Canadian Pizza Magazine

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No help for foodservice industry in Man. budget


April 14, 2011
By Canadian Pizza

pzcanadianmoneythumbnailApril 14, 2011, Winnipeg – A lackluster provincial budget was further tarnished by the decision to raise Manitoba’s minimum wage for the seventh time in six years, according to the Canadian Restaurant and Foodservices Association (CRFA).

The association warns this is an especially important issue for the province’s restaurant industry, where 30 cents of every dollar goes directly to labour costs.

“Unfortunately the government is pursuing a policy of wage inflation, not job creation,” said Dwayne Marling, Manitoba-Saskatchewan vice-president for the CRFA. “This latest increase will hurt the very people it is meant to help. If the government really wanted to address poverty, they would significantly raise the basic personal tax exemption, not the minimum wage.”

“The province holds up the elimination of the small business tax as the solution to every business owner’s challenges,” Marling continued. “But this is only helpful when businesses are actually making money. Restaurants always work on tight margins, but in today’s economic climate many are struggling with profitability.”

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In a press release, the CRFA noted, “Last year’s 50 cent minimum wage hike, which took effect Oct. 1, cost Manitoba’s restaurant operators an estimated $16 million – or $7,000 per restaurant – in increased labour costs. The hike was six times the rate of inflation (+0.9 per cent). Given this gap, another increase is clearly unnecessary.”

Manitoba’s $1.7 billion restaurant and foodservice industry, which directly employs more than 41,000 people, is one of the largest employers in the province.