TOPEKA – The statewide restaurant industry has been plagued by the ongoing COVID-19 pandemic, inflation and workforce shortages, with new problems making it difficult for restaurant owners to recover, officials said .
At a House Commerce, Labor and Economic Development committee hearing Tuesday, Kevin Timmons, a restaurant owner and vice president of the Kansas Restaurant and Hospitality Association, told lawmakers about his recent struggles with inflation.
“There is a three-headed monster in the manufacturing sector that faces restaurants, from meatpacking to plastic manufacturing to everything we get overseas,” Timmons said. “It’s raw costs, it’s labor and it’s transportation costs, and this three-headed monster, even though there’s been some deflation and we’re starting to get our hands around it, still has our industry in flux.”
Timmons said employment levels have mostly recovered from the pandemic, citing 2019 Kansas Department of Labor statistics. In 2019, the department listed up to 114,034 lodging and food service workers in a report Q2 Census Employment Report. In 2020, that number dropped to 82,530. Currently, the industry has about 108,430 Kansan employees, 5 percent fewer than pre-pandemic levels, Timmons said.
As the number of workers has increased, Timmons estimated that there are 800 fewer licensed food establishments in Kansas, with many owners concerned their businesses won’t see an increase in profitability in 2023.
“When we reopened our doors, it was a different world before us,” Timmons said. “Raw material and labor costs, fuel and transportation costs, and the looming day-to-day battle for everyday products have left our industry somewhat decimated.”
Rep Stephanie Sawyer Clayton, D-Overland Park, questioned him about server salaries, saying raising them would be a good way to find more staff. Clayton said the salary hadn’t been raised in years and she knew firsthand the effect wages had on staff morale.
In Kansas, the minimum wage for tipped employees is set at $2.13 an hour. Neighboring states, like Missouri, have attracted servers from Kansas by raising the minimum wage for employees. The Missouri minimum wage for tipped employees is now $6 an hour.
Timmons said the pay raises weren’t that important and that he had seen servers returning to Kansas from Missouri because they cared about customer happiness.
“I’m in the business of making people happy,” Timmons said. “And the happier they make them, the more they make, and that’s service.”
Clayton said that was not the case in his experience.
“When I waited tables, I didn’t do it for personal fulfillment,” Clayton said. “I did it because I needed to go to college. And I needed the money. People don’t wait tables to make people happy. They work to make money.
The lawmakers also asked Timmons if social factors are an issue for rising food costs. Representative Kristey Williams, R-Augusta, said farmers in the Netherlands are under pressure to reduce carbon emissions, which could potentially drive up the prices of imported cheese and the prices of other products.
“Is this something we should all be keeping an eye on in terms of ESG, social governance of the environment?” Williams said. “Because if that can have such an impact in a couple of areas, where do you think long-term that might play into the cost of these edge products?”
Timmons said corn and soy price inflation could be a factor in rising restaurant costs.
