F&B players in Singapore offer salary jumps, joining bonuses to fight severe labour crunch
FOOD and beverage (F&B) operators are wooing local hires with higher starting salaries, four-figure joining bonuses and other benefits amid an acute labour crunch, while raising pay to keep existing staff from being poached.
From hawker centres to restaurant chains, some starting salaries have risen more than a fifth in recent months. Min jiang kueh (traditional pancake) chain Munchi Pancakes is offering S$2,669 for stall assistants at its two hawker centre outlets, with additional overtime pay of S$14 per hour. Weekly working hours have been cut to 44 hours from 54 hours previously.
Before June, the same position paid S$2,200 including fixed overtime. From November, the chain will also provide corporate insurance for its employees.
“There is a sense of disbelief,” said Munchi Pancakes director Calvyn Ng, who also runs two other F&B outlets. “Interested people who call us up ask a lot of questions, like whether there’s a trick to (the offer).”
Similarly, fast casual Mexican chain Stuff’d has raised salaries by an average of 25-35 per cent since July, for both new and existing staff, said head of operations Matthew K George.
Crew members get S$2,400 a month, up from S$1,800 previously; supervisor pay is now S$2,600, up from S$2,200. An outlet manager can command up to S$3,000, from S$2,500 before; an area manager, up to S$4,500, from S$3,200 before. Such increments have also been applied at Ordinary Burgers and Hugabo, two other quick-service restaurant (QSR) brands George oversees.
Stuff’d was “forced” to review its salaries to match higher market rates and prevent their staff from being poached by competitors, said George. “We were not getting applications and the manpower shortage was severe. Even if your business is good, with a manpower crunch, you cannot expand.”
Stuff’d has also doubled its “welcome bonus” – a one-off payout for new hires – to S$2,000.
On job portal Fastjobs, such joining bonuses for hospitality and F&B positions range mostly from S$500 to S$3,600, with a top-end outlier being the S$5,000 bonus offered by in-flight caterer and ground handler Sats for Singaporeans in kitchen roles. Meanwhile, a recruitment flyer from bubble tea chain LiHo Tea touts a joining bonus of S$1,200.
Then there is the “rehiring” bonus of S$500 introduced in June by Japanese restaurant group RE&S Holdings, for ex-employees who return. The group, which operates dining concepts such as Ichiban Boshi, also raised its salaries for full-time F&B staff – including existing hires – by about 5 per cent in September.
Mili Er, senior human resources manager at RE&S, said the changes aim to “stabilise” its headcount. Since the changes kicked in, the staff attrition rate for its F&B outlets has fallen to 4 per cent, from 6 per cent in the last six months.
F&B operators are becoming more creative in hiring and retaining workers, such as by offering referral and retention incentives, said CIMB private banking economist Song Seng Wun. “These are simple competitive tactics to hire and retain labour. You might pinch from next door, but (those) two doors down could pinch from you too.”
A spokesperson from the Restaurant Association of Singapore noted that the F&B industry has responded to the “high demand” for services sector employees by “continuing its efforts to transform and innovate for better efficiency and deployment of resources.”
This includes job redesign and offering career advancement opportunities, on top of salary increases, to attract and retain talent in the longer run. He added that wages had already increased by about 20 per cent over the last two years due to the pandemic and border closures.
Stuff’d managed to hire more than 40 new staff with its wage changes in July, but hiring has since slowed, said George. The chain employs mostly Singaporeans and still needs 40 more staff.
Ng has recruited three full-time stall assistants for his Munchi Pancakes outlets but is still short of 10 staff, including for a new stall opening at Lau Pa Sat next month.
“Response has been slow. There is still interest, but we’ve seen a lot of new joiners who do not complete their probation. Some of them quit on the first day, some of them after two weeks,” said Ng. “Basically, F&B is not for everybody.”
As Munchi Pancakes’ stalls are located in hawker centres, Ng is unable to hire foreigners.
“With a limited pool of local manpower, and an economy that has been expanding strongly after Covid-19, many employers are chasing after the same set of workers,” said Walter Theseira, associate professor of economics at the Singapore University of Social Sciences.
Without “hiring aggressively”, operators stand to lose business by being unable to maintain operating hours or service quality, and may even have to give up expansion plans, he added. “So they hire, since even paying these higher staff costs is preferable to losing revenue opportunities.”
Stuff’d has had “no choice” but to increase menu prices by about 10 per cent to cover the rising costs of labour and ingredients, said George.
Hiring incentives cannot be kept up indefinitely, said Song, adding that business owners have to be careful in managing their margins. “The moment there is an economic slowdown or recession starts to hit consumption, you will see these things trailing off.”
But he believes such hiring tactics will remain status quo for now, at least until Chinese New Year. “There will still be business owners who want and are willing to add on to their payroll, because there is money to be made.”
