The Effect of Immigration on the Restaurant Industry

Screenshot (27)-101912-editedImmigrants are a core pillar behind the American restaurant industry. More than a fifth of the workers in this sector are foreign-born. 

And the foreign-born demographic is only growing in importance as fewer and fewer 16 to 24 year-olds are choosing to join the restaurant industry's labor force, a group which had previously represented 40% of restaurant workers. 

To help restaurant operators prepare for any future legislation, this guide covers the basics of what you need to know.

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The Effect of Immigration on the Restaurant Industry

Immigrants are a core pillar behind the American restaurant industry. More than a fifth of the workers in this sector are foreign-born. And the foreign-born demographic is only growing in importance as fewer and fewer 16 to 24-year-olds are choosing to join the restaurant industry's labor force, a group which had previously represented 40% of restaurant workers.

Over past decades, immigrants have played an important role across the restaurant sector. In the future, though, their role is only going to become more vital. However, due to the changing political outlook, there is significant uncertainty about what this role could look like.

Immigrant Demographics in the Restaurant Industry

A recent American Community Survey by the U.S. Census Bureau found that 8% of foreign-born workers in the U.S. work in the restaurant industry. These 2.3 million employees are part of a sector that tends to employ more immigrants than other sectors in the economy. And when compared to domestically-born Americans, immigrants working in restaurants will often hold higher paying jobs, such as restaurant manager and chef. On top of this is the statistic surrounding immigrants and restaurant ownership—29% of restaurant/hotel businesses are owned by immigrants.

The Restaurant Industry's Future

The fact is that there are simply not enough potential restaurant employees within the U.S.-born workforce. And this gap is only going to get wider over the next 10 years, as the restaurant industry's workforce needs will grow by 14% and the U.S.-born workforce will only grow by 10%. These statistics make it clear that the 1.8 million new restaurant jobs will need to be partially filled by immigrants.

Restaurants in many areas are already feeling the strain. The Chicago Council on Global Affairs recently found that local restaurants are in dire need of more labor and that in their experience the best place to find it is with immigrants. In Chicago, the problem is that the U.S.-born population is aging, moving on to higher-skill jobs, and shrinking in number. In short, immigrants are becoming the only option.


The Relationship Between Undocumented Workers and The Restaurant Industry

The restaurant industry is not only heavily dependent on immigrants, but also on undocumented workers. A recent Pew Research Center study found that undocumented immigrants make up 11% of bar and restaurant employees in America. When this is translated into hard numbers, 1.3 million undocumented immigrants are employed by the restaurant industry.

In big cities this percentage is often much higher. Cities like New York and Miami will often see undocumented workers making up at least 30% of their restaurants' employees. And these immigrants are not the ones who will have the higher paying jobs. Quite the opposite, actually. 19% of dishwashers in the U.S., 20% of cooks, and 17% of busboys are undocumented immigrants.


Politics, Immigration, And the Restaurant Industry

In the past year, politics, immigration, and the restaurant industry have become more entangled than ever before. The main reason for this is DACA, or the Deferred Action for Childhood Arrivals policy. The policy was implemented by President Obama in 2012.

DACA protects immigrants who were brought to the U.S. as children and, if it is demolished, these immigrants would be deported or at least stripped of their right to work and live in America. This could negatively impact the restaurant sector as nearly a fifth of the 700,000 immigrants who hold this status are restaurant and food sector employees.

But this relationship between these factions goes far beyond just DACA. There have been raids across the country. Immigration and Customs Enforcement has entered restaurants, detained any undocumented workers, and closed the restaurants. Due to the high number of undocumented workers that some establishments have, the entire restaurant is often unable to ever open again.

Many individuals across the restaurant industry have decided to fight back. They are peacefully protesting and attempting to show the country how vital immigrants are to their workforce. The method they are choosing to use is strikes. Restaurants across the country have held a 'Day Without Immigrants' strikes. On these days, some restaurants will shut down completely, showing local patrons how heavily they rely on immigrants for food preparation and service. Other restaurants will run on low staff, using only a single chef and waiter. The slow service and low number of patrons who can come to the restaurants is meant to be a warning for what would happen if immigrants are banned or deported.


Current And Future Immigration Legislation That Affects The Restaurant Industry

Restaurants know they need immigrants, whether documented or not, to continue operating effectively. Many individuals across the nation, however, disagree. It is for this reason that several legislative policies have already been enacted or are currently being discussed by the executive, legislative, and judicial branches. To help restaurant operators prepare for this legislation, here is a guide that covers what you need to know.

Foreign Terrorist Entry Executive Order

This executive order has been covered in the news for over a year. It has gone through several iterations. In its current state, though, it places severe travel limits on individuals and refugees traveling from Iran, Libya, North Korea, Somalia, Syria, Venezuela, and Yemen.

Secure Borders Executive Order

Executive Order 13767 is dedicated to escalating border security. It will do this through the construction of a wall, increasing efficiency with deportations, and strengthening the ties between local and federal law enforcement agents. Construction on the wall began in February 2018. There have also been increases in deportations.

When it comes to restaurants, this executive order will have a similar effect to the previously mentioned executive order. The main difference is that it will have a greater effect on undocumented immigrants rather than documented immigrants. Additionally, not only will immigrants face more challenges in getting into and leaving the U.S., but there is also a higher chance of ICE raids and deportation of undocumented workers in restaurants.

Sanctuary Policies

These policies include both DACA and the DREAM Act. DACA was described above and the DREAM Act is legislation that enables undocumented immigrants, who are young, to get permanent residency through a legal route. These are both sanctuary policies. In other words, they limit law enforcement's freedom to arrest undocumented immigrants.

The Supreme Court is deciding on sanctuary policies so it is unclear what the repercussions could be. In terms of the effects on the restaurant industry, it will be younger undocumented workers or those who are covered by the DREAM Act and DACA who will be impacted. Immigrants who currently have the right to work could soon be stripped of these rights and possibly deported.

Employment-Based Immigration

Many immigrants use H1-B visas, or work permits, to enter the U.S. These visas allow people with many different backgrounds to enter the country and get work, from unskilled laborers to individuals who have niche educational backgrounds and abilities. The government is currently discussing using a point system to designate work permits. The point system would give points to foreigners for the various skills, experience, and education that they have. However, it would be heavily skewed towards those who are fluent in English and have advanced university degrees. Individuals who do not incur enough points, would not be allowed to work in the U.S.

The majority of immigrant restaurant employees are unskilled, or at least not highly skilled enough to acquire points for a work permit in the new point system. It is this new legislation around legal immigration, if it is successful, that will most heavily devastate the employee base of restaurants across the U.S.

Immigrants are a cornerstone of the restaurant industry. In order to prepare for all potential outcomes in legislation, restaurant operators should begin strategizing, finding potential options, and voicing their opinions and needs to the government. In short, knowledge, preparation, and activism will be key in assisting restaurants to face government legislation and changes in immigrant availability to the workforce.