, he ie apt not to be able to conduct an interviee
and hire the right person for the Job. Ir‘he ie ekillrul, it
is probably because of his long experience in deeling with
peeple and his intimate knowledge or the Job. It can be ee-
eumed therefore that one of the basic prdblems or the restaur-
ant induetry could be aided by more ettention by management to
the fundamental techniquee or selecting employees.

An interesting view or the background of the executives
supplying information for this survey is round in Table 10 end
Table ll. The typical executive responding to the question~
neire has been in the business nineteen years. It can be
eeeumcd from Table 10 that our informants were nature expero
ienoed people. Their Judgments of peeple and their ability
cannot be questioned in View of their background. ‘Yet, through-
out the study it will be shown that even executivee of the in-
duetry would benefit from further formal or informal etudiee
of their own businesses. A tremendous dividend would result
from e further study or personnel problems and management
techniques which have evolved in the more highly organized in-
dustries. Not surprisingly, almost two thirde (64%) of the

peeple who answered the queetionneire come from other fields

21

TABLE 10

BACKGROUND OF EXECfiTIVUS
13 Tu: Hrsrauaamr IFDUSTRY

 

Experience: E0. of Year!
Wcrker Level 9 +—¢ months
Supervisory Level . $‘+ 2 month!
management Level 6 +-6 months
Executive Level 7

Totel'Yeare 19

 

 

TABLE 11

 

PREVIOUS auarmrsa Exaaarsncas..
OTHER FIELDS
g of Sample
Other Business Experience 64.0
Only Restaurant Exparienee 36.0
100.0

to the restaurant induetry. Another 36 per cent or the
sample had all or their working experience in the restaurant
field. Sixty-four separate field: of endeavor eontributed
executives, managers and sapervieore to the reataurant field.
fioat or the background fields however, were other small bull-
nee: fields. Very few professional peeple leave their fields
to enter the restaurant business. fiany or today'e restaurant

manager: started in other fields as workers. Many others were

23

supervisors or minor oxcoutiveo and a few were skilled workers.

Integrating tho information found in Tables 10 and 11.
leads to the concluaion that the typical respondent probably
had little experience as a worker in the restaurant industry
and not much experience as s eaporvisor before moving to a
managamont or executive position. Because these people did
not experience being ”banned,“ but were bosses from their
entry into the field may indicate why tho gap in understanding
exists between management and unskilled workers in the industry.

In a later table, it will develop that it requires as
much as 500 hours of training to develop a supervisor or ee—
eistsnt manager and upizo 5,000 hours or training to devalon a
manager. Table 10 tends to verify that these estimatoe are
conservatively correct. Today's restaurant managers are more
apt than not to come from some other industry and to spend
only a short time as a worker or supervisor before‘moving into
a manager's position. Typically. their background is iable
to'bc rock in supervisory skills and personnel handling. Ben
cause or this gap in career dechOpmcnt, they are apt not to
be skillod developers of supervisors.

Frequently, it is euggcsted that better communications
would solve such problems as employee motivation, training,
acceptance of policy, etc. Table 12 indicates that the most
common methods of communications between employora and employees
in the restaurant industry is through supervisory talks, em-
ployee meetings, complaint ayatcms, etc.

Surprisingly, a sizable nonber of these highly organized

23

TABLE 12

FIRDIRG OJT nee? EXPLOYEfiS THIRK
-C?T THEIR JOBS

 

' ’ r_. v 7—— ' ~H-e-d-W‘ . no: -A phrt—In‘e‘flf'quMW”*G--‘~
f .- .9 V“ n —- . -v-e- ~I.ml- & .e »- »‘~\.-—3r¢ -.->' .v-Jm-nuu-u-‘r flav"‘WWV"d—h - A ‘ ‘NW.

w .
w. :.--v‘~'*"’ —'

 

 

 

Method Used % of Sample
Employee-n839ervieory Talks 39.6
Employee testings 38.8
Rnployee~Counsslor Talks 33.6
Complaint Systems 12.9
Merit Rating Talks 11.8
Attitude Surveys 3.4
No Policy 25.9

Total 165.4%?

‘— “w —— T

‘Sinoe respondents use more then one method, total adds
to more than 100 per cent.
businesses mmke no attempt to find out from their employees
that they think about their Jobs. Only e minor number of those
reporting indicated that they use merit rating systems and in-
terviews afterward with their employees. Yet the vast majority
of the employers in the 427 restaurants do meet face to face
with the employees to discuss their job, working conditions,
hours, etc. In a very reel sense, this table is encouraging
because it reflects s shift in management's thinking from the
day when the employee never spoke to the boss stout his Job to

the present when most of the employers sit down with their

24
employoos at some time to evaluate him as an employee and his
performance on the 10b. Tabla 13 18 a further oxtonalon of

the information supplied in Table 12.

TABLE 13

INFORMIRG THE lififPLOYEES
ABOUT THE 81531121388

W

 

flbthod % of Sampln
Bulletin Boarda 44.0
Personal Contact 44.0
Employee fleeting: 42.1
House Organ 17.1
Suggoat10n-3yatems 16.4
Other: 6.9
Total 170.5%“

 

4’Total of % of lamplo morn than 100 per cent becaucc
respondents use more than on. mothod.

Through bulletin boards, personal contact and hon-o
organs, information 1. being passed dovnward from maoagement.
An evaluation of both table: would indicate that communion-
tlona 1n the restaurant industry have moved out or tho'hark
Aged'and mare nearly approximate the level of employer-employoo

communications in highly organized businesses.

CEAPTER III
TURNOVER IN THE RESTAURART INDUSTRY

Among the generalities frequently dieoueeed by roe.
taurent man is the statement that turnover among restaurant
employees is very high. Gueeees are frequently made that the
turnover rate ie 100:3 in the industry every year. 01’ eouree,
euoh gueeeee cannot be eupported by root: for no official
figures are available on the total inouetry. nevertheless,
because the rate or labor turnover is both a measurable evi-
denoe and an expreeeion of unrest and.beoauee turnover reieee
the coat ot’doing busineea, it is apparent that some infOPMI~
tion is desirable on this question. The coat of’hiring, lope-
reting and replacing employees in not insignificant in any
bueineee. Some turnover is inevitable end even delireble. it
email turnover when bringing new blood into the induetry for
example can be very deeireble. High turnover on the other
hand. can in iteelr‘be a serious problem to the individuel
bunineee men and to the industry. Today more end more employers
are becoming conscious or the direct coat of turnover beeeuee
or the nationuwide program or unemploymont oompeneetion end
the eetobliehment of merit rating provinione in all etetel.

If the experience or the eample group is representative
or the Whole industry, than six out of ten employees are re.

placed each year. The information in Table 14 of the total

25

26

TABLE 14

{marrow-«:22 more no? Lounge
BOTH UNIOH AND RON-UNION
W :zzi w
Representation Total Employees Replacement fl’Turnover

 

 

 

 

Uhion 15,165 9,551 62.9
Ron-Union 9,087 5,262 57.9
24,252 14,813 61.0

_.__1 i *

group or employees bears out this statement. It is interesting
to note that the separation or replacement rate is nearly the
same for union and non-union employees. Xonaunion employees
were replaced at the ennucl rate or 58 per 100 and union emu
ployees at the rate of 63 per 100. This is a staggering fig-
ure when the total site or the industry is considered. Fur-
thermore, this figure points out the immense Job of management
in the restaurant field in finding, retaining and replscing
their staffs. On the surface, at least, it would seem.thst
there is great unrest and dissatisfaction emong restaurwnt en-
ployees. Highly organised industries requiring e great number
of skilled workers could not stand and would not tolerate s
turnover rate or such immense preportions. However, further
light is thrown upon the whole subject of turnover in the res-
tcurant industry when Table 15 is considered.

Respondents to the questionnaire were asked to give the
reasons why over the last ten years they had found it necessary

to replace workers. Disregarding eMployees who-Vere added on

27

TABLE 15

PRIEafiARY REEfiOES GIVT-CE-E FOR H‘LPIACEEELLZ‘ZTS
OR ADDITIGEES TO STAFF-@736 YIEIJW‘S VIE}?

 

 

 

Wat mm” J“ W
Reasons Slot Sample
To Replace Workers Who Leave 37.9
Additions to Staff-Business Expansicn' 23.3
Terminated, Discharged, Etc. 27.6
Increased Volume of Sales 11.2
Total 100.0%

M

”Sample does not include those who are added on s
seaoonal basis.
a seasonal basis the sample group reported that four out of
ten or the raglacemants (37.9 per cent) vere replacements for
workers who left voluntarily. Three (27.6 per cent) out of
ten or the replacements were necessary because of termination
of employees for unsatisfactory services. Twenty-three per
cent of the new peeple brought into the industry were added
because of expansion of the restaurant plant and an additional
11 per cent were brought in because of increased sales volume.
Thus, of the pacple who are brought into the restaurant indus-
try each year 38 per cent replace eorkcrs who leave and 27 per
cent replace workers who are discharged.

It Should not be concluded that all who leave a particu—
lar business voluntarily or who are oischargoo ultimately leave

the industry. Eany reasons compel workers to leave their jobs

28

voluntarily. fiany or the worker: in the industry'nre woman.
They enter the field, leave it and then return to it during
various periods in their life. Young women merry, have fami-
liee and then later return as a part-time or full-time one
ployee. Others find it necessary to nugmont the family inoome
and still othere return to the industry because they find it to
their liking. However, the tremendous number of peOple who are
hired to replace those who are discharged, indicates that find.
ing employees of a eotisfeotory caliber, training them and re-
taining them.in the industry is indeed e major prdblem. A
single restaurant worker such as a cook may change jobe fre-
quently in the some community and be rebired and discharged by
the employer a number or times. There is no central.elearing
house for personnel recorde of restaurant workers. Through perv
eonal experience of consulting with manager: or reetaurnnte, it
is evident that in many cases the work records and references
of workere are not oheokod before hiring. Thus, unsatisfactory
emoloyeee are not permanently needed out of the industry. The
U. 3. Bureau of Labor Statistics indicate: that the types of
personnel most frequently discharged or replaced are the un-
skilled peoole.1 Those with skill in food preparation and
eervioe, supervisors and managers. are stable employees and
remain with their employers over long periode of time.

Table 16 tonde to verify the fact that many restaurant
workers remain with aeingle employer for e relatively long

period of time. The managers of the 427 restaurants reported

1U. 3. Bureau of Labor Statietiea. Ooguoatione; Out.
look Handboqg, Bulletin 30. 1300.86, 1961, p. 3 .

29

TABLE 16

YEARS OF‘EMPLOYfiEHT *
AVERAGE TEEURR WITH REPGRTIRG COMPANIES

2:: v‘~ ~ A L -ww “3::

 

 

 

Average Time on the 36b _~ 5 of Seaple
O to 1/2 Year 3.7
1/2 to 1 1/2 Years 10.3
1 1/2 to 2 1/2 Years 10.3
2 1/2 to 3 1/? Years 13.8
3 1/2 to 4 1/? Year: _ 15.5
4 1/2 to 5 1/2 Years 13.8
5 1/2 to a 1/2 Years 12.1
a 1/2 to a I/Q‘Yeare 3.7
8 1/2 to 10 1/? Years 1.?
10 1/? to 12 1/? Years 3.4
Above 12 1/? 1.7

Total 100.0%

4”Sung/M based on experience: or 487 restaurants with
24,852 employeee. Averagea arrived at by dividing total regular
employees into total service time.
that the average length of service of their employees wee rele-
tively high. About 30 per eon: or the sample reported average.
or 2 1/2 years, or under. Forty-two per cent of the sample
had between 8 1/2 and 5 1/2 years average eerviee. Twentybone
per cent of the temple had 5 1/2 to 8 1/2 yenre of experience.

and eurprieingly nearly 7 per cent of the sample had between

3O
8 1/? and above 12 1/2 years of service. Considering that
these average: based on the service records of over 24,000 one
ployeee recorded by 437 employers, it can be eeen that a high
percentage of restanrant employees remain continually in the
industry, but that on even higher peroentage have been in it
and with one employer only a short period of time.

It can be concluded from the date that the restaurant
industry is paying a high penalty with labor turnover for its
failure to solve the personnel problem. It can also be cone
cluded that the restaurant induetry is held tagether by 40% of
its employees who are loyal to the industry, loyal to their em-
ployers and motivated to do their best in the intereet or the
business which providee them a living. It is true that the
turnover rate in the restaurant induetry in very high for many,
many reasons. It cannot be doubted that the industry*ie prob»
ably not considered to be e good place to work by e great numb
ber of its ”alumni' who inevitably transfer to other fielde of
endeavor. Unfortunately, the data developed in this queetion-
naire does not delve into the reeeone why so many peeple enter
and ultimately leave the industry. Perhaps it ie becauee they
were not particularly fitted for the induetry in the firet
place. Perhape it ie because they were given too little train-
ing and leave the industry early in their careers, before they
became adjusted to their jobe. In any event, employment in
reeteurente is thought of as temporary employment by*e vast
nufiber or workers.

Included in this category are the illiteratee. teen.

egere and female workers who in meat eaeee can easily quality

31
for the unekilled or eemi-ekilled Jobs in the industry. The
illiterate: tend to be Job drifter: or are replaced by more
qualified personnel in times of e plentifal labor market. The
youths are influenced into other industries by higher hourly
wages or more attractive hours of work. Female workers leave

employment because of marriage and family reeponeibilitiee.

CHA‘TLR IV

("735 ‘7 1r: 1:.” “’1'3'5 I:rf“"-“ t l’Twif’i.’ " "W" 1""
$ai31o‘l’ilIlB-J Uri-1‘4““) Id ii...“ lily’owliéy

Over the past fifteen.yocr3, the restaurant Operator
has become conscious or the importance of training for his cm-
ployccs. Apparently, as will appear in this chapter, training
has a variety of moanings to those in the industry. To some,
training moans merely hiring an employee, tollin: him.uhcro to
ho q his coat, where his work is located and than expecting the
employee to roach efficiency within the first few hours on the
job. On the other hand, coma rcataurantc offer an hour or so
of orientation savoring the simple things that should be known
about tho restaurant. such on procedures, policies (if such
are written), etc. Still others offer a plan of integration
into tho work program,nnd a atep-by-step increase in the amount
of information supplied to the employee. Hany offer orienta-
tion training, Job doacriptiono, policy mo uols, directed
training, daily training and rcfrosher programs. A row res.
taurnnts offer formalized class session: in which the learner
is empoaod both to a little theory and some practice in order
to increase his efficiency.

in tho main, restaurant Operators attempt to employ
poOplo with.previous experience in tho joba for which they are
hired. Tho Operator cXpeoto and nasomoo that efficiency, won

tivation and underatandin; oomca built-in with the emyloycos

1

32

33
because they are experienced. Today there are several vccno
tional, trcdc and specialized schools offering skill training
for restaurant employees. Several colleges and universities
are offering training for ritorc supervisors and manaEcro.
chovcr, those peeplc enter the business with a further need
for training in their future Jobs. Thus, training in the rca¢
taurnnt industry is widely talked about, widely misunderstood,
not too often planned and often regarded as the panacea for
all of the ills of the industry. Training is nocccsary, dc-
slroble, worthwnile and profitablc and ovary employee in ovary
cctcblianncnt does receive coma kind of training either nogao
tivo or positivc. It can be stated that those companies who
plan their training usually offer the best food, the best nor-
vice: and are in the long run the most successful. Tho widely

accepted value of training is reflected in chlo 17.

TABLE 17

ESTIEATE 0F V£L”E 0F FCRVALIZHD TRAIHIH

4— 4 ‘4‘—
wn'-um «cl-u“ h'hw" n. - /4 pucr-a --—1 ....,.~. ‘5 Av q'.v-w -. v... --.-A-a¢u- wnq~~a~ .unco- o- W V...‘.“ . fl. _ - __ A‘ m-.. ’0’.

Degree or Value S'of SaMplo

 

 

Very valuable 58.6

Fairly Valuable 31.1

Limited Value or No Value 10.3
Total 100.0%

Here, when the question was cskcd as to the rcspcndont'a
estimate of tho voluc of training, the overwhelming majority

(almost 90 per cont) indicated that they considered training

34
to be very valuable or fairly valuable. Only 10.5 per cent
of the soople believed that training was of limited or no
value. Thus, it can be seen that reetairent Operators are
firmly sold on the idea that training can help them in handling
their personnel problere. fiowover, when the date in Table 18
is examined, it can also be seen that many operators do not
carry out their convictions into actual practice.

Only one out of four (24.2 per eont) of the sample
group admitted to having complet- training programs. For pur~
poses of this survey, a complete training program means more
than on-the-job training or an orientation program for all
employees of the estebliehnent. It can be argued that busboys,
wereweshers, vegetable preparation workers and jenitore do not

re ulre treininm. But in the sample iron where complete train-
“ t P

 

 

in: is offered, it 18 offered to all classes of erployees row
gerdlees or position. Another 17.2 per cent of the sample had
orientation training only end 51.? per cent of the sample of»
fared only on-theujob training. It can be concluded from
Tables 17 and 18 that restaurant men are sold on training but
as yet they do not have a very clear pieture as to what kinds
of training are needed and how much or it would benefit them.
If this information were known, Operators would be on their way
to determining 1ho beet kinds of training for a given sitsntion.
In this respect the information supplied in Table 19 may well
prove to be the meet important contribution of this study.

The respondents to the questionnaire were asked to

closely estimate in terms of training hours required in order

35

TAELE 18
KH‘TDS 01’ TR 3‘; 13-3130 OIWZRED Iii-1P BUYERS

 

 

 

====1_ .: g:: A # - a_szzzz=zzzzaaz23====23==z=======223==3
Types % of :‘SAEIPIOW
On the Jbb Training 51.?
Complete Training Program 24.2
Orientation Training Only 17.2

No Training 6.9

 

T0381 10°00

TABLE 19

7‘31": .4233"? TI’r 1‘1"". K'I‘S‘DE'ID
EOUHS OF ThIL UHF"; JnD TO h ZACH
LFFICI‘"“"Y 01‘} T5173 JOB

 

2’ M M. A .4

 

 

Jbb Title Range in Hours Eadiln
Eanagar 300 to 5.000 800
Assistant Hanngar 150 ta 500 150
Supervinor 40 to 480 240
Hostaasos 10 to 80 58
Cashiers 3 to 40 24
Waitresses 10 to 96 18
Cook: (Trained) 40 to 80 24
Cooks (Untrained) 125 to 400 230
Waiter 16 to 24 16
Dishwasher 8 to 21 8

Emaboy 8 to 24 16

 

36
to produce an efficient employee in various 50b classifioau
tiona. Their estimates are expressed in this table. Depending
upon the oomploxity of the Operation, it requires from.300 to
5,000 hours of training to produce a self-sufficient manager.
Bearing in mind that a manager of a small businosa must have
knowledge of ouch employee’s work. it can be soon that he
needs many more than 803 to 5,000 hours of training. If the
manager rises through tho ranks from unskilled to okillod,
from supervisor to managomont, along this path a composite
total of traznlng nooaod asaumoo astronomio proportions.

The reader must boar in mind that those who respondod
to this questionnaire were in the developmental period of
their own careers approximately twelve years before they
reached the managomono lovol. ’heao people have a natural
tendency to boliovo that it is difficult to short-oirouit
training tins and to produce a skilled manager in fewer year:
than they thomoelvoo noodod to reach the management r010.
Thus, in part. the industry's problem in finding managers can
be expiainod‘by the attitude of'ito present management toward
the problem of training paoolo for oxooutivo r0108. Success-
ful companies are attacking the problem of finding worthy can-
didatoo and moving thom rapidly ahead through specialized
training to positions of rosponsibility. This suggests that
the restaurant industry can profitably oonoootrato more aha
tention on tho training of assistant managers and ouporvisorl
who will inevitably'bc tho managors and executive: of the fu-

ture. For broadly speaking what capabilities those poOplo

37
havc, their level of understanding or their specialized field
and their ability to learn groatly dotornino how ropldly tho
industry can expand and whether or not it can be highly oun-
tralixod.

In the pact, assistant managers and supervisors have
been selected from the skilled working group. This is l nctu~
rnl place to turn for poonlo who can supervise tho work or
others. Thoso pacplo already have demonstrated their own
32111 and their utility to lead pcOplc. However, it does not
nccocsarily follow hat a skilled worker always makes an dbl.
supervisor, for the supervisor works through peeplo rather
than with things. Boycnd this it must be remembered that tho
industrf is furthar worsening its overall peraonnel prdblcmc
by'thinning-out the ranks of skilled workers. Thus, the novor
ending ohortaac of Skilled personnel in this gigantic industry.

There is no particular pride evident on the part of
skilled workers in the industry in becoming skilled croftsmcn.
There are a limited numbor of societies or groups providing a
social outlet and a status uplift for the skilled workers in
thla industry. The trade asaociationa primarily exist for on-
pcrviaora and management poOplc. Only the unions offer an
outlet for the workers. Bearing in mind that the Judgment: rc-
flcotcd in Table 19 are those of mature, skilled managers la
the industry, it can to soon that the misunderstanding of the
word "training“ and its implicationa touches every facet of
the personnel problem of the industry.

Tabla 20 offers further reflection upon the attitude of

33

mnna3ement in the restaxrant inlustry especially toward the
whole subject of training. It is encouraging to note that

45 per cent of the sample frequently used outside training
agencies as a source of emgloyoes. Thirty-four per cent of
the sample used these agencies occasionally and only 24.2 per
cent of the sample have never used such agencies. Apnarently
there is growing understan ins; within the industry that
schools, (pri vats and ”a ”11 0). colla3es and universities sun
be a source of trained employaea. If there were mare sahoola

5 this type aerv1n3 the in 1uatry, tlxa f13uro for those that
use the schools would probally‘ba higher. If there were

rained «mployees aval able thr043h publia employment agencies
this would also have been reflected in the table. Considering
the limitatlcns racing; the operator in findingaaourca of
trained employoea, 1t 13 1nterestln3 to note that restaurant
Operators are becoming increaalngly aware of agfincies outside

of the industry that can h9lp.

TaB L 20

PREQUEYvY OF USE OF OUTSID" THA'IHIRG
AGENCI” 3 AS A SOLVE? 0F EMPLOYWMM

 

 

Use of Agency % of Sample
Frequently 43.1
Occasionally 34.3
Fever 22.4

 

T033111 10000

39

It is diff loll: to avoid generalities in speaking of
problems of an industry which cm;aloya a mzllllon and a half
peoplo. Careful observers tend to believe that the shortage
of sklllod poroonnol will continua to worsen 1n the years
ahead. During the next twonty years or so, the oupply of in-
dividxals whose a3cs ran :o from 25 to 45 will diminish even
though the popalation increases tremendously.1 At the cams
time, the nooda of the lndaotry will 3row an more units are
built in order to serve America's millions. The thrm
classes of employees presently of concern are mano3ers, super»
visors and skilled porzonnel. A3 a result of the strs n39 pho~
nomena of a docroasln3 szpply in an lnorcas£n3 poyulatlon, tho

rootamz anti m‘*3try's yrollcmo will woroon unless on attack 1.

LI.

made on Mb mp 0;lons on a hroafi front by educational institu-
tions and the tr ado assoclntlons.

Lanu3; ant education 13 of prime lmgortanoo because if
Hanooomn.t is not trainoi thorn will be no strength to tilt.»
down to supervision and tho employees. Education and training.
a responsibility or management, is only now realizing the ban.-
flt of sldo training sources to lmfiPUVO their internal pron

grams 0

 

' 13. 3. Department of Labor, ”onoowor: ghnllcnfe of tho
$969 8’ 96 p. 6.

CHAPTER V

9."? Fr“?! *3 an 9“ *wc- '23:! r Jr“: a any
tutu-«la, 314.13.31.43... n.) “MD Lc‘sndd 2,0033

In any study of tho personnel practices or an industry,
the subject of wages must inevitably'bc oonaidorcd. In order
to arrive at conclusions as to whothor the wage and color:
policies or the industry are sound, first considerationl*muat
be given to the Inaction which tho industry performs and whoro
it fits into the general ooonomy. Restaurant Operators both
defend their present practices and, at the some time, decry
their inability to pass on mmro or their sales dollar to
their employees. In general, the industry is oxtromoly conci-
tivo on tho whole subject of salaries and wagon. A papular
misconception or the rcstourant industry in tho~mdnda of many
people, who do not know the true roots, is that the industry
in general undorpcyu and ovorvvorkl its employees. This mmkoc
it easy to explain why employees of satisfactory caliber cannot
be round, trained and retained in the industry. This typo of
reasoning often is used when statements are made to the effect
that the industry attracts the untrained, tho ovcroagod, tho
maladjustcd and the unproductive or othor industries.

Throughout modern business history, it in conceded that
the consumer will pay more for a manufactured product than he
will for a service. 3.1: is easy to understand, for the can-

comer has little idea of the cost of producing an automobile,

4O

41

but. a Very real sans. of the coat of I puma of hamburger.
The price or a exp or coffee in America is probably the most
stable among all of tha things that the cansumer‘buys, and
consumsr resistance to price fluctuation is graatest where
he knows, or think: he knows, the product. Thus, tho restaur~
ant man tools that regardlesa of the level of his Operation
from the 15 cents hamburger to the $5.00 dinner. he 1: always
under the watchful eye of tha consumar.

Small businesses are always closest to the cansumer.
Their managers and Operators feel the street of the consumer‘s
evaluation of price mare readily than do the Oparatora of‘big
busineaaaa. In general, the public is little aware of the
factora which make—up restaurant costs other than the coat of
food. But the? are vary'finch aware of the upraad between tho
coat of the atcmk and tha ultimato cost of the Itoik dinner-

0n the average, the consumer will pay restaurant price!
which urn two to three times higher than the coat of the inn
gradients which go into the moal,‘but price resistance inn
creases in direct proportion to the basic prices an the oan~
aumer knows them and the price the restaurant charges for thn
amal. Lfiko the law or price in economics, the market decreases
rapidly as the price increases. Only a for brave soul! violntn
these simple laws of economics and, those that do. usually'try
to provido the aouaumer moro atmosphere and more aervieo to
offaot the increased price. The restaurant market 1! a nonal-
tivo prioc markot, and the restaurant man known that the Ameri-

can oonaumor is extremely tickle in granting favors.

oz

The last quarter or a century has witnessed a dramatic
rise in the portion of the solo: dollar that is passed on to
the employees, and concomitant with it a flooroaoo in tho porc
tion of the colon dollar spent for raw materials (food). In
the restaurant industry all tha‘ 13 loft or the solos dollar
above 70 to 75 cents spout n food and labor muot be carefully
protected. Ovorhoad coats, othor than food ona labor costs,
account for 15 to 18 combo of tho 32153 dollar. All rcataurv
onto that fall, do so boozuc' they cannot make a profit. In
99 per cent of those cases, food and labor costs push.hoyond
this imaginary barrier, with tho results that profito are
eliminated and tho husinoscoo fal1.2 Business failures in the
industry can be sold in largo port to roault from inability to
control costs. Today tho most 31 ficult cost to control is
the cost or labor. ‘Yot, in the face of thosc specific economic
laws of the industry, the rcctcuraot Operator continues to
question whether he 1c doing the right thing for his employees;
or more specifically, whcthor he can aurvivo if the delicate
balance between labor costs and profits is destroyed. The cur-
rent relationship between solos and labor cost in the ca? roo-
tcwrcnto reporting is found in Table 21. Tho median for the
entire ocmplo was a 34.0 1coor coat. About 75 per cont of the
sample group reported labor cost above 30 cents of the solo:

dollar. Surprialnaly, nearly 25 per cent of tho sample

_ MA.

LDoncld Groonaway, figct’s Coming_1n;§ho Futugg? (Gh1~
ccgo: fictional Restaurant Association, 1961}; pp. 5~16

zflctlonal Restaurant Association, Eorkotlng Report
(1383h1ngtm' D. 00, April 27, 1961), Do ‘0

43

TABLE 21

y- .‘I‘

B?.“.l'z’-£E?§II SAEflS .‘XITD Iélfififi COJETS

 

 

 

32"mr‘ _ - “sail —— m ”- HW* W
Labor Coats in Relation ?eroent of
to Gross Sale: Sample Reporting
20-33% ’ 6.93
25~SO§ 13.9%
30-55% 29.3%
35.4ofl 22.4%
43-455 13.9%
45-53; 3.5%
100.0%

Average Labor Best 83.7%
Median Labor 093% 34.0%

v. I“? -— w-w

 

w w m.-

*any‘raperted fringe benefits of 6-15 par cent or
salaa. some in namplo failed to include aalnrios of mantgara
and nuporvtsora;
reported labor costs ranging from 40 cents to 50 cant: of the
salsa dollar. All costs reported are basic dollar coats with~
out consideration of fringo adfiitions. These additions in the
aamgla group were raperted to range from 6 to 15 cents of the
sales dollar. If the lower figure is accepted an an average
for the inauatry, and thara is sumo justification for acceptu
ing this figure, it 13 apparent that in this very iargo group
of restaurants real labor costs in three-fourths of the canal
rangod frcm.36 cents to 56 cents. Considering fringe addi-

tlons the median closer to forty cents and oven the restaurant:

44
reporting tho lowest labor casts would have truo coats greater
than 25 sent: or the gala: dollar. This table offers compelling
evidence that tin 3 13 runn out for the inefficient, poorly
rnnaged, under capitalized, low volume Operation. It also pro~
vided fair warning to ovcn the bigrest and tHo most affioient
that poor organization, inefficient personnel and 103 mot1v3-
ttnn can quickly t1vn modest profits into net 103333.

Tao restLXrant Operator' 3 dilamna 13 neatly wrapp3d up
in the story told in this tabl3. How to pay more and at thc
3333 time {at mere in human efficiency. finavy industry r3180.
prodactivity per or ployeo tHrOHHH batter mach Ines, better in-
dustrtal angin3ering, more carof11 planning, eliminatian of
V8 ted motion, 31: ervisory trn ning, staff planning and dozen.
or other dwvinea. Put what can tha r33taurant Operator do to
{at more 3313: dollars with rarer but higher p323 3331030007
The D336 for a techn‘aal Hrsak-tbrcugh, for better 33H3nsment,
333 for 333133993 or a hifher caliber no longer 13 desirablewv
it I: a must.

3 gap between the efficiency of tha partially or quay
pletely 31t333t33 heavy inflqstrlss 3rd the 333H7n31333 service
1333333133 is ever 31333135. TH3 r33t33rant eparator cannot
solve this Hrcblem Hy‘h13331f. H3 mu3t count upon tHe toohnlo
:31 and business rezaarzHers 3333133536 by H13 trade 3330311-
tton with 311133 support $303 an tnzr a atnf 33331? cf interostad
:33 pliers of th. 1:133:37. 93 13 rurtH3r dapandsnt upon the
t33H31331 and Han‘c r33333cH c3nfllcted by the 30333333Ht and

seHeols to solve his 33331333.

45

Host restaurant Operators understand the foregoing ma-
terial. They too, clearly see what can happen ts more of each
dollar of sales is directed toward raising the level of salara
133 and wages in the industry; Restaurant men resist lowering
the Quality and quantity of the food served. They clearly
understand that a labor cost of 50 cents means that only*25
cents can snfoly be spent on food. Than, the restaurant men
feel: hemmed-in by the labor costs, prions and the profit
squeeze.

The eearoH for efficiency in the service induatrioa in-
evitably centers upon securing intelligent, highly motivated
and skillful personnel. In order to retain such peeplo in the
industry. they must be 3311 paid and be well supervised by
peeple who are dedicated to good management. Further, as
their personal efficiency rises on the Job, they expect thot
their monetary reward must be increased. It would appear
therefore that the industry dare not fall too far behind in
providing a living wage without serious consequences of a van-
ishing skilled labor market and lower employee productivity. A
further.oxtenaion of the labor cost problem is reflected in
Table 22. Employees in :11 industries new measure their wagon
in total take home pay and fringe benefits. A: can be seen
from the table, meals on the 10b and uniforme are the two most
comer: fringe benefit: offered by the restaurants when experi-
ences are shown in thin study. Beyond this nine out of ten
(87.9 per cent) offer paid vacations, (75.8%) offer hospitnli-

sation plans, nearly three-fourths (72.4 per cont) launder

46

TABLE 22

1733213333 BT‘LEE’E‘ii-“ITS OFFERED BY
SAILPLE GROUP

" -— 1n-
” _... —————:_“—~

Benefits Per cent of Sample

 

Meals ”on the JOb‘ 100.0
Uniforms 100.0
Paid Vacations 87.9
Hospitalization Plans 75.8
Uniform Laundry 72.4
Psid Holidays 67.2
Group Insurance 6i.6
Sick Leave V 48.2
Pension Plan 29.3
Others 17.8

uniforms for their employees, two-third (67.2 per cent) offer
paid holidays and (64.6%) offer group insurance. Sick leave

is granted in about s.hslf (48.2 per cent) of the establish-
ments and 29.3 per cent offer pension plans. Among the other
benefits offered by 1 small percentage of the sample (17.2 per
cent) were such things as small loans, profit sharing, disabil-
ity insurance, Christmas bonuses. birthday gifts, service pins
and watches, birthday pay, discount on foods, small loans and
annuity payments upon retirement.

The total fringe benefits offered in these successful

restaurants, in the main, compare with the fringe benefits

47
offered in the retail field. The all industry everege of
fringe benefits in 1961 wee 24.9 per cent of payroll.1

It in dittiaxlt to place e rigid dollar value on eev~
eral of the benefits. But it can be safely eeeumed that the
total value of the benefits offered cost the restaurateur
several hundred dollars per employee. At a very minimum,
meals alone add $250.00 to $500.00 a year to the employoOI'
real wages. Vaoetione coat the employer from $100.00 to
$250.00 a year per emoloyee. Hospitalization, group life in-
surance. oaid.holidaye and uniforms also probably ooot ebout
$800.00 a year per employoe. Thus, it can be seen that fringe
benefits add from $500.00 to $1,500.00 e year to the employee'-
real wage and take from 6 per cent to 15 per cent or the salon
dollar. ‘

The trend over the past several yoare hoe been to in-
crease the basic dollar wages as well as the fringe benefits.9
or the two, the coat of fringe benefits is now rising more
rapidly than the coat or the banio dollar wage. There are for
employees in the restaurant business today who receive lea:
than $50.00 e week. Skilled personnel, supervisors and manna
gore receive from $75.00 to $250.00 per week. These people
have a real wage of from $100.00 to $300.00 per week. Those
below the level of $75.00 per week are unskilled or tip

 

,—

1Chamber of Commerce of the United States, Fringe
Benegite (Washington, D. 0., 1961). p. o.

2Netional Restaurant Aeeooiation, Washiggton Regogg
(washington, D. 0., September 17, 1962), p. .

48
employees.1 It is difficult to estimate on s rsctusl bssis
the number or employees in this industry who fill in the 1st-
ter two classes. This highly diversified industry hse never
been fully snslysed from the point of rise ss to the nuflber
of employees in each classification. Hesever. it is resson-
able to assume thst 60 per sent or the employees in the indul-
try ere service (tip) employees or unskilled. st1s 23 offers
en interesting estimate by the reporters for this study 0! the
value of tips and gratuities received by their employees in rs~
letion to their esrned income. is reported‘by those successful

TABLE 23

ESTHEAT’ED TIPS 8t GRATUITIES»
REMTIOIJSBIP T0 EARNED 11300243

  
       
 

up -w‘w-on—un «.mmi a—e --A-———..Mp

   

u —.-.. vwmvn - o. .. ..—-. - - l... -— v..— -N-“ cum...“ o..- amen—n m—na—Wu'mq - m . _ .‘Nfivuml hem “ uw~n

 

Eonsg 10% 25% 50% OES;
Menagement Personnel 100.0 0 0 0 0
Supervisory Peroonns1 100.0 0 O O 0
Preparation Personnel 100.0 0 0 0 0
Hostesess 63.8 20.7 15.5 0 0
Hesdweiters . 34.6 20.? 25.8 8.6 10.3
Waiters & Waitresses 17.3 25.8 29.8 17.3 10.3
Bus Boys 60.5 17.3 8.6 13.0 0
Others 100.0 0 0 0 0

M -—-——‘

1Restaurant employees who receive a part of their income
from the general public in terms or gratuities.

 

49
Operators, none or their managers. supervisors and skilled
preparation personnel receive additional income from tips.
Six out of ten (63.8 per cent) of the reporters estimated
that their hostesses received no tips: 20.7 per cent or the
sample of the group estimated that their hostesses receive
10 per cent additional income from tips: 15 per cent of the
sample group estimated that their hostesses received 25 per
cent above their income in gratuities. It might be expected
that the estimates by management of the amounts received by
waiters and waitresses in tips would run considersbly higher
than the sample indicates. Only s small percentage of the
total ssmple estimated that their waiters and waitresses re-
ceived more then so per cent or their total income in gretuiu
ties. It is emphasised that the estimates set forth in Title
23 are at best rough guesses. They ere not hssed on studies
nor on concise estimates. In any event, the table clearly
points out that the real income of three classes or employees
in the industry is not visible and is not measurable, end
that the take home pay or most classes of employees in the
industry compares favorably with others of s similar level of
skill in the service and retail fields.

A final question of considerable interest asked in the
questionnaire was the reasons shy sage and salary incresses
have'becn granted during the last ten years.

Table 24 recapitulates what the employers gave es their
reasons for increasing the basic pay of their employees. Tee

primary reasons induced employers to raise wages. First, to

TABLE 24

WRGE IKCREASES GRARTED DURING
LAST 10 YEARS

A __
__.‘ L- - ‘ _._.‘
w W w—fi V ' w .

 

Reasons Given 5 of Sample

To motivate workers to do a better Job 24.?

To obtain better ”quality” employees 24.3

Booting oompetition from outside or field 20.1

Meeting competition from.reetaurent field 15.0

To meet demande of union 9.?

Required by'union contract escalator oleueee 6.8
Total ' 100.0%

motivate their employees to do e better job and second, to ob-
tain better employees. An important third reoeon given one
”meeting the competition from outside the restaurant field as
well as the competition within the induetry.‘ Apparently union
demands and escalator clauses in union contracts were for leee
immortant than competition in moving employers to grant rage
inoreasee.

It can be oonoluded from.Table 24 that air out of ten
of the employers inevitably effected their overall wage cooler.
They reported that competition from outside and within the .
field for better quality employees one an irreaiatable force
pushing their salary and wage schedule: upward. One out of

tour reported that they had used monetary rewarde in order to

51
motivate their workers. One out or seven of the employer. re-
ported that union demands had made the difference in their
wage and salary cost. In brief, the coupetition for employee!
and the attempt to motivate employees are the two most comp
polling forces which have caused management to share more of
the sales dollars with their workers.

Since the competition for employees will not decrease
and the nonber of available eatisraotory employee: will not
increase, there is little likelihood in the future that labor
costs will decline. Human efficiency obtained through better
supervision and better management is now and will be en eb-
eolutely essential ingredient in continuing success in the
restaurant busineee. There is a tremendous reward available
to any orgmnieetion which can help the restaurant industry
solve its personnel, labor and labor costs problems. There ie
an ever present need for better understanding by management of
the forces eith which it is dealing. machines and new devices
require capital additions. The investment per dollar sale end
the investment per hour of labor used must both inoreeee. The
continuing pattern found throughout this study is that manage.
ment has placed its finger equarely on the heart of the problem
when they state that employees of satisfactory caliber is the

first personnel problem of the reetaurant industry.

CHAPTER VI
SUKEARY RED COHCEUSIONS

The five primary Objectives of this study. as pre-
viously stated were:

1. To identify the major personnel problems of the
industry. .

2. To examine the turnover problem among restaurant
employees.

3. To study the training offered in restaurants.

4. To compute information on wages and salaries.

5. To examine labor costs in the industry.

is viewed by management, the three nsjor pereonnel prob-
lems are e,shortage or employees of satisfactory caliber, leak
of motivation of employees, and the devolOpment or supervisory
personnel. To further identify the prdblom of supervision, it
was pointed out that supervisor's weaknesses included their
inability to motivate employees, their inability to organise
the work of employees and their inability to plan work. Per—
oonnol shortages are most critical among skilled food prepnree
tion workers and supervisors of all classes. Shortages or oil
types of qualified personnel are qualitative so that there is
a never ending search for employees.

The employee turnover rate is a very serious problem to
the industry and a very costly one. Six out of ten employee-

aro replaced each year. Thirty-eight per cent of those taking

(:1
{‘0

53
Jobs in tho restaurant industry oooh your roplooo workorl who

loavo and 27 par oont replace workers who are discharged.

Even Iith 40 per cent or the industry‘o ooployooa remaining

on tho job no long tonm.omployooo, tho efficiency of o roo-
taurnnt is oftootod oorioualy‘by constant ohongo of the Injorm
ity of personnel.

Almost 90 per cent of tho respondents stated that they
oonsidorod training to‘bo very valuable or fairly valuable.
Eon-var, tho roatauratour’a convictions of training wore not
put into action. Only 34 per cont had complete training pro-
grams in their organization. This condition, undoubtedly, is
the reason‘why oxporionoo in so much sought after in hiring
an employee.

Wogo rates have adVanood during the past ton your. in
the industry primarily to motivato vorkorl to do a bottor
10b and to obtain better quality employees. Hooting compotio
tion from outside and inside the industry was also signitioont.
Anofihor important factor in the percentage of tringo benefit:
which have to be added to real wages. Fringe benefits nor.
reportod to‘bo 6 to 15 per cent of solos. The minimum figuro
added to tho average labor cost of 53.7 per cont, brings tho
actual cost or lobar to 40 per cont of tho solos dollar. Lobe!
cost has been increasing at the rate of 5 per cont per your and
there in not an apparent lot-up in tho near future. Many’rooa
tauranto will be forced to increase tho employoo'o productivity
and, perhaps, operate with tower employees.

There in no answer which can be offerod an a euro-all

54
for the enduring long range and daily problems which.exist

in the restaurant industry. Each individual management must
determine the cures for its own Operation, since the differ-
ences between restaurants make policies and methods variable.

Mhnsgement must assume the responsibility of creating
a highly efficient‘business. In most instances this cannot
be achieved by holding to old traditions of operation in these
days of increasing costs and decreasing profits. flow, more
than ever. the individual's skill in management is his great~
est asset. These skills and abilities can be acquired, for
they can be taught. The individual can he taught to be mmre
flexible, to be more understanding, to he more skillful in the
use of management tools.

thsgers must recognise that they are limited in their
efficiency'by their lack of knowledge of the science of‘msnage-
ment. There is a vest difference between the skills used in
the restaurant business and management in the restaurant busi-
ness. thcgemont training is not training in how to perform
the tasks of the business; it is training in directing, con-
trolling and coordinating in a more intelligent and purposeful
‘eay. those who perform these tasks.

Top management must recognise the necessity for acquaint-
ance with the dimension called 'nenagement.‘ It is not enough
simply to know the problems. or to understand and be worried.hy
the symptoms of the problems. The important factor is action
by management to pursue management training.

The one resource in the restaurant industry which‘hss

55
not been effectively develoned is personnel. The develOpmsnt
needs to start with tap management. Frou.this point, the
greetest effort should be exerted in the development end
training of supervisors Who can help shore the management
burden. Only when these phases are accomplished can preper
attention he focused on the workers and concentration‘be pine
pointed to training the employee for maximum productivity

and efficiency in the restaurant.

51131.1 OCEEAPHY

Book.

Appley, Lawrence A. Management in Action. Rev York: Ameri-
can Mhnsgement Association,. 956.

Beokman, R. 0. egg! to Train Suoervis n. 3rd. ed. rev.
New York: Harper 8: Brothers. ggi .

Brown, Ellen. Effective supervision. Hee‘York: Haonillsn
00., 1956.

M~ . Conference Leadgf's Guide to Effective Super,
visig}. 1H0! York: Mac n 0.. 9r- e

Drucker, Peter F. .Ihe Prestige 0; Egnagement. Hee‘York:
Harper & Brothers. 1954.

Dukes, Peter and Landberg, Donald. Hoe to Ogfigate e Restaur-
ant. Bee York: Ahrens Puhl. 60.. 96 .

 

 

 

 

Elliott, Travis. sole hat eith_Restaurant_Oporctqg{.
d vols. Austin, Texas: lexas Restaurant issoeiat on,
1955.

Finley, Filliem‘w. Ssrtsin. s. Q.. and Tate, Willie h.

Human Behav.og in Indugtgz. Ree York: McGrsv-Hill
00 0e. 1 55e

Kotschevar. L. H. and Terrell, Hhrgaret E. Food Service
{lagging. Ree York: Jehn Wiley & Sons, $961.

Lmd‘berg, Donald. 1 *
., m. Dabuque. ‘ 0..

Harting, Elisabeth. Aha Engzglopegis of Supervisor! Tr i i .
Hee‘York: Amer can dansgemen Association. 1561.
scott, Welter D... Clothier, Robert O. and Spriegel, Wm. R.

Personnel Hanggongnt. Bee York: “borer-Hill Book Coo.
954.

Spriegel Wm. 8.. Schuls Edward and Spriegel, hm. 8. 81533351
2; Supervision. fist York: Jenn wiley & Sons, 1 5 .

 

  

 

 

Dnbuqne,

 

Eabl ic Document!

U. 8. Department of Commerce.
Restaurant. 1957.

 

U. 3. Department or health. Education. and Welfare. Pogg
Service Industry Training_Progrens and Facilities.
1961.

Chamber of Commerce of the United States. Fringe Benefits.
fiashington, D. 0., 1961.

U. 3. Department of Labor. Fanposerskahallenae g; the
EQGOHe 1950e r

U. 3. Bureau of Labor Statistics. 0%cuEationa1 Outlookgfiggg-
BOOEe B’Jll'fitin x0. 1300-86, ‘0 o l

U. 3. Bureau of Labor Statistics. Englgxgent Outlook in
Restaurant Occupatiqgg. 196 .

graining Prggragg

fictional Restaurant Association
American hotel Institute

Cornell University ’

Culinary Institute of America
Ohio State Restaurant Association
Texas Restaurant Association
Indiana Restaurant Association
Eissouri Restaurant Association

1 as a P r o i

Greenasay, Donald. Developing_$trongflfood Stargg. Chicago.
National Restaurant Association. 1962. '

_M . What's.¢oming in the Futur ? Chicago.
Rational‘fiostaurant lssooiation. * .

National Restaurant Association. hhrketing Report. Washington,
D. C... April 27. 1961' my 6. 61.

National Restaurant Association. Washington Repeat. Washington,
D. 0.. September 11, 1961.'§optomber . 02.

 

 
 

Radigan, J. Terry. Th Rests‘rsn Induet". Washington,
D. 0., Nations estaurant Assoo.at on. 1961.

Reoorts

Greenaway, Donald and Blskor, Gertrude. A 3 ad of th
forehandising figperience in Five C asses of ngosssfu;
Restaurants. finite Flaina, H. Y. ‘36nora1 Foods Corp.

1958.

maxinsey'& Company. A Research Stndz to Improve the quoig

of Cooks ard Eakora gar th?_penofit of the Soto; Ig-
dustrz. Eoffslo, B. . no Ststler Foundation.
1355.

 

 

 

 

JLPPEHNDIXI

SURVEY ON PERSONNEL PRACTICES AND PROBLEMS IN THE RESTAURANT FIELD

This survey grew out of an earlier survey in which your organization may have
participated in the Fall of 1956, which touched on a number of different
problems and practices in the restaurant field. In the results of that
study, several questions were raised with regard to personnel matters: this
survey is intended to find out more about what restaurants do in these areas
of employee relations.

This is a confidential survey; the aim is to come up with an over-all descrip-
tion of personnel practices in successful restaurants, not to identify indi-
viduals or particular establishments or firms. Organizations of all types
and sizes are being asked to participate.

By filling out the questionnaire carefully and completely, you can contribute
greatly to the knowledge of how the restaurant industry handles its personnel
problems. Mbst of the questions can be answered simply by a check mark or a
number in the appropriate space -- others give you an opportunity to express
more fully your opinion on various kinds of restaurant personnel matters.

You will receive a copy of the report as soon as it is available.

Thanks for your help.

* * *-

1. In the 1956 survey, many restaurants indicated that they had.problemc
with some of the following personnel matters. Please check the three on
the list which you feel are among the biggest problems of the restaurant
industry today.

( ) Getting employees of satisfactory caliber

( ) Labor turnover among service personnel (Dining room or counter
workers, except supervisors)

( ) Labor turnover among preparation personnel (Kitchen workers, except
supervisors)

Selection of supervisory personnel
Development of supervisory personnel

Training of non-management personnel

( )

( )

( )

( ) Union relations

( ) Employee grievances
( ) Motivating employees to do their best
( ) Keeping employees informed about the business

( ) Other (Please specify: )
Bfi)

 

IN

2.

60

THE 1956 SURVEY A NUMBER OF R"STAURANTS INDICATED THEY HAVE HAD PROBLEMS
IN GETTING QUALIFIED PERSONNEL. THE NEXT FEW QUESTIONS ARE ON THIS SUBJECT
RECRUITING.

How many full-time and part-time people do you employ in your organiza-
tion, including management, supervisors, and workers? (If there are large
differences between your lowest level and your peak, please write both
numbers in.)

a.

Number of full-time employees

 

Number of part-time employees

 

Please indicate the average length of time your present employees
have been with your organization. (Please write in the number.)

Years

 

How many new employees has your organization hired in the past year
to replace others who left, voluntarily as well as involuntarily.

 

(Please approximate the number.)

 

Please write here any comments you may have on these questions:

 

 

 

Are your non-management employees represented by a union? (Please
check one answer.)

( ) No

( ; Yes, all of them

( Yes, some of them (About what percentage? %)
( ) Other answer (Please specify:

 

 

 

If yes, are your hiring practices spelled out by your union con-
tract(s)?

( ) Yes
()NO

Comment

 

 

5.

Who makes the final selection of employees to be hired in your organiza-

tion?

AAA“

(

)

(Please check every answer that applies.)

Proprietor or chief executive

Personnel director or interviewer

Individual supervisors, for their own work groups
Other answer (Please specify:

 

 

Don't know

In your experience over the last ten or so years, what have been the two
most usual reasons for needing to hire new workers in your organization?
(Please check two answers.)

(

)

Increased business because of expanded facilities
Increased business without expanded facilities

To replace workers who leave

Seasonal increase in business

Other reason (Please specify:

 

 

Other reason (Please specify:

 

 

Considering the restaurant industry as a whole, in your opinion what

kinds of qualified.personnel are in the shortest supply today? (Please
check three kIfids .)

(
(

)
)

Supervisors
Service workers (Dining Room or counter workers)

Skilled food.preparation workers (Chefs, cooks, bakers, salad
makers)

Unskilled food.preparation workers
Sanitation workers (Dishwashers, porters, etc.)

Office workers (Including cashiers, secretaries, bookkeepers)

Please check here if you have no trouble getting qualified workers
of any kind today .

Please check here if you don't know or can't answer

62

S. Over the last ten years or so, how much of the time would you say there
has been a shortage of qualified workers of each of the following kinds?
(Notice the answers run across the page. Please check one answer for
each category.)

Shortage Shortage Seldom or
most of up to half. never any
the time of the time shortage

 

Supervisors
Service workers

Skilled food preparation workers

Sanitation workers

( ) ( ) ( )
( ) ( ) ( )
( ) ( ) ( )
Unskilled food preparation workers ( ) ( ) ( )
( ) ( ) ( )
Office workers ( ) ( ) ( )

Comment

 

 

 

THE NEXT FEW QUESTIONS ARE CONCERNED WITH THE QUALIFICATIONS AND TRAINING OF
RESTAURANT EMPLOYEES.

9. In your organization, which practice do you follow in hiring people for
the following kinds of positions? WOuld you hire completely untrained
people and.plan to train them? Trained.people only? Or both? (Please
check an answer for each kind of position.)

We would hire:
FulIy Trained Both Untrained onIy‘Untrainéd.And

 

 

 

Type of Position Only And Trained Train Ourselves
Supervisors ( ) ( ) ( )
Service workers ( ) ( ) ( )
Skilled food preparation

workers ( ) ( ) ( )
Unskilled food.prepara-

tion workers ( ) ( ) ( )
Sanitation workers ( ) ( ) ( )

Office workers ( ) ( ) ( )

IO.

11.

12.

63

If you were judging the most important needs for improvement of the
supervisors in your organization, how would you rank the following?
(Please put a number I in front of the biggest need, a number 2 in front
of the next biggest, and so on.)

 

Ability to plan

 

Ability to organize

 

Success in carrying out policies

 

Ability to motivate employees

 

Knowledge of the over-all Job

 

Some restaurant organizations have formal classroom or other off-the—job
training programs for some or all of their personnel. Does your organi-
zation have anything like this? (Please check one answer.)

( ) Yes, we have a formal program......(Please go on to question 12.)
( ) We have on-the-Job training only...(Please skip to question 15.)
( ) We orient our new workers, but

have no training beyond that....(Please skip to question 15.)
( ) No, we do no training..............(Please skip to question 15.)
Please list the kinds of Jobs for which your organization has a formal
training program, and next to each one, write in about how many hours an
employee would spend in it, from.beginning to end.

Kind Of Job Total Hours Spent

 

(example: Hostess)

 

 

 

 

 

 

 

 

 

 

 

13.

lb.

64

In your training prob ram, do you use any help from outside your organiza-
tion?

( ) YES, continuously
( ) Yes, occasionally
( ) No, not at all

If yes, please describe what kind of outside help you've used (such as
trade schools, universities, trade associations, consultants, books, mag-
azines, etc.). Please make your comments as specific as you can.

 

 

 

 

How valuable -- how useful or effective -- has your formal training pro-
gram(s) been?

( ) Very valuable

( ) Fairly valuable

( ) Of limited value

( ) Not at all valuable
( ) Can't say

Please add any comments you'd care to make about your training program,
for instance, whether specific ways of gauging the success of the program
have been set up:

 

 

 

 

 

THE NEXT FEW QUESTIONS ARE ON PAY} FRINGE BENEFITS, AND TIPPING

15.

YOur organization has undoubtedly raised wages in the past ten years.
For which of the following reasons were raises given? (Please check
every answer that applies.)

In order to meet competition for workers from other restaurants
In order to meet competition for workers from other TIEIds

To meet union demands

Union contract "escalator" clauses
Desire to get better quality workers
In order to motivate workers to do a better job
Other reason (Please specify:'

 

 

AAAAAAA
VVVVVVV

 

 

( ) Other reason (Please specify:

 

6&5

Which of the following fringe benefits does your organization provide to
some or all of your employees? (Please check one answer for each bene-
fit.)

 

 

 

 

 

Provide Provided Through
Ourselves The Union(s) Not Provided
Group insurance ( ) ( ) ( )
Hospitalization plan ( ) ( ) ( )
Pension plan ( ) ( ) ( )
Paid vacations ( ) ( ) ( )
Paid holidays ( ) ( ) ( )
Sick leave ( ) ( .) ( )
Meals ( ) ( ) ( )
Uniforms ( ) ( ) ( )
Uniform laundry ( ) ( ) ( )
Other benefits:
(Please specify)
( ) ( ) ( )
( ) ( ) ( )
( ) ( ) ( )
( ) ( ) ( )

 

( ) Please check here if patrons are requested not to

tip, and skip to question 18.

 

Approximately what percentage of their income do you think your employees
make in tips? (Please try to estimate, even if it is only your "best
guess.")

Less Between Between

 

 

 

No Than 10% & 25% & Over Don't

Tips 1% 25% 50% 50% Know
waiters or waitresses ( ) ( ) ( ) ( ) ( ) ( )
Headwaiters ( ) ) ( ) ( ) ( ) ( )
Hostesses ( ) ( ) ( ) ( ), é ) )
Busboys E ) ( ) ( ) ( ) ) )
Preparation Personnel ) ( ) ( ) ( ) ( ) )
Supervisory Personnel ( ) E ) ( ) ( ) ( ) ( )
management Personnel ( ) ) ( ) ( ) ( ) ( )

Considering your total sales of all kinds, how'many cents of your sales
dollar goes to pay labor costs, including fringe benefits? (Please write
in the number.)

cents of each sales dollar

 

66

TEE FINAL QUESTIONS DEAL WITH COMMUNICATIONS BETWEEN KANAGEHENT AND EMPLOYEES

 

19. What practices, if any, do you now use or plan to use to keep your
employees informed about the business? (Please check an answer for
each.)

 

NOW PLAN Neither Use
Use To Use Nor Plan To

 

 

Personal Contact
Bulletin Boards
Employee Magazine or
House Organ
Employee Meetings
Suggestion System
Other: (Please state)

VVV VV
VVV V V
AAA AA

() () ()
() () ()

20. Which of the following policies, if any, do you use to find out how your
employees feel about their Jobs, supervisors, wages and fringe benefits,
and so on? (Please check each practice you use.)

 

 

Personnel director or other management person "available" for
employees to talk to

Suggestion or complaint system

Employee meetings

Regular scheduled talks of employee with his supervisor
Employee talks with his supervisor whenever employee wants to
Attitude surveys

Other practice (Please state:

AAAAAA A

 

 

( ) We have no policies on this score

SO THAT WE CAN MAKE THE MOST MEANINGFUL ANALYSIS OF THIS DATA (YOUR ANSWERS,

OF COURSE, ARE COMPLETELY ANONYMOUS) WE WOULD APPRECIATE THE FOLLOWING INFOR-
NATION:

A. ABOUT YOUR BUSINESS

(1) What is your present seating capacity? (Please fill in the numbers.)

seats, at addresses

 

67

(2) Please check eacn of the following types of restaurant business that
your organization Operates.

Cafeteria

Independent table service restaurant
Multi-unit table service restaurants
Specialty'menu

Drive-in or fast food service
Industrial or executive feeding
Other type (Please specify:

 

 

(3) How many years has your organization been in business? (Please
check one answer.)

Five years or less

Six to ten years

Eleven to twenty years

Over twenty years (Please specify the number: )

 

Other answer (Please specify:

 

 

 

 

)
B. ABOUT YOURSELF AND YOUR BACKGROUND:
(1) This questionnaire was filled in:
( ) By a man
( ) By’a woman
(2) Whose present Job is primarily:
( ) Proprietor
( ) Manager
( ) Personnel Director
( ) Other executive or management Job (Please specify:
)
( ) Other (Please specify: )

 

(3) How many years of experience have you had at each of the following
levels in the restaurant fieli? (Please write the number in each
space provided -- O, l, 2, 3, etc.)

Number of years at worker level

Number of years at supervisory levels

 

Number of years at executive or management levels

 

NUmber of years as prOprietor

 

683

(h) Have you had business experience in fields other than the restaurant
field?

( ) No

( ) Yes (If yes, please list the total number of years and the

kinds of work you were in:)

 

(Number of years in other fields)
(Other kinds of work:

 

 

 

 

 

“7'1? NN ANN