Labour costs, recruitment challenges, and team turnover have long been treated as unavoidable realities of running a hospitality business and they remain some of the sector's biggest pressures. But the latest data from the Pineapple 2026 H1 People Report, produced in partnership with us, points to a factor that consistently shapes retention outcomes and business performance: leadership stability.
Every six months, we work with Pineapple to benchmark workforce data from hospitality businesses across the UK to understand what drives stronger teams and better commercial outcomes. In this latest report, findings show an industry making progress, but they also highlight an area many operators still overlook.
Although the hospitality sector continues to operate in a difficult environment, the latest data demonstrates year-on-year improvements. Compared with 2025, team happiness increased from 50.1% to 63.8% in the first half of 2026, team turnover fell from 66.7% to 63.3%, and labour costs as a percentage of sales also dropped from 35.2% to 34.2%. These are meaningful shifts, particularly in a sector that has spent recent years navigating repeated disruption.
The challenge is that when cost pressure increases, labour budgets are often the first place operators look for savings, but the data suggests that approach can create bigger problems later. People metrics are not simply HR measures, rather they can act as early indicators of commercial performance.
One of the strongest findings from the report is the relationship between leadership stability and staff retention. Sites with stable General Managers recorded team turnover of 52%. At sites where General Managers changed more frequently, turnover rose to 82%. The same pattern appears in back-of-house teams, as venues with stable Head Chefs experienced significantly lower turnover than sites facing ongoing kitchen team changes.
This matters because leaders provide more than operational oversight. They create consistency, develop future talent, strengthen culture, and help teams perform at their best. When experienced leaders leave, the impact extends beyond the individual role.
Replacing a General Manager or Head Chef is only part of the challenge. Leadership changes often trigger wider disruption across the team, causing recruitment costs to increase, knowledge leaving the business and remaining employees facing greater pressure. Ultimately, guest experience can suffer too.
Most hospitality businesses collect employee feedback, engagement scores, and workforce data. The problem is that these metrics often sit separately from operational and commercial performance measures and, as a result, important connections can go unnoticed.
The latest data highlights a clear example. Employee survey participation rates appear to be a stronger predictor of future turnover than engagement scores themselves. When survey participation falls below 60%, employee turnover increases within the following 90 days.
That makes participation rates more than an internal HR measure. They can act as an early warning signal that problems are emerging within a site, before turnover, labour pressures, or guest experience issues become visible. For operators, this creates an opportunity to intervene earlier, while there is still time to influence the outcome.
The findings point to a simple conclusion: General Manager and Head Chef retention should be treated as a core business KPI, not just a people metric.
Most operators already track sales performance, labour costs, and guest satisfaction closely. Leadership retention deserves the same level of attention because it directly influences each of those outcomes. The link between stable leadership, lower turnover, and stronger team performance is now visible in the data.
Participation rates in employee surveys also deserve closer attention. Looking beyond headline engagement scores can help operators identify risks earlier and ensure teams continue to feel heard.
The most effective way to act on these insights is to view workforce data alongside commercial performance data. When labour metrics, employee feedback, sales performance, and operational outcomes are connected, patterns become easier to spot. Operators gain the context they need to make better decisions and take informed action earlier.
Technology has an important role to play here. It cannot replace strong leaders or great teams, but it can help operators understand what drives performance by bringing workforce and business data together in one place. Workforce management platforms, such as Sona, help connect previously siloed systems and provide a clearer view of the factors shaping labour performance.