Originally posted by Peachpie9
The cooks make between $15 and $25 an hour and enjoy the same hours as the other employees ... plans to begin offering benefits ... In the absence of artificial pressures, wages and prices are set by the market
As most restaurants go, that is a generous wage range for line cooks ...
While it's true, really great employees are worth their pay and are in high demand ... however the "supply and demand" you mentioned is *not* what determines wages in restaurants. Most restaurants are constrained to pay what they do to employees.
True ... a well run, highly profitable restaurant can afford to pay a generous wage to keep the best people ... but this is certainly not most restaurants.
Most restaurants (I'd say well over 90%) are run *effectively* by the seat-of-the-pants; and if they are doing well it is often because of sufficient revenue alone.
Their menus are priced by looking at other restaurants' menus. They rarely have done a complete market analysis before opening and don't keep track of trends, local development and economics, wholesale costs etc. They often do not keep track of, and use, figures year-over-year or even period-over-period ... and as well don't do analysis often enough ... which means weekly (or even intra weekly) in many cases (including a cash flow pro-forma to get themselves "off-the-ropes"). Their budgets are not formal operating budgets (budgets indexed to projected sales) and many don't do Budget Dev. Analysis. They often have trouble obtaining accurate Cost Volume Profit numbers because their operations are unstable. Their response to cash-flow problems is to cut expenses ... often variable expenses in food and beverage (jacking the menu around and sacrificing quality or quantity in their offerings), and cutting labor. You can not pay what you can not support ... and particularly for multiple people.
For those restaurants who do pay a generous wage, there are a bunch of factors that affect their ability to do so ...
Number one are issues of profitability and cash flow. I mention them separately because even without much profitability, some owners might desire the benefits of a well treated staff (less turnover, less absenteeism, higher productivity, etc) .. and decide that as long as their cash flow supports it, they will pay more generously even though it lowers their return on investment.
Fat profitability is based on some external stuff such as the economic climate in the area (I see you live in the state of Washington), competition, and whether ones restaurant sufficiently targets the right customership and having enough of them. And also internal stuff such as standards, tight internal controls, menu decisions being based on *numbers*, other solid financial controls such as operating budgets, advertising budgets, etc; and proper advertising and marketing including the restaurant's image and perceived "desirability" by the patron ... and of course, perceptions of quality and value by the patron.
The bottom line is ... you can't pay what you don't have. (or at least, you won't be doing it for long)
Originally posted by Peachpie9
A good chef can give the establishment that cachet that sets it apart and makes it a preferred destination.
Absolutely. A restaurant's image is crucial. For that reason celebrity chefs are a better example for your supply and demand example.
Also, having a renown Chef can attract apprentices at a more reasonable price. For individuals who intend to become professional chefs, the higher quality reference they get (working in a famous kitchen) ... the earlier in their careers ... the (much) greater momentum they have ascending the career ladder.