Recent reports put rising health care costs as the reason why many chain’s restaurant business plan future development will be curtailed. According to the latest news, the health care insurance expense for companies is expected to rise significantly, and more than 150 percent at one major restaurant chain. Since the labor cost portion attributable to health insurance is typically 4 percent to 5 percent of payroll costs, this would add another 2 percent to 3 percent to personnel staffing costs alone. Hear what one CEO* and foodservice industry company that employs thousands of workers had to say before Congress on the impact of the new health care legislation (a/k/a Obamacare) and how it will affect employment growth as part of their restaurant business plan: “Our company, CKE Restaurants Inc., employs about 21,000 people (our franchisees employ 49,000 more) in Carl’s Jr. and Hardee’s restaurants. For months, we have been working with Mercer Health & Benefits LLC, our health-care consultant, to identify Obamacare’s potential financial impact on CKE. Mercer estimated that when the law is fully implemented our health-care costs will increase about $18 million a year. That would put our total health-care costs at $29.8 million, a 150 percent increase from the roughly $12 million we spent last year.” *Andrew Puzder is the chief executive officer of CKE Restaurants Inc. and co-author of “Job Creation: How It Really Works and Why the Government Doesn’t Understand It.” More on his book and restaurant advice can be found here. Are you an owner, senior executive or restaurant consultant evaluating the employee health care insurance of your organization and its rising cost? Please share with our readers how these increased costs will affect your future development and restaurant business plan if at all.
Perry Group
Hotel & Restaurant Experts For The Hospitality Industry
