Restaurant Industry Surviving Despite Difficult Holiday Season
HALIFAX–It wasn’t a great holiday season for the Nova Scotia restaurant industry. Just before the Christmas rush could begin, the Omicron variant swooped in and canceled a lot of plans–and a lot of revenue.
Consumer confidence also plunged as confirmed Covid-19 cases went up. Restaurants also had to deal with new restrictions, including being forced to stop service at 11 p.m. and close by midnight–a rule that likely helped kill a lot of potential New Year’s Eve business.
“Pretty much a dud,” said Luc Erjavec of Restaurants Canada about New Year’s Eve in Nova Scotia. “Takeout business was quite good (however).”
Struggling restaurants did get a life raft from the federal government, at least, just before Christmas. On December 22 the feds loosened their criteria for pandemic-affected businesses to get financial supports.
Now, a business only needs to show a revenue drop of 25 percent or more in the previous month to qualify. The government is also offering financial support to businesses that are locked down or have been forced to operate with a capacity limit of at least 50 percent.
“Thank goodness the federal government stepped in and realized they had problems with their support programs and changed the definition of lockdown to include a 50 percent capacity limit,” said Erjavec. “That saved our bacon; pardon the pun.”
“I don’t know how we would have survived, or how we will survive, without that.”
Restaurants Canada and other business organizations were critical of the federal government back in October when it announced wage and rent subsidy programs were ending. Programs created to replace them were much stricter: a business had to show a revenue decline of 40 percent to receive funding.
Restaurants Canada did a survey that suggested 80 percent of restaurants wouldn’t meet the criteria.
The tough news, however, is that, for now, the relaxed criteria is set to expire on February 12 and it’s not clear how much longer business will be financially suffering from Covid19.
“Right now, it’s time limited–let’s see how things progress. Things seem to change daily and weekly. Then we’re really going to have to look t how we rebuild consumer confidence,” Erjavec said.
Erjavec added that, with fewer people going out to restaurants and the new restrictions (half capacity, no more than 10 to a table, with tables having to be six feet apart, restricted hours) it’s impossible for many restaurants to make a profit.
“It just hinders your ability to run a viable business-the math just doesn’t work.”
Erjavec said that, other than in the early days of the pandemic, when in-person dining was completely shut down, these are the toughest measures restaurants have faced.
“Other than closure, it doesn’t get much worse,” he said. “You have six-foot social distancing plus capacity limits. We never had that before; this is as tough as it gets. Throw in the restrictions of hours and restrictions on table size–other than closure this is as tough as we’ve had it.”
Erjavec is calling on all levels of government to have a “do no harm” policy for small businesses when they make tough decisions on issues like tax increases, minimum wage policy, and even setting the price of alcohol (which Erjavec said is due to increase soon).
But there is an even bigger problem facing restaurants right now: with so many people having to stay home or isolate due to Covid protocols, most places are short-staffed. Some places have even had to close due to a lack of available workers.
“The real challenge is just staffing our restaurants right now,” said Erjavec. “There are so many people who are close contacts or have been deemed a necessity to isolate, that we just can’t find staff. Many restaurants have been closed because of the difficulty to find staff.”
Erjavec estimated that, in the week leading up to Christmas, nearly half of all restaurants in Downtown Halifax were closed, with staffing issues playing a major role.
The issues facing restaurants reminds him of what the industry first faced two years ago.
“It’s going to be a long, tough, road to come back,” he said. “De ja vu all over again.”
Derek Montague is a Huddle reporter in Halifax. Send him your feedback and story ideas: [email protected].