SoundHound AI was a sponsor of Restaurant Business’s November 2024 Market Leader Report titled, “The Restaurant Labor Landscape: Operator Insights and Profitability Strategies.” Technology, specifically voice AI and automation, emerged as necessary components of labor strategies moving forward.

Restaurant operators have been facing labor shortages for years. Now, operators face an additional challenge: rising wages.

In September 2024, Restaurant Business surveyed more than 330 foodservice operators across full-service, limited-service, chain, and independent restaurants. Respondents almost unanimously indicated that the rising cost of labor was a major challenge that will continue throughout 2025.

• 92% of operators experienced rising labor costs in the last 12 months
• 89% of operators expect labor cost to increase in the upcoming 12 months

The rapid and significant increase in employee wages is severely impacting operators’ bottom lines. To face this challenge, operators have had to employ new labor strategies – primarily focused on employee retention instead of hiring – to maintain profitability and productivity.

In this blog post, we will unpack the labor strategies that restaurant operators have implemented so far. We also will explore operators’ growing interest in deploying voice AI and automation technology, like SoundHound AI’s restaurant solutions, as part of their labor strategy going forward.

Cross-Training Dominated Last Year’s Labor Strategy

Falling second only to “raising menu prices judiciously” as a top strategy for preserving profitability in a tight labor market, 48% of operators indicated that they focused on cross-training employees over the past year.

By cross-training employees, operators aimed to increase the total productivity they could achieve from current staff to save on labor costs and preserve profit margins.

In 2025, more than 74% of operators expect wages to increase. As such, maintaining a steady headcount and cross-training will continue to reign as a top labor strategy.

Danger Signal: Overtasked Workers

By its very nature, the hospitality industry fosters a high-pressure work environment. Most employees expect this when they take on the job.

However, even the most seasoned employees have a limit to how much they can take on in a single shift.

Restaurant operators are aware of the challenges their workers face. According to the survey, operators believe their employees’ biggest pain points during a shift relate, in general, to being overtasked. For example, perceived pain points include:

• Side work, cleaning, maintenance (54%)
• Serving more guests than anticipated when co-workers call out or no-show (37%)
• Doing routine checks of critical control points or food safety checks (27%)
• Getting “in the weeds” with too many tables/transactions at one time (22%)

It’s true that cross-training employees allows restaurants to operate with a leaner team. However, it’s critical that operators don’t push existing employees to the point of dissatisfaction, burnout, or quitting.

Since retention is the name of the game, operators instead need to employ a labor strategy that strikes a balance between cross-training existing staff and leveraging technology to fill the gaps.

Technology Is Moving from Nice-to-Have to Need-to-Have

In previous years, investing in technology was not among the top strategies for operators looking to manage profitability and productivity.

Looking ahead to 2025, however, it appears more operators are interested in seeing how technology, such as voice AI and automation, can contribute to their growth, improve operations, and help retain employees.

• 68% of operators are in the market for labor-focused technology solutions
• 29% of operators want to use tech in their labor strategy to increase employee productivity
• 23% of operators want to use tech in their labor strategy to reduce labor costs

How Voice AI Drives Productivity and Profitability

The investments that restaurant operators make today in voice AI and automation can drive long-term business growth and smoother operations.

For example, SoundHound’s voice AI solutions for restaurants, such as Smart Ordering and Dynamic Interaction™, increase customer service efficiency and drive revenue growth by automating food ordering over various channels, including phone, drive-thru, and kiosks.

SoundHound AI Senior Vice President, Ben Bellettini, joined the researchers and co-sponsors of the Restaurant Business Market Leader Report for a webinar to further illustrate the impact of voice AI for restaurants. Below are some of Ben’s key insights.

Improve Productivity and Operations with SoundHound’s Voice AI

• Reducing Employee Stress: “We serve restaurants in a multitude of ways with voice AI and automation, primarily for ordering channels. And really where our technology ties in with this labor discussion is we’re able to relieve a lot of the stress on operator’s employees,” said Ben. “Surveys are showing that many operations teams would prefer to work at a location with automation because it reduces the task burden.”
• Improving Customer Service: “25% of operators are focused on encouraging better hospitality from their folks. And our goal at SoundHound is to make our AI enable the people that are working at these restaurant locations to be more human,” Ben explained. “We can relieve them of these burdensome, repetitive tasks so they can focus on greeting people.”

Optimize Transactions and Throughput with SoundHound’s Voice AI

• Increasing Throughput: “We can control how fast and efficiently we accept orders from customers and increase check size and throughput, in the case of a drive-thru. By increasing throughput, we reduce lines and make sure we’re capturing all of the potential customers that are driving by and might otherwise not pull in if they see a long line,” said Ben.
• Driving Revenue: “For the employee on the headset that’s overwhelmed, they’re not stopping and prompting, ‘Do you want to make that a combo, or a large?’,” said Ben. “So, we can optimize upselling, maximize check size, and boost revenue in the lane.”

Make 2025 the Year Your Restaurant Embraces AI

We welcome the opportunity to be a part of your restaurant’s AI journey. Contact us today to get in touch with our experts. To learn more about our solutions for restaurants, explore our Restaurants page.