How Do You Control Labor Costs Without Losing Your Best People?
Payroll is the biggest check you write. Cut it too hard and your best cook walks out. Leave it alone and it eats your profit.
The answer isn’t fewer people. It’s the right people on the right hours, and keeping the ones who make your place work. This page shows an owner or manager how.
Dr. Paul Borosky, Business Consultant, has helped 1,000+ owners get control of their biggest costs.
Talk to Dr. PaulCall or text (321) 948-9588.
Last Updated: November 2026
Real World Help From Dr. Paul
How This Guide Works
In a hurry? Doctor Owl and the 3 steps below. Want the story? Watch Marco at Fast Frankie’s pizza shop in Dr. Paul’s Fabled Forest Business School Series cut payroll without losing Opal.
- Print last week’s sales by hour next to last week’s schedule.
- Circle every hour with more staff than the sales needed.
- Move or trim those hours first. Leave your best people’s shifts alone.
How Did Marco Cut Payroll Without Losing Opal?
Payroll at Fast Frankie’s kept climbing. Frankie wanted to cut a cook. The cook he had in mind was Opal.
Doctor Owl stepped in. “Is this a fire, or a foundation?” Payroll was a fire, but losing Opal would be a bigger one. They sorted it out with Dr. Paul’s Organize-Plan-Grow™ Strategy.
- Organize. Marco lined up sales by hour against the schedule. Three people were on the clock from 2 to 4 p.m. most days, when almost nobody came in.
- Plan. He trimmed the afternoon to one cook and one counter person. He cross-trained the counter person on the oven so the shop could cover a rush.
- Grow. Marco checks labor as a percent of sales every Monday. Opal got a small raise and stayed.
Illustration only: trimming two dead hours a day saved about $960 a month. Opal’s raise cost a small slice of that.
They cut hours, not the person who knows the ovens best.
How Much Have Restaurant Labor Costs Climbed?
A lot. The National Restaurant Association reports restaurant wages are up 41% since 2019. Wholesale food is up 35% over the same stretch. Menu prices haven’t kept up.
The same analysis found 42% of restaurant operators were unprofitable in 2025. For many of them, labor is the line that grew fastest.
Source: National Restaurant Association, via MarketScale (October 2026).
What Does That Mean for Your Payroll?
You can’t control the wage market. You can control how many hours you schedule, when, and who stays. Most restaurants have hours on the schedule that the sales don’t need.
And turnover is a hidden labor cost. Every time a good person leaves, you pay to hire and train, and service slips while you do.
How Do You Control Labor Without Losing Your Best People?
- Schedule by the hour. Match staff to hourly sales, not habit or full shifts.
- Cross-train. One person who can cover two stations means fewer people on slow hours.
- Protect your keepers. A raise, a better shift, or a title can cost less than replacing them.
- Watch one number weekly. Labor as a percent of sales. Note which way it moves.
- Fix the turnover leak. Ask anyone who quits why. Patterns show up fast.
Where Does the Money Actually Go?
Illustration only. Round numbers, not a real restaurant.
Trimming hours nobody needs brings payroll down. A small raise for someone you can’t afford to lose barely moves it.
Illustration only. Round numbers, not a real restaurant.
Want Help Getting Payroll Under Control?
Bring a week of hourly sales and your schedule to a free 15-minute call with Dr. Paul. You leave knowing where the extra hours are, and what fractional COO help would cost if you want it.
Or call or text (321) 948-9588.
What Do Owners Ask About Restaurant Labor Costs?
What labor percentage should a restaurant aim for?
It depends on your type of restaurant. Track your own number weekly and work to bring it down a point at a time.
Is cutting staff the fastest way to save?
It’s fast, but risky. Cutting wasted hours usually saves almost as much without hurting service.
How do I keep good people without big raises?
Better shifts, cross-training, clear growth paths, and respect go a long way. Ask them what matters.
About the Author
Dr. Paul Borosky, DBA, MBA, helps owners control payroll and build teams that stay. He has worked with small business clients in all 50 states and Canada.
Sources
- National Restaurant Association, restaurant profitability analysis (July 2026), as reported by MarketScale, October 28, 2026.