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October 19, 2022 - 11:56pm

Opinion: The debate over a restaurant closing

posted by Howard B. Owens in Opinion.

The social media debate on our story about Sweet Betty's closing has been, um, interesting.

Opinions have been wide-ranging, from "people don't want to work" to "restaurant owners don't pay enough."  

A sampling and my thoughts:

"Yet you have the government saying that unemployment is at all-time low but retail or restaurant has lack of employees."

Well, if unemployment is low, that means there are fewer people looking for work.  That means it is harder for existing businesses to fill open positions.  More people working leads to a "lack of employees" looking for work. 

That was a small business they should have been able to run themselves, with little help. I know, because I did the same exact thing. They either weren't willing to do what it takes to be successful or they weren't willing to pay someone what they were worth. Simple as that.

Clearly, a comment by somebody who has never owned a food service business.  Running such a business means multiple jobs overlap -- taking orders, cooking food, washing dishes, cashing out customers, and then somebody has got to keep the books.  It's not a one- or two-person business.

They are getting money to stay home and not work!!! Stop the free hand outs... And watch how many people look for work...

Extended unemployment benefits ended a long, long time ago and the economic evidence is the payments had little impact, when still active, on people's willingness to work.  There are currently 900 people drawing unemployment in Genesee County, according to the most recent Labor Department data.  That is not a number that screams "People are mooching off unemployment insurance payments."  

3% unemployment rate yet why are there almost a million on welfare! Time for workfare for the lazy!

Actually, in the U.S. there are nearly 60 million people drawing some sort of assistance, and nearly all of them who are of working age and not on full disability have jobs.

Then there are the people who blamed the owners:

Love how they say it's the workers why not blame the owners for not paying more for the work or putting on the work outfit and working themselves. Simple supply = demand and people have a life simple you wanna pay minimum wage you get minimum result

crazy how they’re closing and many other family-owned restaurants aren’t…time to stop blaming staff and look to themselves as to where the problem lie, whether it be their management or their product.

And some readers did jump to their defense, such as Susan Macomber:

The owners,family and friends worked there 99% of the time...They were very hard working and very friendly, and the food was delicious...The owners also closed for holidays and closed at times to give their workers some time off because they couldn’t get enough help. And they paid their workers well.

More blaming the owners from somebody who almost certainly never owned a business:

Unemployment is lowest it's been in 40 years... only the failed businesses are having trouble finding employees. The strong survive my friends, it's survival of the fittest, and you ain't fit.

Look around you, there are help-wanted signs everywhere.  There was a time, more than a decade ago, when economists considered an unemployment rate of five percent to be "full employment."  The idea is that at five percent, being unemployed was transitory.  People moved quickly from one job to the next.  It was temporary and the normal economic shuffling of the deck as businesses changed strategy, closed for various reasons, or people quit jobs just to have the time to find a better job. 

Also, COVID itself has taken a lot of people out of the workforce.  More than one million people in the U.S. have died, and nearly half of them had not yet reached full retirement age, and presumably, a lot of them were or could be in the workforce.

This is a very, very tight job market, probably the tightest any of us have seen in our lifetimes.

So let's talk about the free market:

This makes me so sad. I love Sweet Betty’s!!! But I get it. No one wants to work anymore, or if they do, it’s completely on their terms and hours. Businesses everywhere are impacted by this.

Here's the thing  -- in a free market, people can choose where they want to work.  They want to work on their terms.  I want to work on my terms.  You want to work on your terms.  We all want that opportunity.  I own my own business so I can work on my own terms.  When I worked for other people, I worked hard and improved my skills and knowledge so I could advance and make more money.  That's working on my own terms.  When there isn't a tight labor market, employers have the leverage to say, "work on my terms or leave" (perhaps with more nuance than that).  In a tight labor market, the power imbalance shifts to the workers.  But that's how free markets work, should work, and we want them to work if we want a thriving economy and an improving standard of living for everybody.

One reader asks legitimate questions:

How much were you paying? How many hours did you guarantee? Was it a regular schedule, or did it vary from one week to the next? Were your cooks treated with respect ot treated like they were disposable? People work when they feel like they are valued. If that's not the case, they go elsewhere. There are LOTS of jobs out there. Make yours the one everyone brags about.

Those are all things that will impact the ability of a business to hire good and qualified people.  However, there is only so far a business can stretch on pay and hours and benefits.  Running a business is not as easy as this reader makes it sound,  as I'll address later.

Another take on the "people don't want to work" theme:

To all who wonder why they can’t get help….. PEOPLE DONT WANT TO WORK TODAY! THEY WANT TOP PAY FOR DOINB LITTLE! There are plenty of jobs all over…. It seems to me that if you REALLY want a job or NEED a job…. Then take one of the jobs!!! Money is money!

Let's just say there are in fact people who don't want to work.  There are undoubtedly some people who don't want to work. Period.  There is no wage that will entice them to leave their bedroom.  But this poster seems to assume that just because there are jobs, there are jobs that the people without jobs want to take those jobs.

There are a number of reasons that people not working won't take a job you think they should take: They're not qualified. It doesn't fit their career path.  The hours won't let them take care of their children or go to school.  The job won't help them advance their career and could even derail it.  Or maybe the job you think they should take isn't just offering enough of an incentive to give up fishing to go to work.  Money is, as the poster says, is money.  And yes, sometimes it takes more money to entice a person to take a job.  

In order for a worker and an employer to find each other, the worker needs to be qualified to work the job that's open.  Even if a worker who has spent the past few years pushing a broom is willing to take a job as a line cook, that doesn't mean he's qualified to be a line cook.  Employers don't like to hire unqualified people because they don't have the track record to ensure they can do the job or will stick with it.  Unqualified workers cost money and can be a disaster.

A more nuanced take that deserves a response:

Restaurants took the worse beating when that Covid crap shut N.Y. down. The ridiculous cost of living made it so minimum wage skyrocketed. Instead of putting caps on rent increases and utilities the more pay made prices go up MORE. Small business owners suffer because with their overhead and insurance payments they cannot afford to hire as much workers. Everyone suffers. And people complain about higher costs in restaurants. They HAVE to raise prices just to make ends meet.

Restaurants got a lot of financial help during and because of the pandemic restrictions.  All of that money being pumped into the economy is part of the cause of current inflationary pressures (it's basic economics: increase the money supply and prices generally go up).

Restaurants by and large stayed alive with delivery and curbside pickup while maintaining lower overhead with the dining rooms closed. When the economy kick-started again, companies were scrambling to fill open positions.  A lot of former workers found new jobs, retired, started their own businesses, went back to school, decided to become stay-at-home spouses, picked up a job with Uber, Door Dash, or Instacart, or otherwise left the workforce (and not just because they became lazy, but in the human condition, there is always some of that, too).  With a shortage of workers, restaurants and other businesses were forced to raise wages. That started before the current inflation cycle and is one of the multiple causes of today's inflation.  The sad thing is, the wage gains workers first realized after the end of the pandemic have been wiped out by inflation. 

Adrian Fitzgerald Harris has an informed view:

Low Birth rates, massive boomer retirements and no one solving the immigration problem have caused some of this.

The decline in the stock market might coax some people out of their early retirement. The low birth rate isn't going to change so long as we remain a first-world economy. So that leaves immigration.  Want more workers?  Let more workers into the country.  We need about one million working immigrants flowing into this country ASAP.  That would spur the kind of economic growth we need to stave off a recession and stem inflation.  The economy would boom.

Terry Paine left an intelligent comment:

You can tell the people that have never had a business with employees before. Maybe these business geniuses could offer some advice on what an employee's pay should look like since we know $14 to $17 is not enough. Then the employer can make a decision whether they can themselves take that big of pay cut or if raising the cost to the customer will reduce sales enough that the business has to close anyway. Tough balance.

I can say that their standards for hiring wait staff is pretty high since I have enjoyed every one I've ever had wait on me. That standard might be just as important of more important than the food.

So to sum up.  There are two main camps here: blame the employers and blame the employees.

How about if we not blame either?

Running a small business is hard, especially a food services business.  You have government regulations to worry about, employees stealing (a big problem in a mostly cash business), taxes, insurance, lots of overhead, employees who have their own lives and own issues that you need to balance, supply issues, competition to worry about, customers who complain, and so on.  You pretty much have to be insane to run your own business.  It's a hard life.  Thank God there are people who do it though, because small business owners are the true backbone of America and our communities.  They offer more charitable support to their communities, give communities a sense of cohesion and pride, and the owners are often more involved and more often make fine mentors for the young people they meet.  

And employees have their own wishes and desires. They have aspirations, dreams, ambitions.  They might have families to care for or passions they wish to pursue away from work.  They are often not business owners themselves because of these other constraints or priorities.  But humans evolved to acquire resources to make their lives more stable and better.  For the vast majority of us, we want more money and better things, so naturally, we want better pay.  And if we can't get better pay, then we look for other tradeoffs, such as more time to go fishing or play in a rock and roll band.  

In our rush to make everything political these days, we miss how complex our economy really is and how something as seemingly straightforward as a restaurant closing is really about a world of competing economic forces. Sweet Betty's closing is sad. It shouldn't be fodder for scoring political points.

Fred GUNDELL
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I would offer another perspective on Restaurant help, or lack of. First of all if you look around LeRoy there is an abundance of food service venues. Especially for the size of the village. There are only so many workers to go around. The same holds true right here in Batavia. It looks like every other building is some type of restaurant.(or Pizzeria) Now we are opening two more in the Kmart Parking lot. That will water down the work force available even more. I don't think it has anything to do with wages or hours, or peoples personal ambitions. I think it is and area wide over kill of the restaurant and food service industry.

Fred GUNDELL
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One solution of the worker shortage here is to eliminate the penalty on Social Security if you make over 25,000 a year. (1/2 Social Security is counted in that number) Especially now with the min wage at 15.00 an hour. Have you ever counted the McDonalds, Burger King, Arby's, or Wendy's, Romans, Hawaiian Restaurant, Eli Fish, Terry Hills, Tim Hortons(3), Duncan Doughnuts(2) Denny's , Settlers, Batavia Downs, AppleBee's`, Sport of Kings, That Taco Place, Taco Bell, KFC, Batavia Country Club, the various Oritental and Mexican restaurants, Miss Batavia, and I am sure I missed somebody. Now add in 10-15 Pizzerias and more Bars. It is no wonder in a small city of 15,000 that they can not find any workers or cooks.

Fred GUNDELL
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Opps, I overlooked Red Ozier, 5 Guys, Town and Country , Alex's, Tully's and TF Brown's. That folks is over 60 food service businesses in our town of 15,000 people. If each employs 30 people(and I submit some employ much more) that is 1800 employees required. If 1/2 our population is work age and physically fit, then that number is only 7500 to draw the 1800 from. It is no wonder we have a staffing problem at restaurants.

Howard B. Owens
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So we need more immigrants.

John Roach
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Howard, we need more legal immigrants with skills that will not burden the taxpayer more.

Howard B. Owens
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John, we need laws that make legal immigration easier that allow more workers of all skill levels to enter the country, particularly those willing to work in farms and kitchens. Right now the laws are designed to thwart legal immigration, so hard-working people are forced to try and cross illegally to seek opportunities to earn money to support their families.

John Roach
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Howard, that's why I said we need legal immigration.

Howard B. Owens
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John, your comment could be read as "we need legal immigration within the current U.S. policies" so I responded as I did, especially coupled with the "will not burden the taxpayer more."

The current legal framework is based on progressive xenophobia, since adopted by so-called conservatives. It doesn't meet our nation's economic needs and creates a crisis of illegal immigration, which makes it harder to secure our borders. We need a legal framework that can legally bring in one million documented, vetted immigrants into the nation pronto. That can't happen under current law and under the current political environment.

John Roach
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We need immigration law reform that allows more skilled people to come here. Clearly our job market needs that.

Howard B. Owens
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It depends on what you considered skilled -- dishwashers, busboys? Clearly, we need more entry-level restaurant workers. Hotels need more cleaning staff. We clearly need anybody willing to work regardless of training and experience level. They all help grow the economy and contribute to tax revenue.

Tim Miller
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Great article, Howard, and the comments and back-and-forth added value to it.

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