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Why companies will be giving out free pizza and bagels forever


As companies started to woo workers back to the office after the darkest days of the pandemic, they often turned to that most time-honored of inducements — free food. Think bagels in the morning, pizza for lunch and any and all kinds of snacks throughout the day.   

But now that more businesses are making the return to the office mandatory, is all of that complimentary grub still on the table?

A new report suggests yes. EzCater, a platform that connects businesses with restaurants for their catering needs, found that 83% of companies said their budget for employee food was at the same level or higher than in the pre-COVID era, based on a survey of 600-plus individuals responsible for workplace ordering. And 86% of companies said that their food offerings were helping encourage employees to work onsite.

Admittedly, ezCater has a vested interest in seeing companies embrace the food-as-inducement idea. But it’s not the only one taking note of all this chowing down. In a 2022 study, the Society for Human Resource Management (SHRM) found that company spending on snacks and beverages for employees has increased by 20% since 2019.

What’s driving this corporate buffet boom? Lots of factors, say human-resource and other corporate-culture experts.

86% of companies said that their food offerings were helping encourage employees to work onsite.

Begin with the basic allure of free food, a concept that drives even those with the biggest of salaries to stop and pay attention. That very idea was woven into the aptly named “Free Food for Millionaires,” Min Jin Lee’s critically acclaimed novel that looked in part at corporate life.

When the concept is applied to companies trying to convince their workers to return to the office, it takes on broader meaning. Offering food is not just about the grub; it’s about using those breakfast bagels and pizza lunches as a way to restore the element of camaraderie missing in our work-from-home lives.

“I think it’s a symbol of togetherness,” says Jeff Williams, a vice president of Paychex, the payroll and HR-solution company.

Plus, it’s a relatively cheap perk for a company to provide, experts note. The price of a few dozen — or even a few hundred — sandwiches is nothing compared with such core and costly benefits as medical insurance or retirement funding.

Of course, providing employees free food is hardly a new idea. Long before the pandemic, many companies served the occasional meal or snack — or, at the very least, free coffee. And some tech companies built their reputations on their food offerings and some other wacky perks (foosball tables, anyone?).

Ironically, it’s some of those same companies that have pulled back on the food and other perks of late, according to media reports that have cited such tech giants as Google parent Alphabet
GOOGL,
+0.81%

and Facebook parent Meta
META,
-0.84%

making cuts. The changes come at a time when these and other tech firms are facing economic pressures and laying off people. (Officials with Alphabet and Meta didn’t respond to a MarketWatch request for comment.)

The decision to cut back on the food may be more a symbolic move than a significant money-saver, says Peter Cappelli, director of the Center for Human Resources at the Wharton School. In effect, Cappelli says the trimming is so that employers can demonstrate these are hard times and show investors they are taking the matter seriously.

“When they have to act tough, the free coffee goes away,” he says.

But Cappelli also says that perks like free food are still bound to be offered in a tight job market like the one we’re in. Despite those tech layoffs, the unemployment rate is currently 3.4%, its lowest level in more than a half-century.

‘Take that [free] bagel away, and there will be mutiny.’

Which means many employers need to do all they can to keep and attract good workers — hence, the free sandwiches. (And sandwiches remain the most popular choice of food offered to employees, according to ezCater, followed in order by Mexican food, Italian food and breakfast items.)

Still, that raises the possibility that the corporate buffet could come to an end if the employment picture changes. And other factors might also affect the status of free food. If anything, employees might see the perk as relatively insignificant compared to those more costly benefits they truly value, says Holly Norton, a human-resources business consultant with Strunk HR, a company that provides employment-related services.

“You’ll hear [people] saying, ‘Keep your snack and put it to the 401(k),’” she says.

But David Meiselman, chief marketing officer of ezCater, argues that we’re seeing a permanent shift in the corporate culture, and the sandwiches and other food items are here to stay. He points not only to ezCater’s growing sales — the company’s orders increased by 87% in 2022 — but also to the fact that hybrid work arrangements appear to becoming a fixture in the American workplace.

A Pew study from 2022 said that nearly six in 10 employees who can work from home are doing so at least most of the time. In Meiselman’s view, free food will remain a crucial “draw” to get workers into the office.

Meiselman also says the free-food idea builds on itself: As the perk becomes more established, there’s an assumption it will always be there. And companies that try to do away with it could face pushback from hangry employees, he and HR experts say.

“Take that bagel away, and there will be mutiny,” Meiselman says.



This story originally appeared on Marketwatch

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