The state of the economy at the street level

[JohnDe]

Anyone looking for a job with good pay -

.....veteran publican Arthur Laundy said the lack of hospitality staff was the worst he had seen in more than 60 years in an industry where he had built up a portfolio of pubs, resorts and hotels on the eastern seaboard with a focus on NSW.​

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“I have never seen anything like this in my life,” he said.​

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“Recruiting agencies are ringing hotels offering staff 10 per cent pay increases, they are poaching staff, it’s a fiasco, I have never seen anything like this.’’​

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Mr Laundy just forked out $43,000 to an agency to bring in nine chefs from Nepal and the Pacific Islands to help staff his growing empire.​

Pub owners say labour shortages are hitting the booming sector

Justin Hemmes’ behemoth hospitality empire has revealed trading has collapsed 20 per cent given his pubs are short 1000 staff, while another billionaire publican, Arthur Laundy, who has operated in the industry for more than 60 years, says staff shortages have never been this bad.

Yet both Hemmes, owner of the Merivale Group of 140 pubs, restaurants and hotels, and Laundy, who owns 80 hotels, pubs and restaurants on the eastern seaboard, are yet to resort to the actions of their American hospitality colleagues who were last week so desperate for staff they were offering $US1000 sign-on bonuses for workers willing to sell sushi, suntan cream and sarongs.

The Hawaiian-owned and operated ABC chain store franchises just across from Waikiki beach are also offering sales staff a hefty $US19 an hour which is at least $US3 an hour above the usual American pay rate for similar sales jobs.

Further out, on the Hawaiian island of Kauai, hotel managers report younger islanders do not want to work making it tough to staff the so-called Garden Island’s bigger resorts particularly its large-scale Marriott hotels which have hundreds of rooms.

At home, the situation is possibly worse for pub titan Justin Hemmes and his Merivale operation’s up-market restaurants, pubs and bars as well as two stadiums which are short almost 1000 staff, forcing multiple venues to open restaurants, pubs and bars on reduced hours.

“We are completely undercooked across the entire industry,” said Frank Robert’s Merivale’s group operations manager, who added that some of their venues were opening for five days a week instead of seven days because of the chronic shortage of staff.

Roberts estimated staff across the group were at least 25 per cent down on the usual 4500 Merivale employed with trading off 20 per cent as a result.

“It’s affecting us enormously in catering for the Sydney Cricket Ground for instance,” he said. “We have a chronic shortage of chefs, line level cooks, chef de parties, and a severe lack of hospitality staff, as well as sommeliers and professional waiters. We also have a lack of bartenders and a shortage of people entering the industry. We are stretched everywhere. As a consequence our trading is 20 per cent off … and at such a fantastic time. We have never had such a fantastic time of people wanting to come to our venues.”

Mr Roberts said he hoped the federal Labor government understood the golden egg which is hospitality should not be taken for granted. “If you want to succeed you need customers and people to serve them,” he said. “We need varying degrees of skilled migrants to help us get there or we will linger in a post pandemic state for years.”

Merivale was recruiting in many countries and interviewing and trialling 55 chefs from all parts of the world. Mr Roberts said full time waiters and bar staff were paid $60,000 a year plus tips and chefs earn above award rates.

Pub competitor and veteran publican Arthur Laundy said the lack of hospitality staff was the worst he had seen in more than 60 years in an industry where he had built up a portfolio of pubs, resorts and hotels on the eastern seaboard with a focus on NSW.

“I have never seen anything like this in my life,” he said.

“Recruiting agencies are ringing hotels offering staff 10 per cent pay increases, they are poaching staff, it’s a fiasco, I have never seen anything like this.’’

Mr Laundy just forked out $43,000 to an agency to bring in nine chefs from Nepal and the Pacific Islands to help staff his growing empire.

At his The Log Cabin Hotel in Penrith in Sydney’s outer west, which he said had gone off like a “rocket” since its recent opening, he had to teach 50-60 new staff how to pull a beer.

“You can’t do that in an hour,” he said. “We have 200 staff out there, and we could do with another 100 staff,” he told The Australian, adding that it was only recently that he was able to open the hotel’s fine dining second floor restaurant because he now had sufficient staff.

Mr Laundy will start opening his newly revamped Woolloomooloo Bay Hotel on the edge of the city this week, but this hotel has also been beset by a lack of staff. But it is not just finding waiters, bar staff and baristas that had caused headaches for the Laundy Hotel Group.

Mr Laundy said he was looking for managers for at least five of his prime Sydney city hotels including the Woolwich Pier Hotel in Sydney’s Woolwich, the Oxford Hotel in Drummoyne, the Crossways Hotel at Enfield and the Marsden Brewhouse at Marsden Park in Sydney’s outer west. He said some Sydney publicans had resorted to paying large sign-on bonuses to hospitality staff but that was something he would not do.

Both pub tycoons are likely to find a way through the staff shortages and have not paused on the growth of their property portfolios.

Hemmes this month made a dramatic play for a new site in the Sydney CBD, which could one day be transformed into a super complex to rival his landmark Ivy party palace.

The billionaire quietly picked up the Kings Green development site for about $200m, where plans for a $1.8bn office skyscraper have been scrapped and plans are afoot for one of his trademark high-end bar and restaurant precincts.

Merivale will push ahead with those plans and the Laundy family, whose acquisitions have included the Bayview Hotel on the NSW Central Coast and the Mercure at Port Macquarie, would also keep buying.

But publicans without their heft and capacity to offer careers and advancement across multiple venues could find themselves on the outer.

LISA ALLEN ASSOCIATE EDITOR & EDITOR, MANSION AUSTRALIA

 

[divs4ever]

nope , am on a disability pension now

and even with a 10% rate hike i wouldn't be lured into that industry , again , there are better jobs at reasonable hours elsewhere

the industry crippled itself in the 1980's.

 

[JohnDe]

nope , am on a disability pension now

and even with a 10% rate hike i wouldn't be lured into that industry , again , there are better jobs at reasonable hours elsewhere

the industry crippled itself in the 1980's.

There's always something better, but not a bad gig for others "full time waiters and bar staff were paid $60,000 a year plus tips and chefs earn above award rates"

 

[againsthegrain]

I guess if it was great pay there wouldn't be a shortage, maybe 60k is not good considered with today's cost of life and inflation

 

[JohnDe]

I guess if it was great pay there wouldn't be a shortage, maybe 60k is not good considered with today's cost of life and inflation

That could be the problem; people thinking that the pay is too low, so they stay longer at University or wait at home until the right job comes.

Then again, it could be that there is just not enough people to fill positions. Maybe due to the slow return of overseas Uni students and back packers that would normally fill a lot of those roles.

I wonder how many consumers will be willing to pay $55 each for a pub schnitzel meal and $11 for a standard beer, so that staff can get paid $75,000+ per year?

“Recruiting agencies are ringing hotels offering staff 10 per cent pay increases, they are poaching staff, it’s a fiasco, I have never seen anything like this.’’​

 

[againsthegrain]

That could be the problem; people thinking that the pay is too low, so they stay longer at University or wait at home until the right job comes.

Then again, it could be that there is just not enough people to fill positions. Maybe due to the slow return of overseas Uni students and back packers that would normally fill a lot of those roles.

I wonder how many consumers will be willing to pay $55 each for a pub schnitzel meal and $11 for a standard beer, so that staff can get paid $75,000+ per year?

“Recruiting agencies are ringing hotels offering staff 10 per cent pay increases, they are poaching staff, it’s a fiasco, I have never seen anything like this.’’​

Think the problem with this is, if your a business and you rely on os underpaid backpackers for labour your doing something wrong.

Of course consumers wouldn't be willing to pay 55bux for a frozen snitchell, the natural market forces would take care of that. Somebody would find a way to pay local staff more, pay themselves less and charge the consumer just right.

 

[JohnDe]

Think the problem with this is, if your a business and you rely on os underpaid backpackers for labour your doing something wrong.

Of course consumers wouldn't be willing to pay 55bux for a frozen snitchell, the natural market forces would take care of that. Somebody would find a way to pay local staff more, pay themselves less and charge the consumer just right.

that could also be the case. However, if we looked deeper we might find that there has not been enough staff from our own citizenry because of the first world problem of low birth rates. the same reason that Robert Menzies opened up the country to overseas workers with cheap transport, accommodation and less paperwork.

You and your friends may be willing to pay $55 for a schnity, I know many that will not or can not. Which brings another problem - a pub with highly paid staff, high prices to cover all the overheads and make a profit, but not enough customers able to pay.

Viscous circle, that usually only a business owner can understand.

 

[sptrawler]

Think the problem with this is, if your a business and you rely on os underpaid backpackers for labour your doing something wrong.

Of course consumers wouldn't be willing to pay 55bux for a frozen snitchell, the natural market forces would take care of that. Somebody would find a way to pay local staff more, pay themselves less and charge the consumer just right.

Tradies over here in W.A seem to be working on $1,000 per day, when they quote on jobs.
I'm on the council of owners in a block of units, someone planted a shrub next to the fence and it broke four rows of bricks and pushed the fence on a lean, the quotes to remove and replace the bricks and straighten the fence ranged from $20k down to $2,400.

 

[againsthegrain]

that could also be the case. However, if we looked deeper we might find that there has not been enough staff from our own citizenry because of the first world problem of low birth rates. the same reason that Robert Menzies opened up the country to overseas workers with cheap transport, accommodation and less paperwork.

You and your friends may be willing to pay $55 for a schnity, I know many that will not or can not. Which brings another problem - a pub with highly paid staff, high prices to cover all the overheads and make a profit, but not enough customers able to pay.

Viscous circle, that usually only a business owner can understand.

Can't argue with that, all valid points.
However know from personal experience there is 2 types of business owners:
1. Thinks owning a business is guaranteed profits and takes care of itself with minimal input.
2. Somebody that is willing to work 50+ hours on the floor if needed and make it happen.

I know which of the 2 will survive.

p.s I only pay 55 for a snitchell when backed into a corner by my wife and have no choice, otherwise I prefer home cooked food.

 

[againsthegrain]

Tradies over here in W.A seem to be working on $1,000 per day, when they quote on jobs.
I'm on the council of owners in a block of units, someone planted a shrub next to the fence and it broke four rows of bricks and pushed the fence on a lean, the quotes to remove and replace the bricks and straighten the fence ranged from $20k down to $2,400.

Yeah that's what I mean, when you put 1 dirty job next to another. Well maybe not dirty but physical id much rather be a tradie then a waiter. Personally I think hospitality is just as physically demanding if not more then tradies.
Another thing to note is, if your a Tradie and do a sht job as you said its basically arghh bad luck mate.. maybe somebody will come back next week.
If your a waiter and u spill a double mocka soy cappuccino.. your fried

 

[moXJO]

Tradies over here in W.A seem to be working on $1,000 per day, when they quote on jobs.
I'm on the council of owners in a block of units, someone planted a shrub next to the fence and it broke four rows of bricks and pushed the fence on a lean, the quotes to remove and replace the bricks and straighten the fence ranged from $20k down to $2,400.

The high quotes are the guys that don't want it. Unless you accept their "lotto win" quote.
Everyone is time stretched and its costing. Material is probably up 200% from 2019.

 

[moXJO]

Bunnings gas been very quiet and timber is back. I'm assuming that building is slowing.

 

[Dona Ferentes]

The other factor in the mix, now the economy is kick-starting again:

“There are 500,000 fewer temporary migrants and half as many international students in Australia now, compared with 2019”​

- Ross McEwan, CEO, National Australia Bank Ltd​

CEO Insights - ​

 

[Smurf1976]

Which brings another problem - a pub with highly paid staff, high prices to cover all the overheads and make a profit, but not enough customers able to pay.

A problem that applies to many industries but which seems to be missed by most of the public.

Live entertainment is one example. Charge too much and it simply leads to fewer tickets being sold. There's a limit to how much revenue a show can earn due to that aspect of it. Plus the added problem that a half full venue looks bad for everyone.

Energy industry much the same. Put the price up and manufacturing closes permanently.

Lots more like that where higher costs simply can't be passed through without killing the whole thing.

 

[moXJO]

Bunnings gas been very quiet and timber is back. I'm assuming that building is slowing.

Gas=has

 

[wayneL]

The high quotes are the guys that don't want it. Unless you accept their "lotto win" quote.
Everyone is time stretched and its costing. Material is probably up 200% from 2019.

It's like when someone rings up with a Clydesdale... It's 2 1/2 times a normal riding horse because nobody wants to do them.

 

[frugal.rock]

We used to eat out once or twice a week before the government's enacted social controls.

Now, not so much.
Prices are restrictive, and, well, we just don't get out like that as much anymore.

I remember about 5 years ago, the cuts to retail staff (amongst others) overtime and penalty pay rates in NSW.
The industry made their own bed quite some time ago by accepting and pushing for it.

 

[moXJO]

Cheap sht goods seem to be back in stock in kmart. Namely the fitness equipment. Bunnings seems to be stocked. So maybe the flow of cheap goods is easing.

However, popular goods are still a pain to get. Electronics etc isn't easy to find.

Woolies stores seem to be struggling to keep shelves stacked. Toilet paper has disappeared again as well.
Coles seem to be better stocked.

 

[JohnDe]

No stock issues at my locals, near work & home.

Yesterday I went to Costco and all the shelves were full, so was the carpark, the place was overflowing. Did the bulk of my shopping food shopping there, good savings.

After lunch went to my local green grocer and picked up a bunch of vegetables. Stuck to the cheaper stuff - broccoli, spinach, eggplants, and so on. Green string beans (my favourite) I left behind at $33/kg. Lettuce was $6.99 each.

Which Woolies have empty shelves?

 

[dyna]

Saw a $2.99 lettuce, but I'm too cheap to pay, even that much.
Got a marked down cabbage for 60 cents, instead . ( It was $12 )

Jeebus. Who in their right mind pays 12 bucks for a freakin' cabbage?