[Report] Developing the Next Generation of Industry Leaders

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As anyone who works in the industry knows—particularly those for whom a position at a restaurant was their first job—hospitality and foodservice offer young Americans a host of opportunities.

The industry represents more than just a first employment opportunity. There’s real longevity in this business for those who are passionate about service. Bartending, serving, managing—these are viable, lifelong careers, regardless of how many times friends and family ask when someone is getting a “real” job.

The National Restaurant Association expects 1.6 million jobs to be added to the industry over the next 10 years. Logic dictates that a significant percentage of these jobs will be filled by those identified as Millennials and Gen Z. Therefore, Baby Boomer and Gen X owners, operators and managers need to develop an understanding of the next generations of hospitality and foodservice industry workers to navigate the next 10 years successfully (and profitably).

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A report was recently released by the NRA’s Educational Foundation (NRAEF)1 that shares the results of research they conducted with the Center for Generational Kinetics (CGK), the top Millennial, Gen Z and generations research, speaking, and solutions company that solves generational challenges for global brands and employers. Among the discoveries through this collaboration are the perceptions held by Millennials and Gen Z in relation to the industry; if and how the desires of these younger generations can be fulfilled by the industry; and if and how operators and managers can leverage Millennial and Gen Z workers.

Perception

Kicking things off is a great discovery. The NRAEF and CGK found that both younger generations have a positive perception of the restaurant industry. In fact, more than 70 percent of these generations believe the restaurant industry is a good place for their first jobs. More than 80 percent revealed that employment in a restaurant was their first paying job.

Millennials entered the industry at the age of 18, whereas Gen Z got their start at 16-and-a-half. Those who work within the industry believe the experience has been satisfying or very satisfying over the last 12 months (74 percent of Millennials respondents, 69 percent of Gen Z respondents) and were offered the opportunity to acquire skills they feel are valuable.

So, what skills do these younger generations believe they can obtain through working foodservice and hospitality jobs? More than one quarter of Millennial and Gen Z asked that question identified the following:

  • Teamwork
  • Multitasking
  • Performing under stress
  • Customer service

Perhaps more valuable than learning the skills these employees feel they can develop is the discovery that Millennials and Gen Zers feel they can pick them up even if they only work in this industry for a short time. Short-term employees see immediate, valuable reward, and long-term workers believe there’s opportunity for real advancement: climbing the ladder into leadership, moving into fine dining, or finding their calling in a related specialist role.

Longevity

The positive perception and experience is promising for owners and operators seeking to fill positions and build strong teams. If Millennial and Gen Z workers are satisfied, they’ll see long-term employment in the industry as realistic, particularly if they believe they have they can advance in their careers.

Read this: Train Your Way to a Hospitality Empire

Workplace culture plays a role in attracting and keeping younger generation workers. An establishment that places emphasis on recognition, reward and flexibility is rated as ideal by more than a third of Millennials and Gen Zers. Pay and management also play significant roles in staff retention and maintaining a positive perception of the industry. Good pay and working for a good manager (someone who listens, recognizes, rewards, engages and mentors) were identified as the top two conditions that would “absolutely convince” Millennial (47 percent) and Gen Z (28 percent) workers to stay in a foodservice and hospitality job after 6 months of starting it. Millennial women (52 percent) and Gen Z women (30 percent) value both conditions more than their male cohorts.

Interestingly, it’s not just the obvious career choice (bartending) that appeals to younger generations. The NRAEF and CGK found through their research that while around one-third of Gen Zers consider bartender as an aspirational role within the industry, they’re also interested in becoming owners and operators themselves. Operators and managers who nurture the careers of the younger generations are helping develop future owners and innovators who, if provided a positive experience and healthy career trajectory, will one day return that favor and keep this industry going.

The research shows that 40 percent of Millennials and Gen Z in foodservice and hospitality currently hold jobs within quickservice venues, whereas 26 percent of these generations work in casual dining. They’d like to expand their roles, however. According to the research, 39 percent would like to obtain experience in the fine dining space, and 36 percent are interested in gaining skills in specialties such as baking.

Behavior

At this point, everyone is aware that Millennials and Gen Z make decisions regarding where to spend their money and time and what brands to support based on reviews and recommendations. It shouldn’t, therefore, come as a surprise to learn that they also decide where to seek employment in the same way.

The NRAEF and CGK learned that 73 percent of younger generations are influenced (and highly influenced) to apply for a job at a restaurant with a reputation for being a good place to work. Seventy-one percent would be influenced by a positive recommendation from a family member or friend who has worked at a restaurant, and the same percentage find paid, on-the-job training by a restaurant influential enough to make them apply for a job.

Read this: Stop Whining About Hiring

Clearly, online reviews influence more than just customer visits. Operators seeking to build teams with the best the workforce has to offer need to be acutely aware of their reputation as employers. Of the Millennial and Gen Z respondents surveyed, 64 percent are influenced to apply for employment if a restaurant has a positive reputation on an employment rating sites. Yes, on top of managing online customer ratings and reputation, operators need to be aware of their reputation among employees.

And it doesn’t stop there. Some people apply for employment because they enjoyed their visit and experience at an establishment. How powerful is a positive guest experience to applicants? Sixty-three percent of Millennials and Gen Zers surveyed said that it would influence them to apply for a job. Operators aren’t just training guest-facing professionals, they’re attracting future team members.

It’s safe to say that Nightclub & Bar has eschewed the trend toward mocking or having fun at the expense of Millennials and Gen Zers. They are, after all, the future team members, managers, owners, operators and innovators of this industry. That’s to say nothing about the fact that, using 1996 as a cutoff for the last year of Millennial births, Millennials—the largest living generation in the United States—are a massive customer base.

While the “jokes” about younger generations are about addiction to technology, we aren’t surprised that the NRAEF and CGK found that they seem to rely on tech and traditional human interaction equally when seeking work. The research reveals that an equal amount, 63 percent, of Millennials and Gen Zers surveyed about finding job openings would use the following methods:

  • Ask a foodservice worker they know.
  • Search a job site.

An equal amount, 60 percent, would:

  • visit a restaurant personally to inquire about employment;
  • ask friends of family about available jobs.

So, no, they don’t all live their lives solely on phones, tablets and computers. Attendee-favorite Nightclub & Bar Show speaker Kelley Jones’ experience employing many Millennials corroborates the finding that younger generations don’t exhibit a preference for communicating via phone versus interacting in person versus a hands-off approach; they prefer a combination thereof.

Another promising characteristic of younger generation workers is that they know what they want to get out of a job. There have always been and will continue to be those unmotivated workers who want nothing more from a job but to work their assigned shifts, do the bare minimum, and receive a paycheck. But research shows that Millennial and Gen Z employees trend toward:

  • a preference for being active at their place of employment (80 percent);
  • enjoying working with a diverse group of people (80 percent);
  • creating and trying new things at work (84 percent);
  • wanting their workdays to vary in terms of responsibilities and experiences (70 percent);
  • expecting to pay to directly reflect performance (70 percent);
  • a preference for a fast-paced work environment (70 percent);
  • handling stress well (70 percent).

Operators seeking to engage Millennial and Gen Z workers—which can help to curtail turnover—should keep them stimulated, reward their hard work, make their feel that their input and ideas are valued by management and ownership, and offer them shifts during which they work in a different role.

Challenges

Not all the findings by the NRAEF and CGK were positive, of course. The industry does face several challenges in terms of training bar, restaurant and nightclub professionals for career longevity, along with developing the future owners, operators and managers. The good thing is that these challenges can be managed.

When asked to select what they felt were challenging aspects of the industry, both Millennials and Gen Z respondents chose the stress of dealing with customers (25 percent), environmental stress (25 percent), and compensation (23 percent).

Less than a quarter (22 percent) said they left the industry because they weren’t making enough money. However, it was finding “something better” for work that was revealed to be the number one reason for Millennials and Gen Zers to leave the business (31 percent).

Read this: Building a Service Team that Dominates

It’s true that the research conducted by the NRAEF and CGK finds that many younger generation workers had good experiences working in the industry. But 43 percent believe the jobs available are mostly of the dead-end variety. Unfortunately, 35 percent hold the perception that the foodservice and hospitality industry is meant for people who lack the skills to work in other industries.

Operators can change these perceptions and stem the labor force hemorrhaging by identifying the educators among their more experienced team members and encouraging mentorship. Millennial and Gen Z respondents indicated that mentorship helps them to develop their skills (40 percent) and confidence (38 percent). More than half of these younger generations (53 percent) who have considered entering the industry have never had a mentor, with women and works who hold part-time positions less likely than others to have had mentors.

Compensation schemes and promotions may also need to be revisited by owners and operators. More than 50 percent of Millennial and Gen Zers expect to be promoted within 12 months of starting their jobs. The same percentage also expect increased compensation through higher salaries and bigger tips within just three months.

Millennial and Gen Z employees are the future of this industry. Successful, visionary operators see the opportunities these generations of workers provide.

Key Report Takeaways

  1. The first paid job for 81 percent of Millennials and Gen Z is in a restaurant.
  2. The perception that the foodservice and hospitality industry is a good place to find a first job is held by 71 percent of Millennials and Gen Z.
  3. More than a third of Millennials and Gen Z aspire to becoming owners and operators or entering a related specialty role.
  4. Unfortunately, only 47 percent of Millennials and Gen Z think the industry is good for long-term careers.
  5. Mentorship is one of the keys to retaining team members and improving perception of the industry.

* For additional data and information, follow this link to an insightful infographic.

1 Methodology: NRAEF and the Center for Generational Kinetics collaboratively led this research. A jointly designed, online custom survey was administered to 1,606 U.S. respondents, ages 16–29. The sample was weighted to current U.S. Census data for age, gender, and region. The survey was conducted online from March 27, 2018 to April 3, 2018. It has a margin of error of +/-3.1 percentage points.