Shake Shack will be committing $10 million to its restaurant teams, including $9 million in wage increases, the burger-and-fry joint revealed Wednesday.
The funds will be dispersed over the next 12 months, with nearly $1 million going toward hiring bonuses and an additional amount toward leadership development programs for employees, as well as equity grants for managers.
“We are committed to doing the right thing for our teams, guests and communities during the good times and especially the tough times, and the tough times brought on by the COVID-19 pandemic have shown us the resilience of our people,” the company said Wednesday. According to its blog post, the investment is aimed at “retaining the best restaurant talent, ensuring current and future employees are well-paid, cared for and have a path to promotion and opportunity for sustainable career growth within Shake Shack and the industry at large.”
The move comes after a fruitful quarter for the fast-casual chain, which in May revealed a Q1 2021 revenue of $155.3 million, up 8.5% from the same quarter in 2020, and a net income of $0.6 million, pivoting from a net loss the year before.
But more notably Shake Shack, like several of its publicly traded restaurant peers, stocked up on cash during the COVID-19 pandemic, which CEO Randy Garutti described in an earnings call as a “moment where no company was unsinkable.” The company’s recent equity deal beefed its cash-on-hand to more than $400 million. As such, today’s program could very well be among the first of several growth initiatives.
It also comes as the restaurant industry struggles to claw its way out of the pandemic recession. Despite sweeping rebounds for the U.S. labor economy, the sector still remains 1.3 million workers short of pre-COVID times, and it’s currently among the highest for employee-quitting. In this pressure-cooker environment, competition for fast-food staffers is heating up, with a host of big-name companies sweetening the deals: McDonald’s, which is one of several chains that has struggled to fill roles post-COVID reopenings, recently bumped hourly wages and began offering perks including paid tuition and emergency child care.
Shake Shack currently operates 321 locations globally. In June, it revealed it would be expanding its outposts in China.