25,000 Sask. food service sector jobs lost due to COVID-19: survey

COVID-19 has cost Saskatchewan's food service industry 25,000 jobs since March 1, according to a Restaurants Canada survey.

The industry association pegs the nationwide loss at 800,000 — and it's feared many of the jobs lost amid mass business shutdowns may never return.

Nearly one in 10 restaurants in Canada have already closed permanently because they cannot pay operating costs due to a lack of cash flow during the pandemic, according to the survey. Restaurants Canada polled 655 food service operators across Canada — representing more than 13,000 locations — between March 25 and 29 for the survey.

More of those operators will likely have to close as public health orders limiting large gatherings and which businesses can open continue. In Saskatchewan, restaurants can currently only offer take-out or delivery.

Dale MacKay—co-owner of Grassroots Restaurant Group, which oversees three restaurants in Saskatoon and one in Regina — has temporarily shut down all services and laid off all employees.

While he is expecting to reopen his restaurants, MacKay worries about the effect food service sector closures will have not only on employment, but on the culture of Saskatchewan.

"When the hospitality industry goes down it does have a trickle-down effect on a lot of things. It's not just jobs," MacKay said.

"Hospitality takes on a lot of real estate and employs a lot of people. And so when you lose all that ... you're losing your culture and you're losing your sense of community."

MacKay says many food service sector businesses operate on modest profits, which are relied on to support the owner, their family and a small staff.

"To me, a business like that can only take two or three months of hardship and then they're done. And that in itself is very scary given the fact that those businesses are all over our streets in Saskatoon, Saskatchewan, and in Canada," MacKay said.

Leanne Bohay, co-owner of Naked Bean Espresso Bar and Cafe in Regina, shares the same concerns as MacKay. She temporarily shut down her café three weeks ago and laid off all her employees.

While she is optimistic she can reopen once physical distancing rules are lifted, Bohay says Regina will be a very different city in six months.

"Local businesses just are the heart of our provinces. And the franchises will be the franchises," she said.

"I'm hoping [the government] will kick in with something. My family is my staff. For all the small businesses out there ... it's the same."

Expanding subsidy measures

The federal government recently announced a 75 per cent wage subsidy for small and medium-sized businesses that have seen a drop in revenue of at least 30 per cent during the pandemic.

But Restaurants Canada has found that its members are more concerned about receiving government support once they are permitted to reopen.

"Urgent additional relief is required to help these businesses survive or there will be fewer jobs for the thousands of temporarily laid off restaurant employees to return to," said Mark von Schellwitz, the industry group's Western Canada vice-president.

MacKay says that while he is pleased with federal government's new 75 per cent wage subsidy, more support will be needed to help the service industry recover.

"At the end of the day ... it's not really going to save them," said MacKay.

As most restaurants have laid off their employees and there is no revenue coming in, businesses are not yet in a place to take advantage of the 75 per cent wage subsidy, he said, and a larger stimulus package is necessary to support the industry.

"I think [the wage subsidy] is going to need to be extended after the reopening given the fact that that's when we're really going to need it ... when we're going to be firing up our workforce again and rehiring the people we laid off, or new employees," said MacKay.

"That's when we're really going to need it ... not right now."

The organization is also calling for the expansion of the qualifying conditions for the wage subsidy, as well as the time period for businesses to access it. That, the organization says, would help restaurants keep their workers on payroll and allow them to rehire those they had to lay off.

On Thursday, the Saskatchewan NDP called on the federal government to provide emergency grants for small businesses experiencing cash flow issues.

The provincial Opposition party also called for protections for small businesses, including a moratorium on evictions and foreclosures, and measures to support the forgiveness or deferral of payments on loans, business leases and contracts.