Meyerson on TAP: How to Stop Restaurant Workers From Quitting

Anyone who’s looked into our nation’s record-high quit rate has found, not surprisingly, that the rate is highest among restaurant workers. If any explanation is needed, two new studies make clear why.

Yesterday’s New York Times reported on a study conducted by MIT economist David Autor and associates that found that the government’s Paycheck Protection Program and other pandemic relief programs had some cracks through which numerous workers tumbled. A second report, from the UC Berkeley Food Labor Research Center and the group One Fair Wage, examined one particularly glaring crack: In the 43 states where tipped workers receive subminimum wages well below the standard for other workers (the federal subminimum is a whopping $2.13 an hour), many were ineligible for the emergency benefits because they couldn’t document wage earnings high enough to qualify for the expanded unemployment insurance. (That’s a helluva catch, that catch-22.)

Virtually every restaurant in the land received badly needed PPP funds, but given the low wages that waitstaff workers made, even those able to access all the funds made available by the emergency legislation collected at most $26,300 spread over the 18 months that PPP was in operation.

No wonder that at least one million such workers have quit their jobs—with more still to come (or more precisely, go). “We surveyed 3,000 restaurant workers across the country,” Saru Jayaraman, director of One Fair Wage, told the Prospect, “and 54 percent of them say they’re going to leave.”

The glaring shortage of restaurant workers has compelled management at many such establishments to raise their wages, and may even compel states to raise the subminimum standard for tipped workers or, better still, eliminate the subminimum category entirely. It is already changing the political climate in which campaigns to raise the wage take place.

In Washington, D.C., for instance, voters approved a ballot measure in 2018 that would have eliminated the subminimum standard and enabled tipped employees to earn the city’s regular minimum wage, which is approaching $15. Under pressure from the local restaurant industry, however, the city council overrode the voters’ verdict (the ballot measure had only been “advisory”) and kept the wage at the local subminimum of $3.89.

With restaurants now beseeching workers to return to waiting tables, they’ve concluded they can no longer lobby for the subminimum standard. When One Fair Wage recently began collecting signatures to put a new measure to strike down the subminimum on the ballot in the next D.C. election, Jayaraman said, “the head of the D.C. restaurant association called me to say they wouldn’t fight it this time around. When we presented the measure to the Board of Elections, they didn’t even show up to register their opposition. No restaurant can oppose this measure at the same time they’re desperately seeking staff.”

This political opening, Jayaraman hopes, isn’t confined to D.C. One Fair Wage and its allies are planning to put a minimum-wage hike measure, which would include the elimination of the subminimum, on the Michigan ballot in November—a measure, she added, that might boost Democratic prospects in this swing state if, and only if, Democrats campaign so hard for it that its popularity rubs off on them. (Even in the reddest of states, voters have almost unfailingly passed minimum-wage increases, though this hasn’t invariably boosted Democratic prospects.)

At the federal level, the downturn in business caused by the omicron strain has prompted the industry to ask Congress to provide another round of financial aid to restaurants. If there’s going to be one more tranche of restaurant assistance, Jayaraman said, it should be conditioned on actually helping stanch the flight of the workers from the industry—80 percent of whom, in the Berkeley/One Fair Wage survey, said they’d stay only if they received significantly higher wages. The best way to do that would be to link any new federal assistance to the elimination of the munificent federal minimum of $2.13. Restaurant worker activists and advocates will descend on Capitol Hill next Tuesday to make that patently sensible case.