Labour Cost Percentage by Type of Restaurant
Full-service restaurants report median labour costs of 36.5% of sales and limited-service 31.7%, according to the National Restaurant Association’s 2026 State of the Industry report. Bar-led venues are generally quoted at 25–35% and independent coffee shops at 28–35%, though those two come from trade sources rather than survey data. The five-point gap between table service and counter service is structural: it reflects a service layer that quick-service formats never roster.
Figures verified July 2026
| Format | Reported / quoted labour cost |
|---|---|
| Full-service restaurant (median) | 36.5% |
| Full-service, profitable operators | 34.2% |
| Limited-service / quick-service (median) | 31.7% |
| Coffee shop, independent | 28–35% |
| Coffee shop, high-volume counter | 25–28% |
| Bar and pub | 25–35% |
Why the gap between formats is real
A full-service restaurant employs people whose entire job is service: servers, runners, bussers, hosts. Counter-service formats hand most of that work to the customer. So the difference in labour percentage isn’t a measure of who runs a tighter operation, it’s a measure of what the customer is buying. Importing a quick-service target into a table-service room mostly degrades the product.
What the benchmarks include, and why it matters
The National Restaurant Association’s figures cover wages including benefits. If you calculate your own number from gross wages alone and compare it against theirs, you’ll conclude you’re doing better than you are. Payroll taxes, holiday pay, pension contributions and any health coverage all belong in the numerator before the comparison means anything.
The direction of travel
The same organisation reported full-service respondents averaging roughly 33% of sales and limited-service roughly 28% across its 2010, 2013 and 2016 editions. Current readings sit several points above that. Whatever your own number is, the useful question is which way it has moved over the past two years and what caused it.
When a high percentage isn’t a labour problem
Labour cost is a fraction, and a bad-looking result is as often a sales failure as an overstaffing one. Before you cut shifts, check whether covers have fallen while the rota stayed put; the fix for that is filling the room, not thinning the floor.
Every figure with its source
| Figure | Value | Source |
|---|---|---|
| Full-service (median)1 | 36.5% | National Restaurant Association2026 |
| Full-service (profitable operators) | 34.2% | National Restaurant Association2026 |
| Limited-service (median)2 | 31.7% | National Restaurant Association2026 |
| Coffee shop, independent3 | 28–35% | Barista LifeAccessed July 2026 |
| Bar and pub4 | 25–35% | The Fork CPAsAccessed July 2026 |
1 Wages including benefits.
2 Wages including benefits.
3 A trade convention, not survey data.
4 Quoted across the trade; no measured source behind it.
For the same numbers organised by type of business, see the cost benchmarks by food business, and for what staff cost where you trade, see labour costs by region. If you run a table-service site, queue management software is the operational side of the throughput problem these figures keep pointing at.
Run your own numbers
Frequently asked questions
What is a good labour cost percentage for a restaurant?
It depends on format. The National Restaurant Association reports a 36.5% median for full-service and 31.7% for limited-service. Profitable full-service operators sit closer to 34.2%.
Why do quick-service restaurants have lower labour costs?
Because they don’t roster a service layer. No servers, runners or bussers, the customer seats and often clears themselves, and the order is taken once at a counter rather than across several table visits.
Should labour cost include benefits and payroll taxes?
Yes, if you want to compare against published benchmarks. The National Restaurant Association’s figures include benefits, so a gross-wages-only calculation isn’t comparable.
Is a 40% labour cost too high?
It’s above the full-service median, but whether it’s a problem depends on your food cost. What matters is prime cost: if food plus labour leaves enough for rent and profit, the split between them is largely a matter of concept.
Related
- Food Cost Percentage by Type of Food BusinessThe quoted ranges by format, and an honest account of where they come from.
- Prime Cost: What It Is and What Yours Should BeFood plus labour, and the one ratio worth managing against.
- Food Business Cost Benchmarks: Every Figure, With SourcesEverything on one page, each figure attributed and dated.
Sources
- National Restaurant Association — 2026 State of the Restaurant Industry2026 · Industry research
- Barista Life — Coffee Shop Labor Cost PercentageAccessed July 2026 · Trade press — cited convention, not measured data
- The Fork CPAs — The Ideal Labor Cost for a Restaurant or BarAccessed July 2026 · Trade press — cited convention, not measured data