(TheIndependentStar.com) – America’s economic issues on President Joe Biden’s watch are taking a heavy toll across the board, with restaurants being hit hard, especially in Democrat-run California, where are grappling with the burdens of stringent state regulations and pervasive inflation, according to a report.
Throughout the current year, numerous acclaimed eateries such as Manzkes’ Bicyclette and Patrick’s Roadhouse have ceased operations, as detailed in a report by the Los Angeles Times on Wednesday, cited by The Daily Caller.
The industry anticipates facing further economic challenges due to imminent state regulations, including a rise in minimum wage and enhanced employee benefits requirements.
Reflecting on the industry’s status at the beginning of 2024, the situation echoes the significant number of closures experienced in 2023, particularly in Los Angeles, where over 65 restaurants were reported closed.
The rising cost of ingredients and supplies, exacerbated by inflation, has placed additional strain on businesses such as the Vietnamese restaurant Bé Ù, where costs have surged between 35% and 50% since 2021.
Nationally, prices have escalated by 19.3% since January 2021, with a notable 3.4% increase over the past year ending in April.
“Vendors do not hesitate to raise their prices regularly on products,” Uyên Lê, owner of Bé Ù, explained to the LA Times.
“And we are often very reluctant to pass those heavy costs on to our guests … I am sure you understand considering the sticker shock most of you probably experienced at the grocery store lately,” he added.
Furthermore, the high cost of gasoline in California, where it is notably more expensive than elsewhere in the U.S., has compelled establishments like Bub and Grandma’s Bakery to increase delivery fees and consider outsourcing delivery services to mitigate expenses.
“There are thresholds that, once they go over that, people aren’t going to pay $12, $15 for a single loaf of bread,” Andy Kadin, the bakery’s owner, stated to the LA Times.
“I hope we don’t get there. If we do, we’re going to have to get very creative and have to do more with less,” he said.
Recent regulatory changes have introduced a new minimum wage for chain restaurants, escalating the hourly rate from $16 to $20 as of April 1.
This adjustment prompted significant layoffs, particularly noted by a prominent Pizza Hut franchisee.
Anticipated regulations set to commence in July will prohibit surcharges on employee tips and enforce provisions for health insurance and other benefits.
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