Labor shortages are nothing new in the Food & Beverage (F&B) industry, but recent years have brought unprecedented challenges. Employers struggle to fill critical roles despite high unemployment rates in other sectors, from bustling city restaurants to sprawling farmlands. What’s behind this paradox? And more importantly, what can businesses do to overcome it?

In this blog post, we’ll explore the root causes of labor shortages in F&B, their impact on the industry, and actionable solutions to help businesses thrive—even in tight labor markets.

What Labor Shortage?

Before we jump into the details, let’s clarify what we mean by “labor shortage.” Simply put, a labor shortage happens when there aren’t enough workers to fill available jobs at current wage levels and working conditions. While it might sound straightforward, the reality is far more complex.

For example, industries like F&B, Retail, and Manufacturing have reported significant worker shortages even during high unemployment. This paradox highlights deeper issues in the labor market, such as mismatched skills, demographic shifts, and outdated hiring practices.

What’s Causing the Labor Shortage in F&B?

At first glance, it seems counterintuitive: how can there be a shortage of workers when so many people are unemployed? The answer lies in several interconnected factors:

• Young Workers Are Disappearing: According to Bruce Grindy of the National Restaurant Association, the traditional base of the F&B workforce—16-to-24-year-olds—is shrinking. By 2018, this group comprised just 13% of the workforce, compared to 24% in 1978.
• Harsh Working Conditions: Long hours, low pay, and physically demanding work make F&B jobs unappealing to many Americans.
• Immigration Policies: Tight visa caps and restrictive immigration laws have cut off a vital source of labor. For example, farmers in states like Georgia and Alabama report leaving millions of dollars worth of crops unharvested because they couldn’t find enough workers.
• Seasonal Nature of Work: Many F&B jobs are temporary or seasonal, which doesn’t appeal to workers looking for stability.

These challenges aren’t isolated incidents but part of a broader trend reshaping the F&B landscape.

Read: 5 Ways Your Company Can Handle Labor Shortage

How Does Labor Shortage Affect the Economy?

Labor shortages impact individual businesses and ripple through the entire economy. When companies can’t find workers, they delay expansions, reduce operations, or even move jobs overseas. For example, Microsoft opened a software center in Vancouver because U.S. visa restrictions made it hard to hire engineers domestically.

On a broader scale, labor shortages lead to lost revenue, higher consumer prices, and slower economic growth. Industries like agriculture have already seen crops rotting in fields due to a lack of harvest workers, costing farmers millions.

Why Is There a Global Labor Shortage?

The global labor shortage isn’t unique to the U.S.—it’s happening worldwide. Factors like aging populations, declining birth rates, and rising demand for skilled workers drive this trend. Countries like Japan and Germany face similar challenges, with immigration policies failing to meet labor demands.

Additionally, remote work has created new opportunities for workers to relocate, leaving some regions struggling to attract talent. Employers now compete globally, making it harder to find and retain employees.

How Do Labor Shortages Affect the F&B Industry?

When restaurants and farms can’t find workers, everyone feels the impact:

• Restaurants Cut Hours or Close: Some operators reduce operating hours or shut down entirely due to staffing issues.
• Farmers Lose Crops: Without enough hands to harvest, fruits and vegetables rot in the fields, leading to lost revenue and higher food prices.
• Delayed Expansions: Plans for new locations or menu offerings get shelved until labor becomes available.

For example, CBS News reported in 2010 that skilled labor shortages frustrated employers across industries, including F&B. Similarly, Wisconsin and North Carolina farmers have scaled back operations because they couldn’t find enough workers.

Are We Experiencing a Labor Shortage in F&B?

Absolutely. Data from the National Restaurant Association shows that the industry plans to add 1.3 million new jobs over the next decade—but finding workers to fill those roles won’t be easy. Meanwhile, farms struggle with seasonal labor gaps, and hotels report difficulty hiring housekeeping and front-desk staff.

When Will the Labor Shortage End?

While no one knows precisely when the shortage will ease, experts suggest a combination of strategies:

• Raising wages and improving working conditions.
• Reforming immigration policies to allow more foreign workers into the country.
• Investing in training programs to build a pipeline of skilled workers.

Until then, businesses must adapt by leveraging technology, offering flexible schedules, and exploring creative recruitment tactics.

Labor Shortages FAQs

Here are answers to some common questions about labor shortages:

What is causing the labor shortage in 2025?

The labor shortage is caused by a combination of factors, including an aging workforce, skill mismatches, geographic imbalances, and outdated immigration policies. The pandemic and its aftermath have exacerbated these issues.

How do labor shortages affect small businesses?

Small businesses often feel the impact of labor shortages more acutely than larger corporations. They may struggle to compete for talent, reducing productivity, delayed projects, and lost revenue.

Can technology solve labor shortages?

Technology can help address labor shortages by automating repetitive tasks, streamlining recruitment processes, and enabling remote work. However, it’s not a silver bullet—human workers are still needed for many roles.

How can businesses attract more workers?

To attract workers, businesses should focus on offering competitive wages, flexible schedules, and opportunities for career growth. Improving workplace culture and investing in employee training can also make a big difference.

FAQs About Nimbly

If you’re wondering how Nimbly fits into this conversation, here’s what you need to know:

Read Nimbly Impact Reports

What is Nimbly?

Nimbly is a platform designed to help businesses streamline operations and improve efficiency. By automating workflows and providing real-time insights, Nimbly empowers companies to do more with fewer resources.

How can Nimbly help with labor shortages?

Nimbly reduces dependency on manual labor by automating routine tasks and optimizing workflows. This allows businesses to maintain or increase productivity despite low staffing levels.

Is Nimbly suitable for small businesses?

Absolutely! Nimbly is scalable and adaptable, making it an excellent fit for businesses of all sizes. Whether you’re a startup or an established enterprise, Nimbly can help you overcome operational challenges.