Restaurants ‘under pressure’

Happy hour outings are on Jackie Piggott’s calendar — but even those are fewer.

She and her husband might visit a restaurant once a month. It’s a change over the past year: earlier, they may go twice, thrice or weekly.

“It’s something that we’ve talked about, my husband and myself, just because the pricing is so expensive,” Piggott said, stopping during a grocery run in St. Vital. “It’s also better for our health.”

She’s in the majority: a new Restaurants Canada report found 80 per cent of Canadians are eating out less frequently because of higher living costs, up from 75 per cent in 2025.

It’s unclear whether the trend persists in Manitoba. Seemingly there’s more customers, but the average bill is lesser, according to the Manitoba Restaurant and Foodservices Association.

Restaurants Canada clocked a decline in diners from households with incomes exceeding $100,000: 78 per cent of respondents to an Angus Reid Institute survey said they eat out less frequently this year, compared to 70 per cent in 2025.

“It’s pretty significant when … that middle-class Canadian is having to make those tough decisions and trade-offs,” said Kelly Higginson, Restaurants Canada’s president.

Nationally, 41 per cent of eatery operators are breaking even or losing money. It’s a jump from 12 per cent in 2019, according to Restaurants Canada’s report, which was released this week.

Manitoba restaurants are seeing more sales this year than last. Restaurants Canada is projecting $2.97 billion by the end of 2026, up 7.2 per cent from $2.77 billion in 2025.

“Restaurant spending in Manitoba does still remain under pressure,” Higginson said.

The average Manitoban is spending four per cent less at restaurants than 2019, when adjusted for inflation and population growth, she said.

Sales this year wouldn’t beat 2019, she underscored.

Present day sales “are not necessarily translating into increased profitability,” Higginson added. She pointed to higher operating costs on all fronts.

“The increases have been relentless,” said Kristjan Kristjansson, president of Brazen Hall Kitchen and Brewery.

He’s planning for a $70,000 annual increase to payroll once the minimum wage changes on Oct. 1. It’ll rise to $16.40 from $16; in 2021, it was $11.95.

Kristjansson said paying employees well, and increasing pay, is important. He’s also faced higher costs ranging from beef to carpet cleaning.

Brazen Hall leadership has cut back on research trips abroad and some facility upgrades, such as new seating, to keep up with inflation, Kristjansson said.

“We’ve been on top of it, we’ve done a good job,” he said. “This is not a fight to win. This is a fight to manage.”

Restaurateurs may fail if they don’t raise menu prices or adapt otherwise as input costs rise. The risk is losing customers, Kristjansson said.

“I would say there are less people out,” he said. “People, I think, are socializing differently.”

Older adults are appearing less. Young adults — in their 20s and 30s — are Brazen Hall regulars. Food spending is up, alcohol sales are down, Kristjansson said.

“It’s still kind of evolving,” he said. “I’m sure if … you go back to 2019 and beginning of 2020, it’s a drastic shift, but after these four, five years, it’s not noticeable year to year.”

Across Manitoba, it seems more people are eating out but the average bill is lesser, said Shaun Jeffrey, executive director of the Manitoba Restaurant and Foodservices Association.

“(There’s) additional labour required to meet the demands of that increased guest count with the lower average purchase,” he said. “Additional sales profits are being eaten up in that additional labour cost.”

Some restaurants continue to operate on reduced schedules.

The industry has had years of positive signs and high-profile openings, Jeffrey said. He cited a good atmosphere and value offerings as aspects of a successful new business. Restaurants are leaning more into happy hours, he said.

Thakshila Muthugala, manager of Firehouse Subs St. Vital, echoed the need for a good atmosphere.

The Dakota Street shop opened last year. It’s matching its expected sales forecast, Muthugala said.

Brazen Hall’s revenue has been “almost identical” year over year, added Kristjansson.

Restaurants Canada is forecasting $130 billion in annual restaurant sales nationally.

Manitoba’s sales outcome might be altered by the provincial government’s removal of PST in grocery stores, Higginson said. Restaurants Canada has advocated for restaurants to be added to the list, calling the tax change unfair because grocers sell pre-made meals.

gabrielle.piche@winnipegfreepress.com