Lots and lots of jobs data to parse. Smokey Bones opens a virtual food hall. Robots get more personable. Line balk continues to impact drive-thru service—these stories and more this week in foodservice.
Despite healthy job growth, restaurant operators remain concerned about the future.
First, the good news. Eating and drinking places added 60,000 jobs in September, per data from the U.S. Bureau of Labor Statistics. This was up from 25,700 jobs in August. For the year, restaurant industry employment growth is now greater than 500,000 positions. Despite these gains, industry employment remains at 560,000 fewer jobs than pre-pandemic staffing levels, which is the most among all U.S. industries, per the National Restaurant Association.
As part of a September tracking survey fielded by the NRA, only 8% of restaurant operators said they expect economic conditions to improve in six months. That was the lowest reading in the 20-year history of the monthly survey. In contrast, only 43% of operators said they think economic conditions will worsen during the next six months. The 35-percentage point gap between the two readings represented the largest net negative differential since the financial crisis in 2008, per the NRA.
Does that mean the U.S. economy is in line for another economic slowdown like it experienced in 2008-2009? Not necessarily. Per the NRA, “Instead, this is more likely an indication that we are currently in the midst of one of the most telegraphed economic slowdowns in history.”
Economic News This Week
- U.S. employment increased by 263,000 jobs in September, per data from the U.S. Bureau of Labor Statistics. This is the smallest monthly increase since April 2021.
- Private sector employment increased by 208,000 jobs in September and annual pay was up 7.8% year-over-year, according to the September ADP National Employment Report. Small businesses (1-49 employees) added 58,000 jobs. Medium-sized businesses (50 to 499 employees) added 90,000 positions. And large businesses (500+ employees) added 60,000 positions.
- Initial claims for unemployment totaled 219,000 for the week ending Oct. 1, 2022, per data from the U.S. Department of Labor. This represents an increase of 29,000 from the previous week’s revised level. The 4-week moving average was 206,500, an increase of 250 from the previous week's revised average.
- The outlook among small business owners increased in September, per the NFIB. The organization’s Small Business Optimism Index increased 0.3 points for a reading of 92.1. Despite this modest increase, the index has been at less than its 48-year average of 98 for 9 months. In addition, 30% of owners report inflation as the single biggest problem impacting their businesses. Small business owners expecting better business conditions over the next 6 months improved 10 points from July to a net negative 42%, the highest level since February 2022, but a dismal outlook.
Foodservice News This Week
- Smokey Bones has introduced a virtual food hall that integrates five of its restaurant concepts into one website. BiteHall includes Smokey Bones, The Wing Experience, Burger Experience, Bowl Market and Tender Box. (The last two are new virtual brands launched by the multiconcept operator.) Customers can select menu items from any of the concepts, pay for everything in the same check, and have all the food picked up or delivered on the same transaction.
- Jamba’s robots are becoming more human-like and interactive. The chain revamped its autonomous robotic smoothie kiosk, per published reports. The robot now sports “googly eyes” and can even dance. Jamba has deployed the revamped bots to the Ackerman Student Union on UCLA’s campus in Los Angeles and at a Love’s Travel Center in Williams, Calif.
- Do you balk at the line at drive-thru windows? It’s an emerging phenomenon among some consumers. Line balk occurs when the drive-thru line is so long that it makes customers pass on joining it. The problem began in 2020 when dining rooms were closed during the COVID-19 pandemic and drive-thru service was the only option in many cases. And just like working from home and video conferencing, line balk will not go away. In an attempt to knock down the line faster, some chains are equipping employees with handheld devices and having them take orders as they walk the drive-thru lines. Other chains are trying in-house apps, and some are even trying artificial intelligence programs as a means to speed service.
- Sysco is dealing with union actions at more than a dozen locations across the country. Sysco and the teamsters’ union have been presenting widely different versions of the other’s positions on wages and benefits. Sysco says its Boston facilities are operational but did note things were running as normal.
- q Chicken will test a new labor-efficient design that allows customers to order at a kiosk or online and then pick up their order from a locker with little or no human involvement, per published reports. The Korean based chicken chain offers three variations. bb.q Chicken express offers takeout and delivery only. bb.q limited chicken café is a more fast-casual limited-service version. And bb.q Chicken and Beer is a full-service version with a bar. bb.q Chicken is not a barbeque chain but rather bb.q stands for “best of the best quality.”
- Growth Chains: bb.q, the Korean chicken chain has about 115 units in the U.S. of which 2 are corporate owned and the rest are franchised. The company plans to have 250 locations in the U.S. by the end of next year and 10,000 units worldwide by 2027. Hi Five Chicken has five restaurants open and has signed real estate commitments to open six more locations in British Columbia. Salad and Go plans to open three more units in the Dallas-Ft. Worth market this month. These openings will bring Salad and Go to 25 units spread across 20 Texas markets. A co-branded Johnny Rockets and Hurricane Wings opened in Washington, D.C. The Habit Burger Grill opened a location in Watsonville, Calif.