Cocktail prices in Australia are predicted to rise by as much as 20% this summer due to the increasing cost of goods and the chronic hospitality staffing shortage.
Restaurant and Catering Industry Association chief executive Wes Lambert told ABC News: “Consumers will need to prepare their wallets for increased menu prices into 2022. It certainly is a continued COVID hangover for the industry.”
The Restaurant and Catering Industry Association estimates there are about 100,000 jobs that are currently vacant in the hospitality sector. And wages are up to 15% more because staff are in such short supply. Some venues are paying staff between $40-50 an hour for jobs that normally attract a $30 an hour rate.
Lambert said the sector must be prioritised by the government when skilled workers are allowed to enter the country.
“We need to get the tourism and hospitality industry fast tracked with special purpose visas … to get us up to a level of workforce so that we can be productive in 2022,” he said.
“We can’t just rely on Australians to fill these positions because the entire system was designed for a seasonal migrant workforce.
“We immediately need 100,000 tourism and hospitality workforce visas to get people back into Australia as a priority or the industry cannot fully recover.”
Lambert said that while the government was trying to upskill Australians, it’s not enough to help the current problem.
“Getting Australians skilled up and trained up is not an overnight activity,” he said. “High-level kitchen and front-of-house assistant managers and executive chefs, that takes years and years and years of experience. I’m hoping that once the borders open up we can get more people on the front of house and cooking in our kitchens.”
Roy McCullagh (above), CEO of hospitality recruitment agency Skills Connect International, said that staff shortages faced by the hospitality industry have created an unenviable situation for operators. The bargaining and negotiating power is now largely in the hands of the candidates, who have a greater choice of roles and are competing in a smaller applicant pool.
“”While the various government agencies at State and Federal level have been working hard to address the situation, the continued uncertainty as to when the international borders will re-open to international students continues to be a major concern for our industry,” he said.
“We have had hospitality venues close intermittently since the lockdown lifted, in order to give their overworked staff a day off. When you have Executive Chefs washing pots, you know you have an issue.”
Skills Connect is partnering with several off-shore student providers that are planning to get qualified staff into Australia when the borders reopen. McCullagh has been doing Zoom interviews with candidates in South East Asia and has 200 or 300 workers lined up ready to go.
“However, at this stage we can’t sponsor international candidates due to the lack of clarity,” he said.
Drinks companies raise prices to cover costs
Surging costs for logistics and raw materials including glass, alcohol and sugar also mean many suppliers will be raising their prices.
Campari, for example, announced last month that it plans bigger than usual increases in drinks prices next year.
“We normally raise prices every year… in 2022 we plan to have more robust increases than usual, given higher costs on all raw materials,” said CEO Bob Kunze-Concewitz told Reuters.
Campari will raise prices in all its main markets and speciality beverages such as Aperol and Campari could see higher increases than drinks that are more exposed to competition, such as vodka.
“We have increased tequila prices twice in 18 months, and we will have to do it again in 2022,” he added.