What is restaurant labor cost?

Restaurant labor cost is the total amount of money that a restaurant spends on wages for its employees. The average restaurant labor cost as a percentage of revenue is between 20 and 30 percent. The majority of a restaurant's labor costs are typically spent on front-of-the-house staff, such as servers, bartenders, and hostesses. Back-of-the-house staff, such as cooks and dishwashers, also make up a significant portion of a restaurant's labor costs.