I recently found this blog after the supremely public blow-out brought to us by Amy’s Baking Company. I will be very honest – I have a very limited experience actually working in the service industry. When I was 17, I worked at JCPenney for the summer before college and then quit because I am incapable of putting on a mask and being nice to someone who I’d like to see fall down several flights of stairs while holding a dozen pairs of scissors inside of glass vases.
I have been very fortunate and have been given the opportunity to find success in an industry that suits me. I, however, do not believe that I am owed any sort of special treatment, butt-smooching, or anything of the like and am very opinionated on what is right and fair.
There are certain inescapable facts when it comes to the service industry, particularly those working in the restaurant (or the hospitality industry in general):
1. Shifts are not guaranteed to be scheduled, organized, or flexible. You can’t necessarily up and leave whenever you want and your shift may change throughout the week, depending on the establishment. 2. “Tipped staff” minimum wage is bullshit and everyone knows it. It is Herman Cain’s lasting legacy. Do you remember that ridiculous 9-9-9 guy from the 2012 Republican Presidential Primary who paid hush money to a woman who he had an affair with but was actually just a friend and all of that nonsense? Cain was formerly the president of the National Restaurant Association and was directly involved in lobbying to keep restaurant staff paid as little as possible so that the restaurant industry as a whole could keep costs at ridiculously low levels while continually increasing the price of food.
Exhibit C: Herman Cain Calls Obama’s Minimum Wage Increase ‘Dead Wrong’ On Fox
Still don’t believe me? Here’s their official statement presented to Congress on how restaurants operate on very low profit margins and can’t afford to pay their servers a wage that any American can afford to live on: Statement on Behalf of the National Restaurant Association
The National Restaurant Association is lying whenever they talk and they have good reason to: there is a lot of money at stake and servers are just too damned greedy. This group, specifically Herman Cain, has cited that restaurants operate on paper-thin profit margins, at just 2-5%, so those poor little businesses just can’t afford to pay employees more than $2.13 an hour.
This article was written based on numbers published by the other NRA: The Average Profit Margin for a Restaurant. And this article lists the reasons why restaurants fail during their first year. Interestingly enough, none of those reasons are “servers just cost too dang much”: Why Do 90% of Restaurants Fail in the First Year. But that figure they cite is pretty scary isn’t it? 90% of restaurants fail during their first year! That’s pretty shocking! 90% failure rate and a 3.5% profit margin, why in the world would any reasonable person open a restaurant?! Oh, because neither of those figures is actually true.
In fact, about 26 to 30% of restaurants fail during their first year, as the authors of this research article explain: Why Restaurants Fail. The reasons are generally related to business-knowledge; Why do 60% of the restaurants featured on Ramsey’s Kitchen Nightmares fail anyway? Because Ramsey isn’t working with savvy business owners; he’s basically trying to teach people who are overwhelmed and often in over their heads how to own and run a business while teaching them how to cook and serve food all within the span of a couple of weeks. Some of the quick learners will latch onto this and soar, most will just flail in the hole they’ve dug for themselves.
And, as for that bit about the 3.5% profit margin, that is a huge lie meant to conceal the fact that restaurants can and often do make a boat-load of money and only benefit from not having to pay servers as much as a retailer would have to. According to research that Paul Weyland has conducted (he conducts training seminars on something), independent restaurants should be making a gross profit margin of about 58% to be considered “healthy”: Gross Profit Margin By Industry. So, to break it down a little, a restaurant should be spending less than half of its total revenue on the cost to sell its products (the food). That makes sense, doesn’t it? There may be other, unanticipated costs and in business, there will always be risk involved. A capitalist sees no problem with a business owner claiming a profit in exchange for taking the risk of starting a business in the first place, but a smart capitalist sees the exploitation and underpayment of a large number of people as a very significant risk to the system as a whole.
If a server struggles to afford rent, a landlord may not get paid and may lose money in court fees, regular maintenance, and so on. Grocers may lose money as servers who would otherwise purchase some items stray away (and the grocer’s profit margin is significantly lower than the restaurant’s according to Mr. Weyland). A server who can’t afford health insurance or medical expenses may be one of the many people who goes to the emergency room for general care that they can’t and will never pay for. This raises the cost of medicine and subsequently health insurance for everyone else. A server who can’t afford school supplies for their children is not able to allow their children educational opportunities that would give them more options later in life, which means, you’re flirting with the dangerous possibility of creating a permanent caste system in this country that is supposed to be all about upward mobility.
So, in essence, people need to stop bitching about servers being greedy about tips. If you know you’re $30 away from being evicted from your apartment or NOT affording tuition this semester, you’d be a little antsy too. Servers deserve the exact same level of protection and rights that everyone else does. The regular minimum wage isn’t high enough. Everyone should be making at least $9/hour. That is even challenging to live on in most states (and believe me because I did just that while I was in college).
As someone who has never worked in the service industry but has coherent thoughts in my head, I support servers being paid more AND getting tips. I could go to a restaurant where I have to bus my own table, get my own drink, and pay attention for when they call my order out, but I didn’t. I chose to go to a restaurant where someone is designated to serve me food, check in on my needs, and allow me to have an uninterrupted conversation with family, friends, or whoever. If you work, you should be paid a wage higher than that of an indentured servant, and if you serve others, you should be tipped for that extra labor that you perform, and it is extra labor. Anyone who says otherwise is not like me; they cannot afford to go out and eat where they will be served by someone whose job it is to make your evening as lovely as can be. So, suck it up, go home, and heat up a Lean Cuisine.