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Food Service Industry Updates

Restaurant Association Believes Biden’s Plan Could Do More Harm Than Good

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The National Restaurant Association believes President-elect Joe Biden’s proposed “American Rescue Plan” is laser-focused on defeating the pandemic and restoring the families and businesses that have been devastated over the past 10 months, but the association said the plan may cause more harm than good when it comes to the restaurant and foodservice industry.

“We urge the administration to consider greater inclusion of initiatives like the Senate version of the RESTAURANTS Act,” Sean Kennedy, the association’s executive vice president of public affairs, said in a statement. “Working together, this country can stop the growing number of shuttered restaurants and the millions of workers still without jobs.”

The Real Economic Support That Acknowledges Unique Restaurant Assistance Needed To Survive Act of 2020 (RESTAURANTS Act) follows the form of a recovery fund the association called for in a letter to Congress last March, just days after the industry was forced to shut down. In that letter, the association asked Congress to authorize the Department of Treasury to create a $145 billion Restaurant and Foodservice Industry Recovery Fund to “provide vitally needed immediate access to capital that would allow restaurants to endure.”

Kennedy said the support in Biden’s proposal is overshadowed by the possibility that, at a time when restaurants are spending more to keep their doors open, they may also have to balance a dramatic hike in labor costs. As part of his proposal, Biden wants to raise the minimum wage to at least $15 an hour.

“As the pandemic has highlighted, the economic realities of each state are very different,” Kennedy added. “A nationwide increase in the minimum wage will create insurmountable costs for many operators in states where restaurant jobs are most needed for recovery. And the elimination of the tipped wage could lead to thousands of skilled hospitality workers seeing cuts in their hourly income. Changes in wage policy should be considered by Congress on a separate track from an economic recovery plan.”

Kennedy added that the pandemic has fundamentally changed the foodservice industry, “and we still don’t know how it will look or how much of it will survive.” He said the National Restaurant Association and its members are ready to have a conversation about wage levels in the foodservice industry and the impact any change would have on the economic recovery of both workers and restaurant operators.

“We look forward to working with the incoming Biden Administration and the new Congress to find solutions that can best fuel America’s revival,” Kennedy added. “We appreciate the targeted support for our industry and look forward to learning more about the president-elect’s plan.”

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