NRA: Immigration reform may be on the table in 2026
Immigration reform emerges as a pressing need for restaurant franchisees amid labor challenges.
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The National Restaurant Association's Sean Kennedy highlights the critical labor issues facing restaurants, emphasizing the need for immigration reform due to the sector's reliance on foreign-born workers. As the U.S. nears negative population growth, the association pushes for political changes to address workforce shortages.
Why It Matters
This highlights potential operational challenges for franchisees, as any changes in immigration policy may affect labor availability and costs. Addressing these political factors is essential for stabilizing workforce needs crucial to maintaining unit economics in the QSR sector.
The National Restaurant Association (NRA), represented by Sean Kennedy, chief advocacy officer, highlighted the critical nature of immigration reform for the restaurant industry in a recent Q&A. Kennedy underscored that restaurants, which are significantly labor-intensive, cannot easily reduce labor costs, making them particularly vulnerable to changes in the labor market. Since the beginning of the COVID-19 pandemic, wages have risen without recovery, exacerbating the issue. He noted, “We’re always going to have a baseline workforce need that you can't really trim down,” emphasizing that labor costs are a fundamental part of the restaurant business model.
Further complicating the situation is the increasing price competition among various restaurant types, especially Quick Service Restaurants (QSRs), which have led to intensified price wars. This competitive landscape limits how restaurants can adjust their menu prices in response to rising labor costs. Consequently, Kennedy explained that addressing political factors that contribute to increased labor costs, such as stringent immigration policies and the potential elimination of the tipped-subminimum wage, is a priority for the NRA.
