Jonathan Maze | Restaurant Business | April 19, 2018

As the labor market continues to tighten, restaurants are encountering a new competitor for a thinning pool of employees: Uber.

The ride-hailing service and similar companies that make up the gig economy are adding a new layer to the challenges of finding good workers.

Already facing high turnover and decreasing teenage labor participation, restaurants now have to compete with the independence and flexibility that such services provide to drivers.

“Restaurants are very vulnerable to the gig economy,” Victor Fernandez, executive director of insights and knowledge for the data firm TDn2K, said during the Restaurant Leadership Conference in Phoenix this week. When analyzing people who drive for companies such as Uber and Lyft, he said, “We’re really the primary match for that employee.”

Fernandez noted that two out of three front-of-house employees are part-time, working 25 hours. And they typically make low wages.

Those workers can be tempted by the flexible hours and independence that working for one of the delivery or ride-hailing services provides.

“Someone who suddenly discovers Uber is not looking at replacing 40 hours, they’re replacing 25,” Fernandez said. “We’re not offering full-time jobs. That’s why it’s so easy from the money perspective, the money and the flexibility.”

Low unemployment and strong hiring by restaurants have created an environment in which it’s difficult to find employees. Restaurants have added 200,000 jobs over the past year, according to federal data, and have added jobs at a higher-than-average rate for years.

That has shed a light on the competition the industry is facing for a dwindling pool of available workers from a growing number of competitors. Restaurants simply aren’t used to competing with companies that can offer the flexibility that ride-hailing services and other gig employers can provide.