Cost-Effective Hiring Solutions for Restaurants in 2026

A 2023 study by Toast found that “30% of staff in the restaurant industry are at risk of leaving in the next 2 years”, and that “26% of F&B businesses believe staffing shortages will only worsen over the next 12 months.”

If you want to hire for your restaurant in 2026, it can be difficult to find the right people.

In this guide, we explain where money is lost in traditional hiring, how cost-effective alternatives work, and what restaurant operators should consider when choosing a platform.

Let’s get into it. 

Key Takeaways

• Many operators overspend on staffing without realizing it, cutting into already tight profit margins and, for example, posting repeatedly on job boards (and paying extra to boost vacancies), relying on expensive, contract-based staffing agencies, or burning payroll through overtime to cover gaps.
• A new wave of hiring solutions is helping restaurants control labor costs without lowering quality or increasing managers’ workloads.
• On-demand hiring platforms are a more cost-efficient, flexible alternative. shiftNOW is a great example of a platform like this, with vetted local talent, flat-rate low placement fees, and a pay-per-use pricing model. 

Where Restaurants Commonly Overspend on Hiring

Job Board Posting Cycles

If you want to hire via job boards, then you’ve got to pay. Not enough potential candidates will see your adverts if you don’t.

Recurring posting fees add up quickly, especially when roles must be reposted due to low-quality applicants or no-shows. Job boards are a numbers game, pure and simple. They pull in employers using the hope-based hiring model.

But then these massive job boards make you pay to ensure your posts get seen. There’s absolutely no guarantee of local, hospitality-ready talent.

Staffing Agency Markups and Placement Fees

In comparison, staffing agencies, whether multinational or local, might seem like a better option. But they have a major drawback: traditional agencies often charge markups of 20 to 40% and large placement fees, which significantly inflate labor costs.

If you’ve got a reliable agency that specializes in hospitality and restaurants, then they might solve your staffing problem. But most agencies don’t specialize in hospitality, leading to mismatched hires and faster turnover.

Hidden Overtime and Understaffing Costs

Managers and owners need to be wary of hidden costs. When core teams are stretched thin, overtime hours spike. Payroll budgets go up, and everyone is overworked.

Understaffing can also reduce revenue by affecting service quality, table turns, and guest satisfaction. This can lead to negative reviews that put off potential customers, costing you a lot of money very quickly. 

Manager Time as an Operational Cost

Manager time is an operational cost too. Managers should spend time on activities that drive revenue, not on filling staffing gaps. 

Reviewing applications, scheduling interviews, onboarding workers, and rehiring after no-shows (which almost always happens when you hire from a misaligned source, like job boards) consume valuable manager time.

These indirect labor costs accumulate quickly and reduce your restaurant's overall efficiency, especially if you keep having to look for staff to fill gaps. 

Now, let’s look at more cost-effective hiring models that make a big difference in these more challenging economic times. 

How Cost-Effective Hiring Models Improve the Bottom Line

Pay-Only-When-You-Use Platforms

Being able to pay for the time on-demand workers actually work makes a big difference to a restaurant's costs and bottom line. Modern platforms allow restaurants to avoid fixed monthly subscriptions and pay only for shifts actually posted or filled.

Elimination of Placement Fees

Removing traditional placement fees significantly reduces the cost of hiring long-term or temp-to-hire workers. With on-demand platforms, you can hire straight away and only need to pay the worker for their time, plus a small placement fee. 

Access to Vetted Talent Without Upfront Investment

The good news about on-demand platforms is that you get immediate access to pre-screened, hospitality-ready workers. This reduces mismatches, minimizes the need for re-training, and decreases staff turnover. All of this reduces your costs. 

Faster Shift Coverage Reduces Revenue Loss

This ability to quickly fill open shifts prevents understaffing. It improves service consistency and protects revenue on busy days.

If you want to solve staffing problems with an on-demand solution, shiftNOW is a regional, hospitality-focused platform worth exploring.

Comparison Overview: What Cost-Effective Options Look Like Today

There are pros and cons to every approach, so let’s see how the options for hiring for restaurants compare. 

Job Boards

• Pros: 
  
  • Extensive reach
  • Familiar workflow
  • Likely to get dozens of candidates
    
    
• Cons: 
  
  • Jobs boards like Indeed are expensive
  • Costs even more when repeated posting
  • Costs more when you need to “boost” a job ad
  • Low reliability
  • Usually misaligned, or no skill/experience in hospitality, catering, restaurants, bars, events, or hospitality
  • Heavy manager time investment

Staffing Agencies

• Pros: 
  
  • Quick access to a talent pool 
  • Might have hospitality experience
    
    
• Cons: 
  
  • High fees  
  • Long-term contracts 
  • Lots of contract add-on costs  
  • Inconsistent hospitality specialization

Generic Gig Apps

There are lots of generalized gig apps around with millions of potential “gig economy” workers who could solve your staffing problems. The problem is, only a small percentage of these can actually solve your on-demand staffing problems. 

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Gig apps include Upwork and TaskRabbit. 

• Pros: 
  
  • Fast access to a broad on-demand talent pool
    
    
• Cons: 
  
  • Inconsistent quality of talent  
  • Low hospitality experience  
  • Lot’s of no-shows
  • Pay to boost adverts if people are needed quickly 
  • Not ideal for restaurants

Hospitality-Focused Hiring Platforms

• Pros: 
  
  • Vetted hospitality talent
  • Temp to hire
  • Regional focus  
  • Fast access to local talent
  • Cost-effective
• Cons:
  
  • Potential over-reliance on on-demand staff without maintaining a reliable core team

Unlike the above options, shiftNOW is regional (currently in the Southeast U.S.) and hospitality-centric, with thousands of flexible workers ready to help restaurants, bars, and events. 

You’re only going to find vetted, qualified temp workers with experience in this sector, making it better for restaurants that specifically need on-demand staff. 

For example, shiftNOW uses video profile hiring and the temp-to-hire approach to ensure workers have relevant experience in restaurants and the hospitality industry. 

Here are five best practices for restaurants looking to reduce hiring costs. 

5 Best Practices for Reducing Hiring Costs

Use Detailed, Attractive Shift Descriptions

Clear expectations improve applicant quality and reduce mismatches. Well-written shift descriptions should outline specific responsibilities, required skills, venue type, and shift timing. When candidates know exactly what they're walking into, they're more likely to accept shifts they're genuinely suited for, which dramatically reduces no-shows and first-day dropouts. 

Include details about the pace of service, uniform requirements, and any specialized equipment or POS systems workers will use.

Leverage On-Demand Workers to Avoid Overtime

Strategic scheduling lowers payroll spikes and protects margins. Overtime pay can quickly erode profitability, especially during unexpected busy periods or when full-time staff call out sick. By maintaining relationships with reliable on-demand workers, restaurants can fill gaps without pushing existing employees past 40 hours. 

Build a Favorites List of High-Performers

Repeat workers lower onboarding time and enhance consistency. Once you've identified strong performers who understand your venue, standards, and culture, prioritize them for future shifts. These workers require minimal training, integrate seamlessly with your team, and deliver consistent service quality. 

Use Competitive Rates to Attract Strong Talent Quickly

Slightly higher hourly wages can reduce turnover and long-term hiring costs. While it may seem counterintuitive, paying moderately above market rate often saves money overall. 

Quality workers fill positions faster, stay longer, perform better, and require less supervision. The premium you pay per hour is typically offset by reduced recruitment frequency, lower training costs, and improved customer satisfaction that drives repeat business.

Use On-Demand Labor for Peaks Instead of Over-Hiring

Seasonal waves can be covered flexibly without long-term commitments. Tourist seasons, holidays, and special events create temporary staffing demands that don't justify permanent hires. 

On-demand workers allow you to scale up quickly during these peaks and scale back down without severance costs, unemployment claims, or the awkwardness of reducing someone's hours. This flexibility protects you from carrying excess labor costs during slower periods.

Let's also remember the five pitfalls that usually increase hiring costs, so you know what to avoid as a busy manager or operator.

5 Common Pitfalls That Increase Hiring Costs

Overspending on Repeated Job Posts

"Repost until you get lucky" rarely works in restaurants. Continuously posting the same generic job ads across multiple platforms burns through marketing budget without addressing the problem

This problem is usually unclear requirements, uncompetitive wages, or poor shift timing. Each repost costs money and manager time while delivering diminishing returns. 

Using Agencies for Roles That Don't Require Them

Agency markups unnecessarily eat into margins. Traditional staffing agencies typically charge 20 to 40% markups on hourly wages, which makes sense for specialized or hard-to-fill positions. 

For servers, bartenders, hosts, and line cooks, modern on-demand platforms offer comparable quality at significantly lower rates, preserving precious margin points.

Posting Shifts Too Late

Rush postings often require higher wages or produce weaker candidates. Last-minute staffing needs force you into a weak negotiating position. Workers know you're desperate, which drives up rates. 

You also have less time to properly vet candidates, increasing the likelihood of hiring someone who's a poor fit. Planning shifts at least 3 to 5 days in advance gives you access to better talent at standard rates.

Underpaying, Leading to Higher Staff Turnover

Low wages cause churn, which drives up long-term costs. Trying to save money by paying below-market rates is a false economy. Workers leave quickly for better opportunities, forcing you into a perpetual cycle of recruiting, interviewing, onboarding, and training. 

The constant churn also damages team morale, service consistency, and customer experience. The total cost of replacing a worker typically exceeds several weeks of wages.

Not Building a Consistent Bench of On-Demand Workers

Inconsistency leads to retraining costs, unpredictability, and service issues. Constantly working with different temporary staff means repeatedly explaining your systems, standards, and expectations. New faces every shift create confusion in the kitchen and inconsistent service in the dining room. 

Final Words

Cost-effective, on-demand restaurant staffing doesn't mean hiring cheaply. It means hiring smart.

Modern on-demand platforms help restaurants lower hiring costs, reduce manager workload, and improve shift reliability.

If you want to solve staffing problems with an on-demand solution, shiftNOW is a regional, hospitality-focused platform worth exploring.

Ready to get started? Request a demo with shiftNOW today.  We have you covered when you need cost-effective restaurant staff.

Request a Demo

Frequently Asked Questions (FAQs)

What’s the most cost-effective way for restaurants to hire?‍

With a mixed approach. Having an in-house permanent team of full and part-time staff, especially managers, and augmented by on-demand staff. This way, you’ve always got the staff you need and can ramp up and down flexible staff - especially if you stick with reliable ones - as demand requires. 

Do modern staffing platforms really reduce hiring costs?‍

Yes, because unlike jobs boards or staffing firms, modern staffing platforms are more cost-effective for any company that needs to hire temp, flexible, or seasonal staff. 

Are on-demand workers more expensive than regular employees?‍

In comparison, no, because you aren’t paying all of the associated costs you normally do with full-time employees, like taxes, pensions, healthcare, and other benefits. The slight extra you might have to pay to attract top-tier talent is offset by the savings compared to full-time staff, so you do save money. Plus, money is saved compared to other ways to hire temp staff, like job boards and staffing firms. 

Can restaurants hire on-demand workers full-time?‍

Yes, if you find one or more on-demand workers who are a good fit for your restaurant and you have a full-time vacancy, you can hire them. You might need to pay a separate fee for that. However, compared to a recruitment company's fee, it’s still going to be more cost-effective, and it means you’ve found the ideal new team member for your restaurant. 

What’s the best way to lower turnover-related costs?‍

Staff turnover is expensive. If you don’t have enough staff to cover the front and back of house and ensure customers are happy, you’re going to lose money. Plus, you’ll already be losing money by having to hire someone new to fill the role. 

So, you’ve lost money both ways. It’s better to save on staffing costs with flexible staff, and then, if there’s someone who would be a great fit for your team, offer them a permanent role. 

How can small restaurants reduce recruiting expenses?‍

The best way to keep recruiting expenses low is to use cost-effective on-demand staffing platforms like shiftNOW. We only ever charge a low flat rate per on-demand hire.