Diana's Gourmet Pizzeria is Here to Stay!

There seems to be a misunderstanding about an article in the Winnipeg Sun that I was quoted for a few weeks ago.
The article was about the upcoming minimum wage increase to $9.50 per hour. In addition to co-owning Diana’s Gourmet Pizzeria, I’m also on the Board of Directors for the Canadian Restaurant and Food Association (CRFA) and as such I was contacted by a reporter for the Winnipeg Sun to comment on the fifty cent increase to minimum wage and what effect that would have on the restaurant industry.

Part of my comments were in regards to what our company needs to do in order to remain competitive – which is to cut hours off of our schedule or to increase sales substantially. The former is easier, the latter is difficult to do in the best of times, never mind in the current economic conditions. Since the article was in the paper, many restaurants have already raised their prices as a result of the government’s decision. I was also expressing my outrage that the day after the NDP government announced the wage hike, they have the audacity to ask all the unions for a 2 year wage freeze ‘due to economic difficulties’. Apparently this government doesn’t think that businesses have been living through those same economic difficulties and therefore could (and should!) also benefit from wage freezes. I might find the hypocrisy amusing, if it wasn’t going to add $16,000 to my payroll.

The other part of my comments were in regard to independent restaurants in general, the truth being that many would close their doors because they’re unable to absorb another fifty cent wage increase in addition to increases for all other input costs. The restaurant industry operates on very slim profit margins, typically between 2-5% and almost all independent restaurants are operated by the owners. It would seem that some people think that all small business owners are evil, greedy and are cutting ourselves million dollar cheques, when in fact, most of us work side by side our staff, putting in longer hours and often without a paycheque. We come in when employees call in sick, we pay thousands of dollars into EI for our employees, yet as owners we aren’t eligible for the same benefits, like maternity leave.

There are 500 fewer restaurants in Manitoba today than 10 years ago, that’s one restaurant a week shutting down. I have personally met many of the families behind these closings and can tell you first hand that many of them have sunk all their life savings in their dream of owning a restaurant, only to discover that this industry requires an incredible amount of work and has an insatiable appetite for cash. I often say that the restaurant industry is the easiest business to get into, the hardest to stay in and the most difficult to make a profit.

Many people posted comments online, almost half of whom were ill informed of the facts. Some people wrote things like ‘it’s only fifty cents’, not doing the math correctly. It would ‘only be fifty cents’ if it was only one employee, who only worked for one hour each payroll. I don’t know any businesses, big or small that have one employee working one hour every pay period.

What wasn’t in the article was the fact that many of my staff already make more than minimum wage, they’ve been with us a while and have mastered the skills needed to work with us AND that is reflected in their wages. We all can’t fathom paying a new hire the same wage as the trainee – and everybody needs training, people no longer come with skills. This means that we need to have a trainer teach the new guy that just running cold water over a dirty dish isn’t actually ‘doing the dishes’. It may surprise you to know that it costs an average of $1500 - $2500 to train a new employee and also not all employees work out. In the more than 12 years that we’ve owned our business we have worked with many great people, but we’ve also had to let people go for not showing up (or only showing up when it’s convenient for them), not treating our customers right, not treating other staff members right, stealing, poor work ethic, closing early, damaging equipment and a host of other things I’d rather not get into. This is the reality of owning a business these days and when the government decides to increase minimum wage it increases the cost of training while devaluing those same skills required for our industry.

Some people misread the article and comments and then incorrectly assumed that Diana’s Gourmet Pizzeria is closing down – which is not true. We are well established, well known and have a loyal clientele for which we are very grateful for. Most independent restaurants are not as fortunate, and as a director for the CRFA I spoke up on their behalf. Someone needed to.

For the record, I strongly disagree with the government induced inflation. Raising minimum wage does nothing to lower poverty rates, if it did, we would have seen positive results within the past 3 years while minimum wage has increased 33%. There is no data to support the argument that raising minimum wage lowers poverty rates; in fact there is evidence that shows just the opposite. Raising minimum wage is a ploy to look good for the voters; however it is really increasing taxes for the minimum wage earner. What we should all ask for, what would make a difference for everyone, is to increase the minimum taxation level. That way, every Manitoban with an income will get a raise. Some Manitobans will spend all their money, others will invest part and spend part, others will save part and many will donate more to charities – and all this will stimulate the economy. The government will collect more taxes from the increased spending and we the people would get to enjoy more of the money we earn. It’s a win-win-win situation.

Should you happen hear a rumour that Diana’s Gourmet Pizzeria is closing, please set the record straight with the facts taken directly from the top; we’re not going anywhere. We have adjusted our hours of operation and are now closing one hour earlier, however you’ll still find us open for lunch and dinner each and every day.