Fast-food chains are trying to convince loyal customers to work for them by offering free food and discounts during the labor shortage

Applebee's provided free appetizers for all who attended interviews on its May national hiring day. Hollis Johnson/Business Insider
An Outmatch executive stated that some fast-food restaurants are trying to convert customers to staff.

Kelly Ann McGrath stated that in the midst of a labor shortage, they offer free food to potential employees.

Applebee's offered applicants free appetizers during its national hiring day.

Check out more stories from Insider's business page.

A hiring executive stated that fast-food chains and other companies offer free food and discounts in order to recruit workers during the labor shortage.

Kelly Ann McGrath (VP of Client Success at Outmatch), told Insider that many of their restaurant clients have been passively recruiting to existing customers.

McGrath declined specific examples. Fast-casual restaurant chain Applebee's offered complimentary appetizers to all applicants to its May national hiring day, which was designed to fill 10,000 positions.

Continue reading: Grubhub's first-mover advantage is lost by experts - and what the future holds for this once-dominant delivery company in restaurant services

These perks are not limited to fast-food restaurants.

New employees at Omni Hotels and Resorts get three nights free in a hotel of their choosing. One hotel in Washington State is offering staff $15 worth of bar credits per day so that they can enjoy a free meal at the restaurant during and after work. Staff also get a discount at the restaurant outside of work hours.

McGrath stated that offering additional discounts, gift cards, or products in place of sign-on bonuses is a great way to attract current customers.

This was an economical way to recruit staff. It could also reduce the training time required because they are already familiar with the brand. She also said that their brand loyalty could result in employee retention. This is something restaurants cannot afford to lose in such a competitive labor market.

Continue the story

Restaurants have a hard time finding labor

In the current labor shortage, many restaurants like McDonald's, Chipotle and Starbucks have raised wages to attract employees. McGrath pointed out that this was mostly at larger companies.

As they try to find workers, some offer other benefits such as free tuition and sign-on bonuses.

McGrath stated that all companies are competing for the same talent.

Iowa pizza franchisee even claimed that he is asking his general managers for help in poaching workers from other restaurants. He said that "everything is fair play" in the labor scramble.

Restaurants are having to reduce their hours and increase prices due to the labor shortage. Insider was told by a Maine restaurant owner that she had to close her restaurant one hour earlier every day due to ingredient shortages. A New Jersey pizzeria owner stated that he had to increase the price of chicken wings by more that 50%.

McGrath stated that many of their clients are struggling in general. He also said that it was easier for them to find new staff members.

Insider was told by Kevin Harrington, CEO of Joblist, that the tight labor market was primarily caused by people quitting entry-level, hourly paid, customer-facing jobs. This resulted in the hospitality industry being particularly hard hit.

M Culinary Concepts, the largest Southwest catering company, said to Insider that it is finding it difficult to find staff for weddings, parties and business events.

M Culinary has over 1,000 employees, with hundreds of seasonal workers. However, it stated that M Culinary was having difficulty finding enough drivers, cooks and warehouse workers to support its events.

Business Insider has the original article.