Cheesecake Factory staffing levels rise above pre-pandemic numbers despite industry-wide labor shortageCheesecake Factory staffing levels rise above pre-pandemic numbers despite industry-wide labor shortage

The Cheesecake Factory reported Wednesday that staffing is no longer a problem for the casual-dining chain as it’s now above pre-pandemic staff levels despite a labor crisis in the restaurant industry.

“We now have approximately 1% more staff members than we did just prior to the pandemic,” said CEO and chairman David Overton. They also have 3% more staff than at the end of 2021.

Applicants-to-needs ratios are at the highest levels since the pandemic began for several positions, including cooks, prep cooks, and servers, according to president David M. Gordon.

But it hasn’t been all easy going for the Calabasas Hills, Calif.-based brand. Staffing levels may be rising, but costs are rising as well.

“The labor market also continues to be dynamic with a lot of moving parts. Inclusive of known minimum wage increases, we're now modeling net total labor inflation of about 6%,” said chief financial officer and executive vice president Matthew Eliot Clark.

Labor rose 70 basis points to 37.3% as higher wage rates more than offset sales leverage, with full-year wage inflation now expected at 6% versus 5% previously.

“I recognize that the environment is dynamic, and we continue to face substantial challenges with high commodity inflation, a tight labor market and further supply chain disruptions,” said Overton.

Gordon said: “I can't predict the future. But we are going to stay competitive. And we need to continue to not just retain those we have but attract new staff members as sales continue to grow.”

That competition is also spurred by opening dining rooms, which are currently about 85% open across the country, lagging in high tourist areas. Off-premises represented 28% of the same-store sales for the brand in the first quarter ending March 29, holding steady for the last four quarters.

“Despite these challenges, many of which are out of our control, we continue to ramp up unit development towards our 7% annual growth goal,” said Overton.

Same-store sales were up 20.7% in the first quarter at Cheesecake Factory and 32% at North Italia.

Cheesecake Factory expects to open 15 to 16 new restaurants in 2022, including four to five North Italias, and seven Fox Restaurant Concept restaurants. Cheesecake Factory is also expected to open internationally under a licensing agreement.

As of the end of the first quarter, there were 208 Cheesecake Factory units, 29 North Italia units and 31 other Fox Restaurant Concepts.