A return to normal that will take time to restore

Labor shortage, COVID-19 pandemic and rising food prices: the return to normal for restaurateurs could take longer than expected to return to February 2020 levels, according to a Desjardins economist.

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The year 2020 was thus devastating for the industry, as drinking establishments fell by 58.9%, according to estimates by the Association Restauration Québec (ARQ). Same story for special services such as caterers (-45.5%), full-service restaurants (-40.9%) and those with limited service (-15.7%).

The catering sector has nevertheless changed a lot since the start of the pandemic, with some establishment owners having decided to reinvent themselves to diversify their offer.
This is the case for e-commerce, which accelerated particularly in 2020. The percentage of sales by this means increased from 3.7% to 19.9% ​​between 2019 and 2020 for full-service restaurants.

“We can wonder to what extent this share will decrease when the sanitary restrictions have been considerably lower since the beginning of 2022 and the experience of visiting the dining room will have replaced meals at home”, however noted Joëlle Noreau, senior economist at Desjardins.

Rising prices for food and its packaging which have jumped are also having an impact on e-commerce and delivery. This increase is therefore felt by restaurant customers, who have to pay more for their drinks.

And if the return of tourists and workers can help restaurateurs, the end of government aid programs may be too much trouble and sound the death knell for some of them.

Although the number of catering employees picked up in 2021, it is still not catching up with the level of 2019, representing only 76.3% of employees in the year before the pandemic.

According to the economist, it is “a steep slope to climb”, since the number of establishments has particularly fallen, with one restaurant in five which closed its doors as of April 2022, according to the ARQ .

These difficult conditions have led several restaurateurs to bankruptcy, 242 in 2020 and 200 in 2021. But according to Ms. Noreau, “many entrepreneurs have given up their aprons without going bankrupt.”

“The difficulties in recruiting labor will not be ironed out in the short term. The demographic situation of Quebec, which makes it a population that is aging faster than the Canadian average, will still pose problems of scarcity of workers,” she added.

This situation could last until the end of the decade, according to demographic projections from the Quebec Institute of Statistics.


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