The restaurant industry is now the Pittsburgh region’s biggest employer. Can anything be done to ensure that wages grow too? | News | Pittsburgh | Pittsburgh City Paper

The restaurant industry is now the Pittsburgh region’s biggest employer. Can anything be done to ensure that wages grow too?

“Raising wages is going to provide a boost in the local economy and that is important.”

The restaurant industry is now the Pittsburgh region’s biggest employer. Can anything be done to ensure that wages grow too?
CP photo by Jake Mysliwczyk
Bar Marco co-owner Justin Steel

With Pittsburgh’s economic rebirth fully underway, new nicknames have been emerging to replace its “Steel City” moniker. One of the most popular is “Roboburgh,” a nod to the city’s growth as a tech, robotics and artificial-intelligence hub. But a more accurate nickname might actually be Restaurant-burgh. 

Restaurants and bars are now providing the most jobs of any industry in the Pittsburgh region, according to Idaho-based labor-market analytics firm Emsi. (Emsi broke down the region’s job numbers according to the North American Industry Classification System, used by the U.S. Bureau of Labor Statistics.) From 2010-2016, the restaurant-and-bar industry added more than 7,300 jobs and surpassed local government as Pittsburgh’s top job-provider. In 2016, the Pittsburgh region had 87,300 restaurant jobs. 

Other industries providing large amount of jobs fall into Pittsburgh’s oft-cited “eds-and-meds” and tech sectors, namely educational services, hospitals, and scientific and technical services. But these large industries, which have also seen significant growth, have one major difference with the restaurant industry: earnings. Jobs at hospitals, schools, and tech and science firms all pay well over the Pittsburgh region’s 2016 average income of $32,582, with tech jobs doling out a 2016 average of more than $96,000 per job. 

On average, by contrast, restaurant-industry jobs pay $19,330 (not including tips), the lowest of any industry in Pittsburgh. This discrepancy has led labor unions and workers’-rights groups to demand higher wages and additional benefits for employees of the area’s restaurants and bars. Some restaurants have even taken it upon themselves to provide better wages. Pittsburgh City Council has attempted to assist these workers too, but has run into legal opposition backed by restaurant-industry lobbying groups. All the while, statisticians hint that Pittsburgh could be due for even greater restaurant growth in the near future. But broad-based benefits for the workers of this industry have yet to materialize. 

Even with the restaurant industry now offering the largest number of jobs here, says Emsi economic-development director Josh Wright, Pittsburgh’s restaurant growth is actually quite low compared to other metro areas. The added 7,300 jobs accounted for only a 9 percent increase from 2010-2016, while most metro areas saw at least a 20 percent increase in restaurant jobs over this same time period, according to Wright. 

But Wright says that the relatively low growth of Pittsburgh restaurant jobs might not remain so in the future. He says that other industries here are growing faster, and that that growth could lead to more growth in the restaurant industry. For example, tech and science firms added 12,200 jobs from 2010-2016, and now provide some 78,000 jobs in the region. Wright says workers in those tech jobs, with their higher-than-average salaries, could feed more demand for eating and drinking establishments.  

“Pittsburgh could be due for more,” says Wright. “The theory suggests as you bring in more outside income to the region, the more discretionary income people will have. And the more they will spend at restaurants.”  

Wright says that Pittsburgh’s restaurant growth, despite its slow pace, is encouraging because most of the growth consists of full-service restaurants jobs, as opposed to jobs at fast-food establishments or take-out joints. The Pittsburgh region added about 4,200 full-service restaurant jobs from 2010-2016, compared to about 1,800 jobs at limited-service establishments (as well as a handful of other jobs at food trucks and shacks) over the same time period. 

Wright says that full-service restaurants tend to compensate their employees better, and statistics back him up. In 2016, full-service workers earned $21,000 a year, before tips, compared to $15,700 a year for limited-service workers. 

Bar Marco was one of those full-service restaurants that has opened since 2010 and it is one that’s unusually focused on providing good wages to its employees. The Strip District restaurant made national headlines in 2015 when it decided to adopt a no-tipping model, with all restaurant employees making at least $35,000 a year, with paid time off and health insurance.

Bar Marco co-owner Justin Steel says he doesn’t regret converting to a no-tipping model, and he believes it has actually helped his restaurant succeed. 

“Why have we been successful? It came down to our employees,” says Steel. “This is what they want to do as a career. It has enabled us to be a lot more efficient and do our jobs better.”