SALEM — Jobs in restaurants and taverns frequently sit at the bottom end of the pay scale, with waiters, line cooks and bartenders sometimes treated as easily replaceable — and paid accordingly.
COVID-19 has turned that calculus on its head.
Pandemic shutdowns put thousands of Oregon hospitality workers out of work. And as the economy reopened, hotels, restaurants, taverns and gyms are finding they have to pay a premium to get those workers back.
Oregon’s average hospitality wage has jumped by an astonishing 10.5% in just the past 12 months, to $19.49 an hour in July. For a full-time worker, that works out to a $3,800 raise on an annual basis.
Many hospitality businesses are offering bonuses to bring in workers. The McMenamins hotel and brewpub chain is offering $1,000, for example, to new hires who take jobs as line cooks or kitchen managers.
The dramatic pay hikes reflect the weird economics of the pandemic.
It took nearly nine years after the Great Recession for Oregon hospitality wages to return to their pre-downturn levels. At that time, the economy was very slow to regain its footing.
In the wake of the pandemic recession, though, most sectors snapped right back. And businesses in those fields that recovered quickly began snapping up workers, some of whom had been laid off from their old jobs in the hospitality industry.
That left restaurants, hotels and bars struggling to find staff to fill their establishments — and paying a premium to get those workers they could find.
The numbers show that these businesses have been only partially successful. Leisure and hospitality employment remains down 18% from the summer of 2019, even as the rest of Oregon’s economy has largely recovered.
Why does Oregon have fewer people working in leisure and hospitality now? Well, bartenders and waiters didn’t pack up and move out of state. Instead, many of them took other work while their old jobs were shut down by the pandemic.
“A lot of them just said, ‘I need to work somewhere,’ and looked around, and found something else,” said David Cooke, economist with the Oregon Employment Department.
Amazon and other online retailers and delivery services continued hiring through the pandemic and raised wages as it became harder to find workers. Oregon wages are up overall, so hospitality businesses had to raise their own pay to catch up.
“It’s based on supply and demand,” Cooke said, “where the supply of people who are available and able and ready to work is relatively low compared to the demand.”