Harvest America CUES BLOG

There are numerous ways to look at the debate over raising the minimum wage in the United States. First, there is no question that low-end wages have not kept up with the cost of living and that, of course, is an issue that needs serious consideration, however it appears that the primary target has been the restaurant industry. Restaurants are likely one of the most significant sources of minimum wage jobs, thus it is understandable that it would be the focus of this on-going debate.

I do not profess to have the answer to this issue that would satisfy the needs of all sides of the argument, however, I think that it is important to look at the situation from every angle. Unemotional assessment oftentimes leads to the best resolutions.

The positions in the restaurant industry that are the subject of concern are typically classified as either “entry level” or “gratuity based” positions. I refrain from using the term “unskilled” because that is far from the truth. All positions in a service industry have a level of skill associated with successful execution of tasks. To this end it is important to define “entry-level”. By definition, this would infer that there is a track for growth and that the initial position is temporary if the individual is willing and able to take advantage of the opportunities availed. This, to me, is the real issue.

When an industry provides “entry-level” positions does it have a responsibility to provide opportunities for growth? Does this mean that this same industry has a responsibility to assist “entry-level” employees reach those opportunities through effective training and assessment? I believe that the answer is yes and also believe that few industries are as well positioned as restaurants to do so.

Unfortunately, formal training programs are few and far between. The intent is there since most restaurants would agree that promoting from within is preferred to constantly searching for candidates to jumpstart their careers by entering an established business culture without a true understanding of the dynamics of its team. Intent is rarely supported by the funds or the investment of time in the process of training people for growth.

Minimum wage is designed to give people a chance. In restaurant operations there are numerous examples of dishwashers who became breakfast cooks and eventually went on to become chefs or managers. If you were to poll a sampling of successful professionals in the prime of their careers I would dare say that a large percentage likely began with a minimum wage position in restaurants. This was their foray into the world of work and the experience provided them with an opportunity to grow.

Entry-level positions are not designed to be a long-term career for anyone. To view them as the sole means of providing a livable wage is not realistic. When education and training are not in place to provide opportunities for growth then entry-level, minimum wage jobs appear to be a problem that needs to be fixed.

The restaurant industry is labor intensive. The provision of a service that is driven by customer spontaneity, requiring the creation and service of products to order will always be difficult to automate and systematize. The profit margins are very slim, limiting the funds available to support a large labor force. You can do the math.

In the front-of-the-house another related issue is a concern. Gratuity based employees can, by law, be paid a sub-minimum wage with the intent that customer gratuities will bring their average wage at least up to Federal minimum. In most cases, this is the reality and service staff will typically make substantially more than minimum as a result. There are a handful of restaurants considering the elimination of gratuities and simply paying servers a much better wage. On the surface this sounds reasonable, however elimination of gratuities will simply mean that the selling prices of menu items will need to increase substantially to support the higher wages associated with service impacting the incentive for an entrepreneurial approach.

Service staff members in a restaurant are private entrepreneurs who have been given an opportunity to set up shop in a restaurant dining room. They must adhere to the standards of the operation, however the more adept they are at meeting and exceeding guest expectations, the more they know about the product that they sell, the more they are able to control the outcome of the guest experience, the better their private business will perform. It is similar to having your own business without any upfront investment of capital. They are in control of their success and earning power.

With the right training in place and a commitment from the restaurant to invest in training, dishwashers can become better paid cooks and maybe even kitchen managers and chefs and servers can become the next wave of restaurant supervisors and managers. It is this investment in people that will take the focus off of minimum wage and benefit the business at the same time.

A positive approach would be for the restaurant industry, as a whole, to reinvigorate the age-old apprenticeship model that has been the hallmark of hospitality throughout Europe and one that continues to flourish with some of the trade careers in the United States. Individuals would begin their career as an entry-level Apprentice while they learn the basics of a trade, move on to Journeyman status after successful assessment of their acquired skills and eventually on to a Master once they have completed the program. At each stage the wages they receive would increase, as would their overall value to the company. The investment of time and funds would be apparent on the part of the employer and the commitment of time would be required of the employee (typically a three year contract to work for the company).

Not everyone is inclined or can afford to pursue a college education so this model would provide an alternative with comparable results. The investment on the part of the employer would help to address the issues of employee attrition and the short-term concern over “entry-level” wages. Apprenticeship can be a win-win and possibly a more effective alternative to simply raising minimum wage.

Let’s push for investment in training and a restructuring of our education system to provide improved skilled career opportunities for young people.

PLAN BETTER –TRAIN HARDER