McDonald's expanded its workforce in 2021, offering better wages and benefits to beat the labor shortage

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McDonald's hiring sign
A McDonald's restaurant on Penn Ave in Sinking Spring, Pennsylvania, in April 2021. Like other companies, the chain has been hit by a huge labor shortage.Ben Hasty/MediaNews Group/Reading Eagle via Getty Images
  • The total number of staff on McDonald's roster grew during 2021 despite the wider labor shortage.

  • CEO Chris Kempczinski said the firm offered higher wages and better benefits to secure staff.

  • Only 1% of McDonald's restaurants are on limited opening hours due to understaffing, he said.

Fast-food giant McDonald's revealed Thursday that improved employment packages enabled the company to expand its payroll last year despite the tight labor market.

McDonald's finished 2021 with more staff than it had at the start of the year, CEO Chris Kempczinski said on an earnings call Thursday. He attributed the increased staffing levels to higher wages and better benefits. Nearly all its US restaurants are now back to normal opening hours, he added.

A post-lockdown labor shortage devastated much of the restaurant industry in 2021, as record numbers of Americans quit their jobs in search of better wages, benefits, and working conditions. Others returned to education, switched industries, or took early retirement. Many businesses were forced to offer better conditions to staff in order to keep operating.

Some McDonald's franchise owners took more unusual measures to tackle labor shortfalls in 2021, with one calling on 14-year-olds to apply for jobs, another offering iPhones to new hires, and another handing out $50 to anyone who came for an interview.

"Our roster size at the end of '21 is greater than where we were entering into the beginning of the year," Kempczinski said at the company's fourth-quarter earnings call Thursday, without providing figures. McDonald's started 2021 with around 200,000 staff across its offices and company-owned restaurants globally, as well as more than 2 million workers across its franchise restaurants, according to filings.

The total number of workers in the US food services and drinking places sector rose from just over 10 million in January 2021 to 11.6 million in December 2021, per preliminary data from the Bureau of Labor Statistics. This is due to restaurants reopening after waves of lockdowns and increased demand as more diners eat out, but there remain fewer employees in the sector than there were pre-pandemic.

McDonald's didn't escape entirely unscathed, with staffing shortages forcing some of the chain's restaurants – like many others in the sector – to slash their opening hours and close dining rooms.

In mid-December, at the height of the Omicron variant surge, McDonald's US restaurants were on average open around 10% fewer hours than normal, Kempczinski said Thursday. But more restaurants have since been returning to regular opening hours, and only 1% are currently operating at limited opening hours, he said.

Kempczinski added that McDonald's US corporate team had been talking to franchisees about the benefits the company offered its staff beyond just wages "to make sure that we've got the best proposition to get people in our restaurants," including paid time off, tuition fee reimbursement, and ways to recognize and reward their staff.

"All of those things cumulatively – wages, focus on the employee value proposition, and just engaging with the crew – is what allowed us to make the progress," Kempczinski said.

Kempczinski said that the company expected there to still be pressure on wages in 2022 and that it was thinking about how to reflect this in pricing.

"Our franchisees have done a phenomenal job working through what is a really challenging staffing environment," Kempczinski said. "Omicron certainly didn't make that any easier."

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