The Big Story Are restaurants thriving in this economy?
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Feb 16, 2026 Kelly Higginson, President and CEO of Restaurants Canada, speaks about the state of the food service industry and its role in the economy. She discusses falling profitability, rising costs, pandemic debt and trade-related supply shocks. She outlines policy responses like the GST holiday limits and proposals to remove GST on prepared food. She finishes on why Canadians still love dining out.
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Tough Year Ahead Without Temporary Boosts
- Restaurants expect a tougher 2026 as temporary boosts like the GST holiday fade and operating costs rise.
- Consumer pullback on discretionary spending compounds profitability pressures across the sector.
Rising Share Of Unprofitable Restaurants
- Forty-four percent of restaurants were operating at a loss or barely breaking even by November 2025, up sharply from 12% in 2019.
- The sector is the fourth largest private employer, so these losses threaten widespread job impacts.
Lingering Post‑Pandemic Debt Burden
- Many operators entered the post-COVID era carrying high debt from loans, credit cards and mortgages taken during shutdowns.
- Ongoing inflationary pressures have further squeezed margins, making recovery fragile.