British Columbia’s restaurant industry is pressing the province for help, warning that sector is stumbling under a perfect storm of challenges.
The B.C. Restaurant and Foodservices Association and Restaurants Canada say the sector employs more than 185,000 workers and generates $18 billion annually in sales.
But amid lingering debt from the COVID-19 pandemic, high inflation, labour shortages and government regulations, more than half of B.C. restaurants are unprofitable, according to the group.
More worrisome, the sector has seen bankruptcies climb by 48 per cent in the last 10 months and nearly one in five could close in the next 18 months due to pandemic-related debt, the organization warns.
“They are trying to stay alive, but they have all this regulation,” BCRFA president and CEO Ian Tostenson said.
“We’ve got to find solutions that are practical, that don’t cost a lot of money to the taxpayer and we get on with it.”
Kalen McNeil, president of Vancouver Island’s’ Big Wheel Burger, said restaurants have always faced tight margins, but now face numerous challenges stacked on top.
Those include inflation, the need to pay back Canada Emergency Business Account (CEBA) loans, inflation and the effects of the housing crisis on staff retention.
“It’s kind of like five or six things coming at us at once,” he said.
“It is a delicate balance between getting real support without sounding like we are complaining, people will have to pay a bit more if they want their favourite restaurant to survive.”
The restaurant industry is proposing a variety of measures it says could help businesses stay afloat.
Near the top of the list is the creation of a provincial Ministry of Hospitality to coordinate government regulations and supports.
Currently, the industry is overseen by the ministries of tourism, finance, attorney general, small business and labour.
“Neither one of those ministries, no fault of their own, they don’t speak to each other,” Tostenson said.
“This is like having an orchestra without a conductor. So the opportunity here is a minister of hospitality for an 18 billion industry to help us coordinate this.”
The industry’s campaign is also taking aim at permitting backlogs, calling for harmonized liquor licensing, a streamlined process for patio approvals and for clearly-defined approval times for licences.
It also wants to see tax changes, including raising the threshold for the Employer Health Tax from a payroll of $500,000 to $750,000; rebates for energy, packaging, rent and municipal tax hikes; a freeze on WorkSafeBC premiums and provincially-led debt relief.
And it wants help with the staffing crunch, in the form of a provincial ‘jobs nod’ program that offsets the cost of hiring new staff along with the creation of a tourism and hospitality stream for foreign workers.
“Our process to get a foreign worker in B.C. takes about eight to nine months — in Alberta it takes four months,” Tostenson said.
“We’re saying what’s the reason behind this? It’s just backlog.”
In a statement, B.C. Jobs Minister Brenda Bailey said the province understood the challenges the industry is facing, but wouldn’t commit to any of the changes the sector is proposing.
“It’s clear the labour shortage and housing crisis continue to make it hard for restaurants to find the workers they need, and we will continue to get more homes built faster, and to work with industry to support hospitality workers,” she said.
“Our government continues to have ongoing conversations with the sector and are aware of the various concerns and requests that are being brought forward and will continue those conversations.”
Bailey touted the province’s COVID-19 grants to businesses, along with other measures including caps on restaurant delivery fees and relaxed liquor policies as ways her government has tried to help the sector.
McNeil, however, said more is needed.
“We’re not getting rich, we’re just looking to survive,” he said.
“It’s really sad to see restaurants go.”
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