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Restaurants and hotels have nearly 1 million job openings to fill

Hiring crunch means better pay, senior workers
Scenes from a hiring crunch: Hiring parties, better pay and senior workers 01:07
  • The low unemployment rate makes it tough for companies to recruit and hire talent.
  • The restaurant and hospitality sector has 991,000 job openings.
  • Some employers offer more pay and better benefits while others recruit senior workers, ex-convicts.

A near record number of Americans are employed, and the ensuing labor crunch is forcing companies to either offer workers better pay and benefits or cast a wider net when recruiting. In April, the unemployment rate dropped to 3.6 percent, its lowest point since December 1969, when it stood at 3.5 percent. 

Restaurants in particular are struggling to fill open roles: The restaurant and hospitality sector has 991,000 job openings, with 1.6 million new jobs expected to be created by 2028. Forty percent of the industry's 15.1 million employees are between the ages of 16-24 -- an age demographic that's expected to shrink by 1.3 million people over the same time period, according to the National Restaurant Association.

And so restaurants are rethinking who -- and how -- they hire, starting with the recruiting process. 

McDonald's last week announced that it's partnering with AARP to hire older works to staff morning and midday shifts -- roles that the company has struggled to fill lately.    

And Taco Bell last week hosted hundreds of "hiring parties" across the country to cull talent from a tight labor market ahead of the industry's busiest season -- summer. The Irvine, Ca.-based fast food chain anticipates hiring roughly 10 additional workers for every one of its more than 7,000 locations. Attendees mingled with current workers, partook in on-the-spot interviews -- some of which resulted in immediate job offers. Everyone took home giveaways including free food and Taco Bell swag. 

Jobs report: U.S. adds 263,000 jobs in April, unemployment drops 00:44

"We wanted to take an innovative twist on the whole job fair hiring process," said Bjorn Erland, Taco Bell's vice president of people and experience. "I think why they've worked is they are informal, you learn a lot about the brand, people come in and have a lot of fun talking to our team members, who are probably the best brand advocates for why you'd want to work at Taco Bell," he said.

Hiring parties also increase the application flow through traditional channels, like the company's website, Erland said.

For their part, job-seekers say the relaxed environment offers them a better window into the company's culture. Deja Mason, 23, attended a hiring party at a Taco Bell Cantina restaurant in Manhattan, and found it "very welcoming."

"I am more comfortable coming in as opposed to a standard interview where I am shaking and nervous and my palms are sweaty. I really enjoyed this party versus feeling like I am on trial," she said. 

Other companies are enticing applicants by offering better pay and benefits, including tuition assistance and workplace flexibility. Earlier this year, Walmart said it would hire 900 truck drivers and pay them nearly $90,000 a year, compared to $43,680, the median annual pay for heavy and tractor-trailer truck drivers in 2018, according to the U.S. Department of Labor.

"We have stepped up our recruiting, improved and streamlined our onboarding process and increased driver pay," Walmart told CBS MoneyWatch in January.

Fortune 500 names like Starbucks and Disney are using education for recruitment, partnering with universities to offer college achievement plans that include full tuition coverage through graduation.

Which U.S. job has seen biggest wage gain? Bartender 01:00

Smaller companies also find they must get creative when filling openings. Leo Kremer, co-owner of fast casual restaurant chain Dos Toros, is looking beyond the mainstream labor pool to recruit from other populations, including ex-convicts, through a program called Getting Out and Staying Out (GOSO). 

What's good for society is also good for business, Kremer explains. "It's a total win-win. We feel like we're having a positive impact on the community, but it makes sense for completely selfish reasons, too, in terms of being exposed to great talent, especially in a tight labor market," Kremer told CBS MoneyWatch in March. "Whenever you're able to meet more people and see more candidates, it's going to result in better hiring," he said.

Dave Pachter, co-founder and executive chairman of JumpCrew, a company that sells integrated marketing, lead generation and sales services to businesses including Twitter, is also looking beyond the traditional pool of applicants to fill positions at his 350-person operation, headquartered in Nashville, Tenn. His method is working. JumpCrew in the past 100 days hired 100 people, some of whom had little-to-no related prior experience.

His approach to hiring stems from an understanding that career paths aren't linear. "We are not shy about interviewing and hiring folks that have encountered setbacks in their careers due to a personal or professional outcome that was beyond their control," Pachter said. 

"We are looking for people who might otherwise be looked over but who are authentic and honest enough to talk about what they learned and how they grew. Of course we also look for people who have demonstrated some ability to fulfill commitments," he said.

While hiring with no experience can be treacherous, some of JumpCrew's most successful team members were relatively green when they joined the company. "One of our top performer's job before this was delivering pizzas," Pachter said.

One thing that's non-negotiable? Commitment.

"The days of a lifer crested a long time ago, but we are looking for people who want to see the next level of their careers through at JumpCrew," he said. 

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