An analyst estimates the labor shortage is keeping McDonald’s sales down by 3 to 4% from where they would be if stores had enough workers

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  • A lack of workers is keeping McDonald's sales down, one analyst says.
  • The restaurant industry is in crisis as some businesses close dining rooms without enough workers.
  • Workers didn't return after expanded benefits ended.

McDonald's sales are up over pre-pandemic levels, but a lack of workers is still keeping them down, according to a new analysis from Kalinowski Equity Research.

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"We believe that labor availability issues are currently hampering McDonald's US same-store sales by three to four percentage points," the report, which was viewed by Insider, said.

McDonald's declined to comment when reached by Insider, but in an earnings call in July, the company acknowledged staffing issues as a major hurdle. CEO Chris Kempczkinski called it a "challenging staffing environment," but said it was improving.

Staffing conditions may not have gotten much better in the meantime, though. Expanded unemployment benefits have lapsed across the country, but workers didn't rush back to service industry jobs the way some experts predicted.

Instead, any restaurants have been forced to close dining rooms, cut hours, or take other measures to function with low staffing. According to a survey from the National Restaurant Association (NRA), 75% of restaurant operators agreed that finding staff was their biggest challenge right now. Of owners surveyed, 78% said that didn't have enough workers to handle business, which led to many closing dining rooms or seating areas to lower the number of customers they could serve. Over half of fast-food restaurant operators said that they decided to shut parts of dining rooms in August because they didn't have the workers to serve those areas.

Anonymous franchise owners responding to the Kalinowski survey echoed the same worries. The "employee shortage continues and puts extreme strain on our existing employees, as well as not being able to deliver the service we need to and that our customers still expect," one franchisee said in response to a question about what conditions led to current sales. "Having dining rooms open makes the labor shortage worse," another said.

Now, customers are seeing the results of those problems surface across the country. Three Chick-fil-A restaurants in Alabama had to close their dining rooms over lack of staff, though they continued to make food for delivery.

"We, along with many businesses, are in the middle of a hiring crisis," the Calera, Alabama Chick-fil-A restaurant said in a Facebook post. A McDonald's location in North Carolina made a similar move, closing the dining room while keeping the drive-thru running.

"Our nation's restaurant recovery is officially moving in reverse," executive vice president of the NRA, Sean Kennedy, said in a statement.

Do you have a story to share about a retail or restaurant chain? Email this reporter at [email protected]

Read the original article on Business Insider

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