Joe Biden’s administration will go down in history more for its memories of death and destruction rather than building anything back better. One example the Trump presidential campaign should hammer the Biden presidential campaign over is the restaurant industry. Some say that the restaurant industry is as much as 5% of our gross domestic product (GDP) or just under one trillion dollars annually. Economic forecasters predicted earlier this year that for the first time in history the industry would top that one trillion dollar mark but that prediction now appears to be in jeopardy.
There are many variables that lead to restaurant chain masse closures but two that came up most researching this article is the Democrats legislation inflating the minimum wage to unsustainable heights and the inflation as it relates to the cost of goods and logistics to move those goods to market.
“Trade Group Finds 10,000 Fast Food Jobs Lost Since New $20 Minimum Wage Law” – California Globe
The Michigan Restaurant & Lodging Association (MRLA) conducted a survey this spring that found the following:
- Sales are down with only one-in-four restaurants experiencing sales growth over the last year.
- Despite significant cost inflation driving up menu prices, 45 percent of restaurants have experienced decreased topline sales over the last year.
- 60 percent of restaurants reported having less customer traffic than a year ago.
- 40 percent of restaurants are not profitable right now.
- 55 percent of restaurants are operating without adequate staffing.
- 57 percent of operators experiencing workforce challenges is being impacted by an affordable housing shortage.
- Nearly 60 percent of restaurants are operating with fewer hours or days as a result of inadequate staffing.
- 89 percent of operators have experienced commodity inflation over the last 12 months of greater than 5 percent.
- 75 percent of those restaurants reporting being profitable currently say they are less profitable now than they were a year ago.
- 70 percent of restaurants in Michigan believe the operating environment over the next 12 months will be worse than today.
- Only 9 percent of operators believe that the operating environment will improve.
ABC’s “Shark Tank” star Kevin O’Leary ($400 M) has come out more and more voicing his concerns over the national economy as he sees it.
“’Destroyed by Big Pharma’ – Kevin O’Leary on Why Restaurants Are Shutting Down Across the Country” – Valuetainment
While some restaurants are closing due to high crime in large urban areas, most of the blame consistently goes to the $20 an hour minimum wage laws passed in liberal states like California. An In-N-Out Burger place went out of business in California after crime went out of control while a McDonald’s went out of business after 30 years of doing business due to the state’s new minimum wage law.
“Fast-Food Wage Hike Laws Blamed for Closures and Job Cuts” – Inc.
Mainstream media journalists demonstrate an amazing lack of curiosity as to what is behind these phenomena of sudden closures of multiple storefronts of major franchises. What should frighten every single American is the abruptness of how these closures are coming about.
“Pizza Hut Abruptly Closes 15 Locations And Over 100 More Could Be Next” – Delish
CONCLUSION:
In the video of Benny Johnson at the top of this article, he takes a moment to get on his soap box and go off on the “Marxist Democrats” who have caused this problem after they were warned in advance these masse closures would be the result of an exorbitant minimum wage hike. Benny is not one to get that emotional but I think he made his comments after watching a number of TikTok videos of Hooter’s waitresses crying after finding out they were suddenly out of their jobs one recent morning.
As a big fan of the podcaster Benny Johnson, nothing he says of his criticism of the Democrats is wrong or untrue. I, too, saw this coming as I reflected back on my youth as a teen in high school and college.
In high school and college I worked my fair share of what we called “sh*t jobs” for minimum wage. I am going to date myself when I say I started at $1.75 an hour and some of those jobs actually involved cleaning up horse, human, and dog feces (horse stable, public park district, and dog kennel). Back then it was understood that these jobs were not meant to be life-long careers but rather just the first rung on the ole career ladder of life.
High school and college kids were the labor force to the managers of these establishments. When I worked at a golf course, I worked with Mexicans who educated me on their way of life and how a dollar here was like ten dollars down there so they would send money home to family. Hey would live their lives up here together in relative squalor or what many would call abject poverty. I admired them for their devotion to family and ability to make do with the minimum by living in community together.
“Major Restaurant Chains That Have Closed Down Locations Across The U.S. In 2024” – Forbes
I was born with the curiosity of a cat and the question I keep coming back to is this:
“Are the Democrats trying to destroy America intentionally, or are they really just that stupid they can’t foresee anticipated results to their actions even when experts try to give them a heads up before they act?”
I did not understand former President Donald Trump’s recent Las Vegas surprise announcement to make restaurant server tips tax-free if he is elected president again. Now I think I see where he is coming from. Lower minimum wages for restaurant operators and change tips to become tax exempt for servers. Brilliant!
Copyright © 2024 by Mark S. Schwendau
