Dive Brief:

• TGI Fridays is reimbursing its general managers up to $2,500 for vacation expenses, Bloomberg reports. The perk was rolled out this year to help mitigate labor shortages affecting the restaurant industry.
• The casual dining chain is also offering general managers bonuses to help cover health insurance costs, per Bloomberg.
• About 650,000 fewer workers are employed in foodservice than in January 2020, and the sector has seen only gradual employment increases since July 2021, according to the U.S. Bureau of Labor Statistics. The quit rate is also at an all-time high — about 6.9% (920,000) of foodservice workers quit in November.

Dive Insight:

Fridays' vacation reimbursement is a creative approach to paid time off, which many restaurant chains have expanded throughout the pandemic to attract talent and keep existing employees. The full-service category is more challenged by the labor crisis than its quick-service peer, according to Moody's.

Last spring, Taco Bell began offering general managers up to four weeks of accrued vacation per year. Some restaurant owners have taken their employees on vacations to show appreciation for their staff's work throughout the COVID-19 crisis. Danielle Jones, owner of Abenaki Trail Restaurant and Pub in New Hampshire, pays for flights and accommodation for her employees every year. Jones told Business Insider that she hasn't had issues finding staff to keep her restaurant running.

Fridays CEO Ray Blanchette told Bloomberg the chain's two new benefits should bolster retention for both managers and hourly employees striving for promotions. 

Employees are leaving the restaurant industry in droves for several reasons, which may be too complex to be solved by vacation stipends or small raises. The current labor market problems exist despite average pay for restaurant workers surpassing $15 an hour for the first time ever last year. 

BlackBox/Snagajob data found that 23% of workers are leaving restaurants to find more consistent scheduling and income, and 17% are leaving because they lack access to professional development opportunities. As many as 33% of hourly workers would like to change industries, according to BlackBox/Snagajob data. Further, a majority of surveyed restaurant workers reported experiencing emotional abuse or disrespect on the job during the pandemic.

Operators have deployed a variety of tactics to solve the labor shortage — from free iPhones to enhanced educational benefits and hiring bonuses. The needle hasn't moved much so far though, according to the National Restaurant Association's State of the Industry Mid-Year Update for 2021. Three out of every four restaurant owners reported employee hiring and retention as their greatest difficulty.