Valuable Tax Credits for Hospitality Workers

Get the word out to employees and customers who could benefit from the Earned Income and the Child Tax credits, which reduce the amount of income tax workers owe. Workers who don't make enough money to owe taxes can still qualify for the credit, but they must file tax returns to claim the credits.

Earned Income Credit
The EIC is a refundable, federal income tax credit for full- and part-time workers who fall below certain income thresholds. Employers must notify employees for whom income tax was not withheld at any time during the year and are encouraged to notify employees whose wages for 2015 were less than $53,267 that he or she may be eligible. The EIC can be worth as much $6,242. Singles who raised children and earned less than $47,747, or those who are married filing jointly, raised children and earned less than $53,267, in 2015 can claim the credit, as well as singles not raising children who earned less than $14,820 last year or, for those who are married filing jointly, $20,330.

Some workers with children choose to receive part of their EIC payments in advance as part of their regular paychecks and the rest after they file their annual tax returns. Individual taxpayers who earned less than $39,131, or those married filing jointly who earned less than $44,651, with at least one qualifying child are eligible.

Child Tax Credit
The Child Tax Credit is worth up to $1,000 for each qualifying child under 17. The tax credits can help employees pay for childcare and cover other day-to-day needs. Families who earned at least $3,000 in taxable income in 2015 are eligible.

Employer assistance
The Center for Budget and Policy Priorities offers free posters, fliers and paycheck inserts for employers. Color posters are available in English and Spanish, and fliers are available in 21 languages. Get more information at 202-408-1080. Download thematerials, and get tips to promote the tax credits.

The Internal Revenue Service also offers an employer toolkit with outreach tips, posters, payroll stuffers, and social media tools. 

Free tax help
The IRS offers free electronic filing and assistance through the Volunteer Income Tax Assistance Program, a partnership with community-based organizations. Workers who earned less than $54,000 in 2015 are eligible, as well as people with limited English-language skills, people with disabilities and the elderly. Taxpayers can call 800-906-9887 to find a VITA site near them. The IRS helpline at 800-829-1040 is set up to answer taxpayer calls about credits or other tax issues. 

(via National Restaurant Association)

5 Reasons The Restaurant Industry Is In Good Shape

The restaurant industry started the year off weak, at least based on sales indices. Black Box Intelligence said same-store sales fell 0.8 percent for the month. According to MillerPulse, same-store sales increased 1 percent. Both were the weakest figures in years.

But both numbers mask what was, in reality, a good month for the industry and what could be the start of a profitable year. Here’s why:

The two-year trend is still strong. Both MillerPulse and Black Box were comparing themselves to a January 2015 that was the strongest month in recent years thanks to a run of stupid good weather. So sure, January’s sales weren’t quite as good as the previous year, they were still quite good on a two-year basis. MillerPulse’s two-year same-store sales trend of 6.3 percent was the strongest for that index in two years. For Black Box, the two-year trend is 5.3 percent. Two-year trend numbers factor out one-time events like weather that can influence a single year’s same-store sales.

Overall sales were stronger. According to recent federal data, sales at food services and drinking places increased 6.1 percent in January, to $53.5 billion. Federal data tracks all sales, rather than same-store sales, and so it can account for increases in sales from new units as well as independents. Overall retail sales excluding auto sales, by comparison, increased just 2.5 percent. Sales at grocery stores, 2.3 percent.

Restaurant owners are hiring. This is the best indication of an industry still in expansion mode. Restaurateurs hired 46,700 workers in January, or close to one out of every three jobs the economy created in the month. Over the past year, the industry has added more than 380,000 jobs. What’s the point of adding workers if you don’t think your business will need the added labor?

Gas prices are still ridiculously low. Gas prices averaged $1.70 per gallon as of Tuesday, according to AAA. While that’s a bit higher than it was a week ago, it’s still 60 cents per gallon cheaper than a year ago. Gas prices are expected to be low for some time, as long as there remains a glut in oil, putting money in the pockets of more consumers. When consumers get more money, they really want to spend it on dining out.

Food costs are coming down. These additional sales are coming as beef costs finally join other commodities in deflating. Lower prices for beef, pork and chicken should make for a more profitable industry in 2016. Indeed, Texas Roadhouse executives said on the company’s earnings call Monday that they expect higher margins this year thanks to more sales and lower food costs.

None of this is to say that there aren’t challenges in the industry. But barring some major calamity, it appears this could be the best year for restaurants since the start of the Great Recession.

(via Nation's Restaurant News)

5 Ways the Restaurant Workforce is Changing

#1: Driving middle class job growth

The restaurant industry was a driving force behind the nation’s recovery from the Great Recession. Not only are restaurants leaders in total job growth, they’re also adding middle class jobs at a stronger rate than the overall economy. During the Great Recession, that rate was four times more than the overall economy.

#2: Turnover creeps up

The bad news: Restaurant turnover is trending up. The good news: Current turnover is relatively low, compared to record highs before the economic downturn.

#3: Recruiting challenges

The competition for employees intensifies as the economy improves. More than one in four operators say they have difficult-to-fill job openings. The biggest challenge? Finding applicants for back-of-the-house.

#4: Diverse opportunities

Restaurants provide unparalleled opportunities for people of all backgrounds to own their own businesses. The number of women-owned restaurant businesses is growing at a faster rate than the overall economy, as is the number of Hispanic-, African-American-, and Asian-owned operations.

#5: There’s money in the banana stand. And jobs, apparently.

Coffee, doughnut and ice cream shops are fueling more than commuters and snack attacks. The snack-and-nonalcoholic-beverage-bar segment is had the industry's highest job growth last year.

(via National Restaurant Association)

2016 Restaurant Industry Challenges Continue

The National Restaurant Association projects that restaurants in 2016 will post sales of $782.7 billion and employ 14.4 million people in more than 1 million locations. Released today, the 2016 Restaurant Industry Forecast reveals that the U.S. restaurant industry will remain the nation’s second-largest private sector employer, providing career opportunities for 1in 10 working Americans.

“Though the overall economy is trending in the right direction, the operating environment isn’t without challenges going into 2016,” said Hudson Riehle, Senior Vice President of Research for the National Restaurant Association. “With overall tightening in some labor markets, we’re seeing recruitment and retention making a comeback as a top challenge for restaurant operators.”

Top restaurant industry trends for 2016 include:

• Not all smooth sailing. Restaurant operators will face a number of headwinds in the 2016 business environment. From legislative and regulatory pressures and moderate economic growth, to labor cost increases and cybersecurity, both new and old issues will challenge profit margins and muddle operating procedures.
• Labor pool is getting shallower. Recruitment and retention of employees will re-emerge as a top challenge for restaurant operators, as a tighter national labor market means greater competition with other industries for employees. Workforce demographics are shifting to include a greater proportion of older workers while the younger labor pool is shrinking.
• Everybody’s business. The restaurant industry has always been one where people from all backgrounds have the opportunity to achieve the American dream of owning one’s own business. The restaurant industry is home to a growing number of women-owned and minority-owned businesses, where many current owners started their restaurant careers at entry level. Eating-and-drinking-place firms owned by women and minorities continue to grow at a faster rate than the overall industry.
• Moderate sales growth. The restaurant industry will see its seventh consecutive year of real sales growth in 2016. Substantial regional variations will continue, reflecting local business conditions. The long-term trend of quickservice sales growth outpacing tableservice sales growth will also maintain its momentum, along with strong growth of snack and nonalcoholic beverage bars.
• Technology growing pains. The availability of technology options is starting to move from novelty to expectation among many consumers. In the race to be tech-forward, new systems are popping up in more places as guests say they want to use them. However, two in five consumers say that technology makes restaurant visits and ordering more complicated, indicating that perhaps not all these new systems are as user-friendly as they could be. Restaurants will be focusing on closing that divide in the year ahead.
• Mobile payment gaining acceptance. Few technologies are advancing faster than payment platforms. Security and convenience are converging in mobile payment systems, with a number of wallet apps and devices entering the market. Although a majority of consumers remain on the fence about paying for meals via smartphone, a growing number say they would use – or are already using – that option when available, and the trend is expected to keep its trajectory through 2016.
• American foodie 2.0. The typical restaurant guest today is not the same as the typical restaurant guest 20 years ago. Having essentially grown up in restaurants, younger generations have a very sophisticated world-view when it comes to food. Restaurant operators say guests have higher expectations of their dining experience and pay more attention to everything from diet-specific food, to sustainability, to food sourcing and production than even just two years ago. Operators will carefully balance how to cater to these precise tastes without becoming too niche or alienating more mature guests. 

For more information on the 2016 Restaurant Industry Forecast, including graphics and video, visit Restaurant.org/Forecast.

(via National Restaurant Association)

High Projections for Restaurant Job Growth in 2016

Restaurant job growth is projected to outpace the overall economy in 2016, and the industry will add more than 300,000 jobs for the sixth consecutive calendar year, according to the NRA’s Chief Economist Bruce Grindy. His Economist’s Notebookcommentary and analysis appears regularly on Restaurant.org and Restaurant TrendMapper.

The restaurant industry continues to be one of the strongest job creators in the economy, with industry job growth outpacing the overall economy for the 16th consecutive year in 2015. Eating and drinking places, the primary component of the restaurant industry accounting for three-fourths of the total restaurant and foodservice workforce, added jobs at a 3.2 percent rate in 2015. This was more than a full percentage point above the 2.1 percent gain in total U.S. employment.

The industry’s 2015 gain marked the fourth consecutive year with job growth of at least 3 percent, the longest streak since the mid-1980s. With job growth outstripping the overall economy in each of the last 16 years, the eating-and-drinking-place sector saw its employment level jump by 38 percent. In contrast, the total number of jobs in the economy increased by only 10 percent during the same period.

Within the industry, job growth remained broad-based in 2015, with most of the major segments posting solid gains. The snack-and-nonalcoholic-beverage-bar segment – which includes concepts like coffee, doughnut and ice cream shops – led the way with a robust 6.5 percent employment gain in 2015, the fourth consecutive year with growth above 5 percent.

The quickservice segment added jobs at a 3.4 percent rate in 2015, while the tableservice segment expanded payrolls at a 3.3 percent pace.

Looking ahead, the NRA expects eating and drinking places to add jobs at a 3.0 percent rate in 2016, which will represent the fifth consecutive year in which the restaurant industry registered job growth of at least 3 percent. In comparison, the overall economy hasn’t posted job growth of 3 percent since 1994.

The projected 2016 increase will also represent the sixth consecutive calendar year in which restaurants added more than 300,000 jobs.

For the national labor market, 2015 was the strongest year yet in the aftermath of the Great Recession. The national economy added a net 2.9 million jobs on an annual basis in 2015, and the 2.1 percent employment increase was the strongest gain in 15 years.

Although the economy is expected to build on 2015’s positive performance, growth will likely be somewhat slower in 2016. The NRA projects total U.S. employment to increase 1.8 percent in 2016, down slightly from the 2.1 percent gain posted in 2015.

(via National Restaurant Association)