While many iconic restaurants on Providence’s Federal Hill are starting to see a revival, the lights at Siena on Atwells Avenue remain off, tables empty and the doors locked.
The restaurant first closed in March 2020 due to state orders. Continued restrictions seemed too burdensome to justify reopening the restaurant later on. It does little takeout business compared to the Smithfield and East Greenwich locations, and the workers at nearby state offices and weekend theatergoers who comprise its customer base had disappeared, said co-owner Anthony Tarro.
Now what’s standing in the way of reopening is not the virus or state rules: it’s lack of workers. Tarro is already short-staffed at the other two restaurants and has struggled to fill the two dozen open positions.
This doesn’t square with the state’s 7.1% unemployment rate in March, the latest data available. Just under 68,500 people collected continuing unemployment benefits as of the week of April 27, according to R.I. Department of Labor and Training data.
And here lies the problem, according to Tarro and other small-business owners. The extra $300-a-week federal unemployment bonus has made not working more appealing than getting a weekly paycheck.
“It’s to the point where it’s so prevalent that people are straight-up telling employers that’s why they don’t want to work,” said Rick Simone, head of the Federal Hill Commerce Association.
Simone estimated that there are about 300 positions available at about 40 businesses on Federal Hill, many of which have gone unfilled for months. It’s not just busboys and servers; management and “back-of-house” line cook and chef jobs are hard to fill, according to Tarro.
‘People may not feel the risk is worth the reward.’
EDINALDO TEBALDI, Bryant University economics professor
A trained chef himself, Tarro acknowledged that the life of a cook – long, stressful hours on your feet – made it hard to find qualified staff even before COVID-19.
Competition among the increasing number of restaurants, hotels and tourism businesses dependent on these workers doesn’t help either, said Casey Riley, chief operating officer for Newport Restaurant Group.
But what was already a challenge has become an insurmountable obstacle.
“We’ve had ads placed for almost two months looking for 52 cooks, and we are still looking for 52 cooks,” he said. “That’s not normal.”
The hospitality industry may be particularly vulnerable because it has to add both seasonal workers and backfill the many people laid off during the last year. But hiring woes can be found across all types of business. More than 40% of National Federation of Independent Business members surveyed in March said they had job openings they couldn’t fill.
The Greysmith Cos., a Providence staffing agency, has seen a similar 20% decline in applications for its positions, said Briana Iannelli, the company’s director of performance operations.
A major contributor is the attitude of potential candidates has changed.
“The perception with job seekers is that remote jobs are abundant and [they] should be able to get one,” Iannelli said.
But that perception is not necessarily reality – only about 10% of the jobs Greysmith hires for in professional services, health care and customer service industries allow for telecommuting. Faced with applicant shortages, they are encouraging employer clients to consider a hybrid work model.
Those aren’t options in a restaurant. But restaurant owners are offering their own incentives. Newport Restaurant Group is giving an extra $125 weekly throughout the summer to back-of-house workers who are hired before June 1.
Tarro is also offering a one-time signing bonus, as well as a $250 gift card to anyone who refers a candidate who then gets hired.
Meanwhile, state lawmakers are considering how to rework unemployment benefits. A bill introduced April 16 by Rep. Carol McEntee, D-South Kingstown, would increase the amount people can earn working part time and still collect partial unemployment benefits.
Matthew Weldon, DLT director, was optimistic this would “flip the disincentive” while also lessening the amount of unemployment benefits the state is paying out. Only about 10% of the 68,000 people collecting unemployment in April were working any hours at all; incentivizing just 2,600 more people to go from full to partial unemployment would pay for itself, he said.
The state is also looking to restart its pre-COVID-19 policies requiring unemployment recipients to actively look for work, Weldon said.
While this may help with temporary staffing shortages, it won’t solve the long-term labor market changes, including the 20,000 Rhode Islanders who dropped out of the workforce over the last year, said Edinaldo Tebaldi, an economics professor at Bryant University. Low wages will also pose problems if employers don’t increase their hourly pay, Tebaldi warned.
“Especially given the higher risk of these jobs now, people may not feel the risk is worth the reward,” he said.
Tarro said his company is considering offering benefits such as dental and vision coverage and wholesale club memberships.
“It has made us look inward,” he said.
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.