Minimum wage debate reignites after data shows Albertans are spending less at restaurants

Click to play video: 'Wage and business concerns for Alberta restaurants'
Wage and business concerns for Alberta restaurants
WATCH ABOVE: Many restaurant owners have said hiking the minimum wage will hurt their business. Now, new numbers show Albertans are spending less on dining out. Fletcher Kent reports – Jan 24, 2018

Albertans spent less money eating out last October and November than they did in previous months.

The data from Statistics Canada shows Albertans collectively spent $759 million dollars at bars and restaurants in November. That’s $10 million dollars less than was spent in October.

ATB Chief Economist Todd Hirsch said there’s no clear reason for the decline but adds, “We do know that restaurants have been seeing higher costs and they’re pushing those up in their menu items.”

Higher priced food could mean less demand.

“That might be dissuading some Albertans from eating out. They might decide just to stay home and eat instead.”

READ MORE: Alberta restaurants say cumulative effect of ‘hostile policies’ is ‘death by a thousand cuts’

In September, Alberta’s minimum wage jumped from $12.20 an hour to $13.60 per hour. The governing NDP has promised to raise the minimum wage to $15/hr this October.

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Restaurant owners have complained about these increases, saying it will cost them money and they may have to lay off staff or close.

READ MORE: 60,000 job losses by 2019 due to minimum wage increase, says Bank of Canada

Hirsch also pointed out that these declines followed several months of increases.

“Two months certainly doesn’t make a trend so we’ll have to see where restaurant receipts go in the coming months,” he said.

Watch below: Mark von Schellwitz with Restaurants Canada says the minimum wage increase was “too much too fast” for restaurants

Click to play video: 'Minimum wage increases ‘too much too fast’ for restaurants: Restaurants Canada'
Minimum wage increases ‘too much too fast’ for restaurants: Restaurants Canada

Edo Japan is modernizing its stores and expanding. At a party to celebrate Wednesday, franchisee Nelson Rodriguez spoke about the minimum wage increases.

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“It’s a very big concern,” he said. “Look what’s happening in Ontario. I believe it will unfortunately be happening here. Employers will rethink what they’re doing, what they’re giving right now.”

Rodriguez is referring to some Ontario Tim Hortons franchises that have clawed back employee benefits after the Ontario government increased the minimum wage to $14/hr on Jan. 1.

READ MORE: By the numbers: Tim Hortons vs. Minimum Wage Hike

On Tuesday, Labour Minister Christina Gray defended the Alberta government’s plans. She said employees need better wages.

“Making sure that they’re able to put food on the table is important as we continue to support business,” Gray said.

“The increase in the minimum wage is directly impacting families, putting more money in their pockets and allowing them to spend more money in the local economy.”

Standing next to her, restaurant owner Adil Asim said he’s not extraordinarily worried about wage hikes.

“Lettuce prices triple in price three times a year. I could go on and on. This industry is built on challenges. So for them to say this is an insurmountable challenge; bogus,” Asim said.

READ MORE: Love eating out? Expect steeper bills in 2018, new food report says

Edo Japan’s CEO also spoke at the new store launch. He said minimum wage hikes shouldn’t slow his company’s growth, adding Edo has seen higher sales numbers during the same months that Statistics Canada reported overall declines.

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Dave Minnett adds higher labour costs force companies like his to adapt and Edo’s new look and new menu does that.

Industry wide, he said, “I think the future is bright. I think the future is positive but I think the future requires brands of yesteryear and yesterday to continue to evolve.”

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