Kiosks killing restaurant jobs? Don’t let the doomsayers distract you
Doomsday prophecies about kiosks destroying restaurant jobs aren't going away any time soon. On Monday, CBS News carried a headline: "Could fast-food's high-tech future hurt jobs?"
The headline was obviously designed to stoke fears that restaurant workers will be losing their jobs to automation. The article itself offered no evidence to support this possibility. In fact, the one restaurant employee quoted in the story expressed no worries about her job.
But consumer media outlets don't always want to let facts get in the way of a catchy headline.
It wasn't the first such doomsday prophesy, and it won't be the last.
When McDonald's announced plans earlier this summer to introduce self-order kiosks as part of its "Experience of the Future," several media outlets — CNBC, newsmax, zerohedge, infowars and others — claimed the company was replacing cashiers with kiosks, despite the fact that McDonald's never made such a statement.
In fact, McDonald's has said on many occasions that kiosks are not a labor replacement, but instead, allow the company to transition back-of-the-house roles to more customer service-oriented roles such as concierge and table service.
The restaurant industry needs to be prepared for more of these alarmist reports as kiosks continue to expand. It will take time for many lazy journalists to start paying attention to the facts.
While a definitive study has not been conducted on the impact of kiosks on restaurant jobs, there is plenty of anecdotal evidence suggesting that if anything, kiosks are adding jobs.
By allowing customers to be served faster and with greater order accuracy, kiosks are helping restaurants serve more customers, increasing the number of customers, and requiring more employees.
James Wehner, McDonald's director of global digital experience, told Kiosk Marketplace in June that as a rule, staffing levels don't change as the employees are reallocated within the store to serve customers better and support new propositions such as table service. McDonald's has tens of thousands of self-order kiosks in restaurants globally.
Two days ago, Kiosk Marketplace reported that a Roly Poly Sandwiches franchisee in Birmingham, Alabama, has added a position since introducing self-order kiosks because of new business.
What's the real challenge?
The real challenge facing the restaurant industry is finding enough workers to fill jobs. The number of restaurant industry jobs is projected to grow from 14.7 million in 2017 to 16.3 million in 2027, according to the National Restaurant Association.
From the beginning of the nation's employment recovery in March 2010 through February 2017, the number of restaurant jobs in the U.S. has jumped 25 percent, according to data from the Bureau of Labor Statistics. This was more than double the 12 percent gain in total U.S. jobs during the same period.
Kiosk deployments could actually exacerbate the need for more workers, given the positive impact kiosks have had to date on restaurant sales.
Automation's impact on employment in general is a complex topic that experts have been examining for years. Automation is causing some jobs to disappear and creating the need for new ones that oftentimes require new skills.
Consider ATMs and teller positions
David Autor, an economist at the Massachusetts Institute of Technology Sloan School of Business, reviewed the impact of ATMs on bank teller jobs in a 2015 article in the Journal of Economic Perspectives titled, "Why Are There Still So Many Jobs? The History and Future of Workplace Automation."
The number of ATMs in the U.S. quadrupled from approximately 100,000 in 1970 to 400,000 between 1995 and 2010, Autor noted. Bank teller employment actually rose from 500,000 to approximately 550,000 over the 30-year period from 1980 to 2010.
By reducing the cost of operating a bank branch, ATMs actually increased the demand for tellers. While the number of tellers per branch fell by more than a third between 1988 and 2004, the number of urban bank branches increased by more than 40 percent.
Secondly, as ATMs assumed more of the routine tasks of bank tellers, information technology enabled a broader range of bank personnel to become involved in "relationship banking."
Banks recognized the value of tellers enabled by information technology, not as checkout clerks, but as salespersons, improving relationships with customers and introducing them to other bank services like credit cards, loans and investment products.
The restaurant industry is in the initial stages of introducing kiosks. As deployments increase, be prepared for media outlets to continue to sound their doomsday alarms about job losses.
The restaurant industry has to stay focused on addressing the challenges technology brings, namely the need for employees adept at working with technology as well as the possible need for more employees.
In time, the consumer media will get tired of pursuing a story that isn't a story. But the restaurant industry cannot afford to be distracted from the challenges that lay ahead.
Elliot Maras is the editor of KioskMarketplace.com and FoodTruckOperator.com.