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Monday, August 24, 2015

WSJ Article on Chipotle Hiring Plans

Julie Jargon's article, Chipotle Makes a New Kind of Play for Labor, appears on the front page of section B - Business and Tech, August 24, 2015.

She reports on a planned mass hiring day - September 9th.  Chipotle plans to hire 4,000 people on the single day increasing their workforce by nearly 7%.

The article features a graph of wage growth for limited-service restaurants vs. the entire private sector.  The source is Bureau of Labor Statistics.

LSR workers have seen wage growth of 6.77% in the 2.5 year period ended this June vs. 5.37% for the entire private sector.
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I checked on the Restaurant Investor Report for closing rates in the first half of 2015 for fast casual Mexican/Latin restaurants.  The closing rate was far below other sectors.
 
Chipotle's closings are a mere 1/8 of 1% (.00125).  Almost all Chipotle locations remained in business during the six month report period.

Independents and regional chains operating casual dining Mexican/Latin concept closed 4.83%.  The entire Mexican/Latin fast casual chains group saw a closing rate of 1.46%.  Mexican/Latin fast casual independents closed 4.36%.

Saturday, August 22, 2015

Seattle Area Restaurants Face Higher Wages

Fox News ran an interesting article, written by Dan Springer, a month ago on their website in the Politics section:

Seattle sees fallout from $15 minimum wage, as other cities follow suit by Dan Springer

The article focused on the impact of a higher minimum wage - $15 per hour.

In his article, Mr. Springer delved into the actions taken by restaurants:

"Some restaurants have tacked on a 15 percent surcharge to cover the higher wages. And some managers are no longer encouraging customers to tip, leading to a redistribution of income. Workers in the back of the kitchen, such as dishwashers and cooks, are getting paid more, but servers who rely on tips are seeing a pay cut.

Some long-time Seattle restaurants have closed altogether, though none of the owners publicly blamed the minimum wage law."

With regard to the issue of long-time Seattle restaurants closing altogether, there is a tick upward in closings reported by RestaurantData.com in the new Restaurant Investor Report.

In general, Seattle has a vibrant restaurant industry.  The report is very interesting with regard to independently owned full service restaurants, including regional chain concepts.

As of June 30, 2015, the report showed the 6 month closing rate for long-time (over 3 years in business) full service restaurants increased by 46% from 2.7% in the second half of 2014 to a 3.9% rate in the first half of 2015.

A solid 93.4% of full service restaurants owned by sole proprietors and regional chains remained in business.

Restaurant Data Pros

 
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