Businesses like McDonald’s and Starbucks are cutting store hours because of the labor shortage and Omicron surge

·3 min read

Businesses across the country are reducing their working hours in response to a labor shortage and ongoing coronavirus surge that show no signs of letting up.

McDonalds, Starbucks, and Chipotle are just a few of the companies that have announced some of their locations will experience reduced working hours.

McDonald’s locations across the country are open 10% fewer hours on average than before the pandemic, CEO Chris Kempczinski recently told Wall Street Journal earlier this month, attributing the reduced operating hours to staffing shortages. And Starbucks has announced that nearly 9,000 of its cafes across the country will have modified store hours due to rising concerns over customer and worker safety, the outlet reported.

It’s not just the food industry that is reducing its operating hours. Retailers have also suffered from the current staffing troubles. In the beginning of January, Macy’s decided to reduce its operating hours by two hours, four days a week, for the rest of the month.

A factor to those labor shortages is America’s so-called “Great Resignation”—a record 4.5 million workers voluntarily quit their jobs last November, the most recent data available. Sectors like foodservice have been particularly affected, creating a major shortfall of workers over the past several months.

“We saw about an average of one-hour reduction in operating hours at Popeyes during this quarter relative to pre-pandemic levels,” José Cil, CEO of Restaurant Brands International, which manages several fast food chains including Burger King and Popeyes, said in an earnings call at the end of October.

The surge of the highly-contagious Omicron variant in December has compounded the U.S. labor shortage. Companies and businesses that were already unable to hire new workers have suddenly had to contend with sickouts among remaining staff.

In a recent email to customers, Starbucks announced that several of its locations would begin reducing their operating hours, referencing the number of workers currently out sick due to COVID.

“We will always make proactive decisions that prioritize the health and well-being of our customers and our partners,” Starbucks said in its email, obtained by USA Today.

Starbucks warned clients that they may experience a lack of specific products, halts on mobile ordering, and reduced payment options as a result of the staff shortages. The coffee giant also recommended customers check its mobile app before heading to a location, as the company will be continuously updating the working hours of each of its shops.

Starbucks made headlines last week when the company announced it would be lifting its vaccine requirement for employees, in the wake of the Supreme Court’s ruling to halt nationwide vaccination mandates for private companies. While it is unclear if Starbucks’ decision will provide relief to its hiring woes, the confluence of an Omicron surge and an ongoing labor shortage is likely to exacerbate staffing shortages in the near future.

Not all retailers and restaurants, however, have been forced to close locations or reduce working hours. Some have been able to stay profitable and maintain normal working hours under the current circumstances, even posting increased profit margins. Dutch Bros Coffee, for instance, reported in November that its sales had increased by over 10% over the last two years, and by 7.3% over last quarter’s performance of the same stores. The chain’s executives—who manage 500 drive-thru coffee shops across the U.S.—believe that the company’s drive-thru model requires fewer workers, who feel safer as part of the work is outdoors.

In an interview with Restaurant Business, Dutch Bros CEO Joth Ricci said he believed that the company’s ability to stay open has helped boost team morale.
“There’s great chemistry in the stands. It’s a great place to work. People enjoy it. It’s a different work environment than you might get at other drive-thru locations.”

This story was originally featured on Fortune.com

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