Since 2011 employment in foodservice & drinking places (FS&D) has grown faster than in the economy in general, but there has been a relative deceleration in the last year — a trend that shows up clearly in the June 2018 U.S. jobs report.
In 2016, the industry was creating jobs 1.9x as fast as the economy (3.4% average for FS&D versus 1.8% for the non-farm private sector), this dropped to 1.6x in 2017, and it’s at 1.3x year to date (FS&D growing 30% faster than non-farm private sector). The last time the FS&D sector decelerated to a lower job creation rate than the rest of the economy was in 2010.
Below, we take a further look at where employment and wages stand as of June 2018, along with how they’ll shape the industry and impact restaurant companies, investors, and operators in the months ahead.
JUNE 2018 US RESTAURANT LABOR DATA: EMPLOYMENT
Some 213,000 jobs were created in the U.S. in June, marking seven years and nine months of uninterrupted growth. Average monthly job creation is 214,500 year to date, 18% higher than 2017.
These numbers are largely influenced by the positive figures in the restaurant industry: foodservice & drinking places saw an increase of 16,400 employed persons, 24% lower than the previous month. Year to date, however, there’s a deceleration of 31%.
As of June, the leisure & hospitality sector (including arts, entertainment & recreation in combination with accommodation & food services) employed 16.3m people in the country, making it the third largest non-government employer, behind education & health services (23.6m jobs) and professional & business services (21.0m positions).
Leisure & hospitality ranked fourth in job creation in June. A full 25,000 jobs were created in the industry, behind the job creation figures for education & health services, professional & business services, and manufacturing. Year to date, the leisure & hospitality industry has created 8% of the new jobs, amounting to 102,000 positions.
JUNE 2018 US RESTAURANT LABOR DATA: WAGES
Meanwhile, wage growth continues to be moderate, though it surged in the leisure & hospitality sector.
Average hourly earnings for the private sector increased 2.7% (compared to last June), reaching $26.98. Hourly wages in the leisure & hospitality sector increased faster than the average, growing 3.4% in June year over year. Overall, wages in leisure & hospitality are close to 40% lower than the overall average in the private sector.
ABOUT AARON ALLEN & ASSOCIATES:
Aaron Allen & Associates is a leading global restaurant industry consultancy specializing in growth strategy, marketing, branding, and commercial due diligence for emerging restaurant chains and prestigious private equity firms. We have helped helped restaurant companies around the world drive revenues, increase profits, and enhance the guest experience through improved marketing, messaging, and menu engineering. Collectively, our clients post more than $100 billion in annual sales, span all six inhabited continents and 100+ countries, with locations totaling tens of thousands.