Dive Brief:

• Customer acceptance of restaurant automation is increasing, according a report published by Deloitte last week. This acceptance is driven primarily by younger customers, with 58% of those aged 18-38 saying they’d return to restaurants that use automation, compared to 42% of customers over the age of 39.
• A majority of surveyed consumers (60%) said they were “somewhat likely” to order from restaurants that automated some or all of their food production, up from 54% in 2021.
• Deloitte’s findings suggest large numbers of diners are unlikely to be deterred from eating in restaurants that use labor-saving devices or other technological automation. 

Dive Insight:

Customer acceptance was particularly high for order automation, with large majorities willing to try automated ordering at the drive-thru (79%), over the phone (74%), and in the dining room (70%). However, Deloitte’s findings did not find majorities in favor of all technology. Less than half, or about 47% of customers, would order from a restaurant using drones or autonomous vehicles for delivery, though that was an increase over the 2021 level (44%).

While younger consumers in general are more likely to accept automation than older consumers, there are differences within that cohort. According to a presentation by Technomic and Coca-Cola at the National Restaurant Association Show in May, Gen Z may be more skeptical about technology than millenials.

Still, customer sentiment is likely secondary to operational factors when determining technological adoption. Deloitte predicted that macroeconomic challenges, including workers’ ability to command higher wages, could prompt many restaurants to analyze their labor deployment.

“With a tight labor market, increasing minimum wages, and growing union pressures, there will likely be greater scrutiny over which tasks must be completed by workers, as opposed to technology,” Deloitte found. “This could either result in lighter restaurant staffing or shifting staff roles toward more customer service-oriented responsibilities.” 

But there’s some evidence that labor market tightness is easing, according to recent Bureau of Labor Statistic data. Wage growth in foodservice has been effectively flat through the first half of 2023, and employment in the sector has increased by about 134,000 workers since January. This is a jump of about 1.1%, a modest but measurable deceleration from the 1.5% job growth posted between January and May 2022. Sectoral unemployment is up as well, from a low of 4.9% in October to 5.4% in May. Labor turnover has eased as well, with the April 2023 quits rate falling below April 2022 levels by a full percentage point in accomodation and foodservice.

At the National Restaurant Association Show in May, back-of-house automation was in the spotlight at the show’s Kitchen Innovation Awards. Outside the show, adoption of technological solutions to combat rising labor costs is growing. At the end of May, in a major breakthrough for the drone delivery segment, Serve Robotics and Uber Eats signed a deal to deploy up to 2,000 of Serve’s delivery bots. Sweetgreen’s CEO recently told investors that the fast casual chain plans to eventually have automated makelines in all new restaurants.