Unless you're a really special restaurant with significant differentiation capabilities and people come to eat at your place irrationally, here's a tip:
Restaurants are never the ones making the money. They enable others to make money. Usually, landlords.
And generally, be cautious about going into a business where people want to do it because it's their passion. It means you're going to competing with people who are willing to work for nearly $0 because it's their passion.
That's a good observation about landlords. Often if you find a local "ethnic" restaurant that's been there forever and is run by a family (typically Chinese/Indian/Thai/etc) they own the building or at least the space for their restaurant. That means they can stay in business basically infinitely (well, until now) without worrying about rent increases. But this is a different model than most trendy restaurants where the owners are not interesting in buying a property outright - those are seen as an investment not as a steady income for a family.
I don't think the passion argument is that valuable. For a LOT of people programming is their passion. Yet they command some of the highest salaries. The labor market doesn't care about passion. It will settle where it needs to based on demand and supply.
May I introduce you to the video games industry? While there are good paying jobs out there, I'd risk saying the vast majority of people working in games are hugely underpaid. At my first job I was literally told "yeah the pay is crap, but you get to work on big titles so it's fine". And it's not just demand and supply - we're having a very hard time recruiting for senior positions as there just aren't any candidates around, but the pay is still very poor compared to other industries.
If you are not able to recruit then that pretty much proves you are underpaying, right? If you pay market price for devs you would not have trouble recruiting, well, devs.
Yes, seems obvious, right. But every time I tell HR that we have to pay more or we won't find candidates it's always the same - "that's the standard industry pay, there's nothing wrong with it, we've done our research and programmers in comparable positions are paid this much or less"
If we offer industry standard pay for games companies, we get industry standard hiring crisis and candidate quality, as seen at other games companies. Have you researched hiring success at other companies and not just salaries?
Experience suggests the answer to that from HR would be cultural inertia though, so it's not really them you'd need to persuade. It's a strategic decision for the company leaders, whether they think it's worth spending more to attract hires of the type who get better offers elsewhere.
Right, HRs exist to do the bidding of the execs, not be independent critical thinkers. They couldn't personally care less how much people are paid, they only need to be seen as doing broadly what the execs have approved.
Individual HR people may not all be critical thinkers, but HR people do salary research and keep up with trends in hiring. They have their own professional communities where they discuss this stuff. Even if they aren't all individually doing it, some within the HR communities look at such things and talk about it with others. They use this to advise each other and their execs if nothing else.
HR industry groups could, as a body, look into whether "the industry standard" is getting hiring results as well as employee churn, satisfaction, and company-reported satisfaction with their hiring outcomes and make that information available to HR people and then to whomever needs to take it into account in strategic decisions.
> there just aren't any [senior] candidates around
I think that statement is almost certainly false.
Offer better pay, conditions and interesting work that has career prospects for the people when they leave, and make it known you are doing this, and I think you will have plenty of interested, good candidates.
(Unless you make crappy games infested with 15s gameplay alternating with 30s brain-polluting ads, and that's for the people who paid for the "ad-free" feature. I jest not - I just turned down a recruiter for a games company looking for someone in a senior role, after I researched the company and the first few reviews I looked at showed the games fit the above description. I copied the reviews over to the recruiter and said this this is why I could not imagine myself working there in a salaried role.)
I work for one of the largest developers in the world - the career prospects and attractiveness of work are both not an issue. I'm surrounded by people who have worked here 15, 20, even 25 years, we pretty much never let people go unless they want to leave and try something else, and generally the company tries to bend over to accomodate any wishes towards your dream career path(I personally know several people who changed their speciality within company just because they wanted to, and the company did everything it could to accomodate such changes) - you can also move to any of our 40+ studios across the world if you so desire(there is a process, but no one is going to stop you from transferring if you want to do it). Pretty much everyone here has worked on at least one title that sold 10+ million copies - it's a pretty good place to work all things considered.
No, the main and only problem is pay, and it all stems from the fact that there are hundreds of applicants willing to apply for junior positions, some of which I am certain would literally chop their own leg off for the opportunity to work in video games - if it was legal they would literally agree to work for free. So they all start on some extremely low salary(especially considering that actually, our standard for hiring programmers seems extremely high and I have no doubts that those people could find much better paid jobs elsewhere), but obviously that leads to problems further down the line.
But, just because we have thousands of applicants for junior positions, that doesn't mean we have as many for say Senior roles - those see barely anyone applying, and yes, I'm 100% convinced it's purely because of pay. And the pay is what it is, because HR considers it unacceptable to pay new hires more than what we pay people who have advanced through the ranks naturally(which obviously cannot be a lot, seeing as your starting salary as a junior was so low, even if you somehow through some miracle managed 10% increase every year that's still not a lot by the time you get promoted to senior).
I think he's saying the passion factor will increase the supply. I think the same thing happens some with programming, it's just a lot fewer people have the passion (and ability?) than for cooking food.
The same thing happens with teachers, nurses, firemen, police... I think the reason they generally don't make more money is many people have a passion for doing those jobs (ask ten kids what they want to be when they grow up), but they aren't super difficult, so there's a large supply.
Teachers, nurses, firemen, and police officers would like to have a word with you.
Programming may be mathematically complex and difficult to learn, but it does not corner the market on difficulty.
Try adapting a teaching curriculum for online learning for fourth graders, working 16 shifts in an ICU during a pandemic while trying to keep people safe, planning and organizing a response to statewide wildfires, or de-escalating complex interpersonal issues dealing with crime, safety, and mental illness on the daily.
The devil is in how well you do your job. Handling those things well is difficult; handling them well enough the government won't fire you (for which the bar seems to be fairly low) is not.
We've been flooded with reports of how we are not adapting to the change to online learning well.
Working in the ICU during a pandemic is not a complex task; the procedures for doing so are fairly simple steps posted on charts everywhere. There are degrees of complexity to being a nurse depending on the level of certification you have. Physician's assistants have abilities fairly close to a doctor.
Planning and organizing responses to state wildfires is far outside the scope of a firefighter. There are a very small number of people that plan and organize, and a large number of people who implement.
I do not think de-escalating is well-embraced form of policing in the US. If it is, we are doing a terrible job. Police in the US kill drastically more people than other countries. It's not uncommon for European countries to go a full year without police killing a single citizen. There are, of course, more complexities to it than that, but it would be hard to reconcile a doctrine of de-escalation with the absurd number of police shootings we have.
Doing those things well is hard. The fact of the matter is that there is a distinct lack of expectation that those things will be executed well. No one is going to be punished for online schooling failing, botched responses to wildfires, or for shooting a homeless person. In the face of that, they're certainly not herculean feats of strength.
>The same thing happens with teachers, nurses, firemen, police
Maybe there's something different going on there since government salaries don't respond normally to market supply and demand. Perhaps a better way to track the true value of those jobs is by looking at private sector counterparts, such as security contractors or teachers at private schools.
Also, as far as I know (that would depends on the country, but I believe it is generally true), those professions (except for teachers) can't go on strike too much, they have to keep a minimum service running, which vastly limits their negotiating power.
It boils down to supply and demand, though, right?
I think the large number of people who love programming makes getting an "elite" programming job difficult.
But, I think the vast majority of people think they'd hate or couldn't do programming, and so never consider it as a job despite how much demand there is for it. And that keeps our entry level wages safe.
There is an entire world of people who are willing to work for less and developing can be done remotely.
Even ignoring that. Everything gets commoditized over time. How much does your typical PHP/Wordpress developer make now? Companies like make it easy for someone who doesn’t know anything about programming to make a decent website. There are companies now that make it easy to make a cut and paste iOS app.
Is it a work for $0 market due to passion though? I love programming. I am either programming, writing, or sleeping.
I wouldn't live in a box with roommates to be one though. I think many of us would find regular engineering or analytics jobs instead. Slightly less interesting, but we could still program within those jobs.
People who love food are basically willing to live in poverty to do it.
Yeah... and here's a thing. I can write programs all day long at home. I could spend the rest of my life on personal projects if I so chose, and had the financial security to do so. If I somehow ran out of ideas, I could write software for friends and family. If I wanted to scale up from there, I could work on open source projects. Some types of projects would be closed to me (big research, projects requiring specialized hardware, etc), but there's a lot a person can do on their own as a hobby.
Compare this to food. Beyond a very small scale (cooking for the immediate family, occasionally cooking for family events) there's a very fast, hard limit on what you can do as a hobbyist.
So, this is a refutation of one of the author’s points: either you differentiate, or is is unskilled labor (and the iron law of wages is nipping at your toes).
It’s possible to differentiate purely on marketing and not just food alone, too. But it’s madness to expect to make your money on volume in the restaurant biz and make any significant money without double-digit location counts and significant capital reserves; too many other giants can squeeze you without a thought (eg the McDonalds $1 value menu the author also cites).
Nobody’s “in” to paying >$10 for döner kebap. You have to differentiate a lot more than that; unlike me (and edge case) most people will not pay $25 to scratch the itch of the intense periodic lust for dönerfleisch.
"either you differentiate, or is is unskilled labor"
I don't think this assertion holds up, especially if you look at other industries.
A car mechanic doesn't have much room for differentiation beyond "I can service more car brands" and "I'm cheaper" or "I'm faster". Anyone can match your offering as long as they can balance the trade-offs involved (sufficient resources, etc). That doesn't make being a car mechanic unskilled labor - doing car repairs properly and efficiently requires a lot of practice and training.
Similarly, if I'm a bank there's only so much differentiation I can offer. Different financial services and interest rates or stuff like that, sure, but at the end of the day I just store people's money in accounts and provide loans. That's basically all I do, and any other bank can do it. A bigger bank has the ability to do it better (due to their resources and regulatory capture) no matter how much I differentiate myself, and since it comes down to policy in many cases another player can just come in and copy all of my policies. None of this means that working in banking is "unskilled labor".
The tendency to call people like chefs or line cooks "unskilled labor" is disgusting. Being a line cook or a chef in a high-pressure restaurant environment is REALLY HARD and takes tons of practice and training.
> The tendency to call people like chefs or line cooks "unskilled labor" is disgusting.
I don't think this is disgusting. I don't believe it's meant to imply what I believe you think it implies. It sounds to me as if, in your life, this term "unskilled labor" may be used as a slur --- is this the case? It is not the canonical intent behind "skilled/unskilled labor" terminology.
"Unskilled labor" means you don't spend years on preliminary education before you can even enter the job market. It means you can hire a person with no prior training or pertinent education and expect them to be able to succeed given a reasonable training program and work ethic. Compare this to "skilled labor" where entry into the field is gated upon higher education (or perhaps apprenticeship).
I'm not disparaging line cooks. As you say, it's very high-pressure, and experience and drive are critical to competency in such an environment.
PS. I do also agree that "differentiation" and "skilled/unskilled labor" are orthogonal concepts.
Sorry, I was totally unclear. Either you differentiate, or you can expect to be paid like unskilled labor (which is what undifferentiated cooking results for sale pays), which is always very close to zero (thanks to the iron law of wages).
Simply expecting people to pay more for what amounts to an undifferentiated near-commodity product is a pipe dream so long as anyone out of work can be taught to work a grill in a couple days.
Regardless of their skill, they're competing with the general, unskilled population, who are overwhelmingly capable of, if disinclined towards, cooking their own food or eating packaged food.
The iron law of wages was based, among other things, on Malthus' demographic theory. Modern economists are highly critical of it. Supply and demand are sufficient to explain the wages of cooks and dishwashers: anyone can be trained in a couple weeks to be a minimally competent cook or dishwasher. The labor supply is roughly equal to the number of people who need any kind of work.
Restaurants are never the ones making the money. They enable others to make money. Usually, landlords.
And generally, be cautious about going into a business where people want to do it because it's their passion. It means you're going to competing with people who are willing to work for nearly $0 because it's their passion.