2023 Alberta budget: A missed opportunity to address the province’s foodservice sector affordability challenges

Alberta’s restaurant sector appreciates the province’s focus in the 2023 budget on alleviating skyrocketing inflationary costs, and its commitment to responsible fiscal management. However, Restaurants Canada believes the budget failed to address and offer support for the industry’s challenging economic road to recovery.

The greatest challenge facing Alberta’s foodservice sector has been the steep increase in inflation, which has resulted in a 15 per cent rise in business input costs, while menu inflation has been limited to six per cent to avoid passing this increase on to value-conscious guests. The sector is also grappling with labour shortages, with nearly 18,000 vacancies in food and hospitality – a number that has more than doubled from pre-pandemic levels. These factors, combined with restaurants having to pay pandemic-related debts have left half of all foodservice operators operating at a loss or just breaking even.

Introducing sector-specific support is critical to prevent labour shortages from becoming a long-term crisis. “With our sector holding the highest vacancy rate of 10 per cent, double the industrial average, we’ve seen owners and operators implement major changes to their businesses in response to the crisis; 77 per cent of have increased wages, 72 per cent have had to increase hours worked by staff to cover holes in schedules, and another 64 per cent have had to reduce hours of operations due to a lack of staff,” said Mark von Schellwitz, Vice-President, Western Canada. “We are now looking to Alberta’s provincial government for additional help” added von Schellwitz.

Though Alberta’s budget does offer some solutions to the daily operational challenges facing foodservice businesses in the province, Restaurants Canada was looking to see more targeted sector support including:

• Additional provincial programs and tailored training initiatives to alleviate Alberta’s foodservice sector’s acute labour shortage and help the industry recover from the pandemic;
• A VLT operator commission rate increase from 15 per cent to 18 per cent following Saskatchewan’s lead as announced in their 2022 budget;
• and asking the provincial government to encourage Alberta municipalities to adopt consistent Single-Use Item (SUI) standards across jurisdictions and harmonize waste management practices to avoid implementing a patchwork of different packaging bylaws that increase red tape and add to the operating costs of restaurants.

We are encouraged to see that combatting inflation is a primary goal and theme in the 2023 Alberta budget, putting more money back into the hands of Albertans, however, Restaurants Canada will continue to strongly advocate for sector-specific solutions that work to alleviate financial pressures, red tape and address our industry’s labour crisis. Restaurants Canada looks forward to continuing to work alongside the Alberta Government to keep local businesses, and specifically those within foodservice alive.