DC Restaurant Workers Hit By 10 Straight Months of Job Losses, Closures Reach Two-Year High

KEY FINDINGS

• Full-service restaurant workers have lost jobs every month in 2024 compared to last year. 
• 70% of restaurants have cut hours, laid off staff, or stopped hiring to reduce costs. 
• Full-service jobs are declining 2% to 6% monthly while quick-service grows.
• DC restaurants face double the sales decline of suburban locations (16% vs. 8%). 
• A record 64 restaurants have closed to date in 2024.

District restaurant workers have been hit by 10 straight months of job losses, marking a deepening downturn that’s also shut down 64 restaurants to date – surpassing 2023 and 2022’s closures. 

“This is a restaurant community fighting through extraordinary pressures,” said Shawn Townsend, President and CEO of the Restaurant Association of Metropolitan Washington (RAMW). “Even our most established operators are struggling to survive as diners decline and wages and payroll taxes soar.”

DC restaurants are experiencing a dramatically steeper decline than their suburban counterparts. In the District, profit margins have plunged to less than half of pre-pandemic levels — with more than four out of five restaurants reporting decreased profitability.

Full-Service Workers Hit Hardest 

Full-service restaurants are shedding jobs at an alarming rate, with employment falling at least 2% each month in 2024 compared to last year, according to the US Bureau of Labor Statistics. August saw the steepest decline at 6%, coming directly after July's two major labor cost increases: Tipped wages rose 25% and the District Paid Family Leave tax nearly tripled.

A new survey of RAMW members shows the scope of job losses and escalating pattern of cuts across all positions. While 70% of restaurants have reduced staffing overall (up from 64% in April), the impact varies by role:

• 30% have laid off bussers, food runners, hosts, and other support staff.
• 24% have laid off servers.
• 91% of restaurants have cut servers’ hours.
• 88% have reduced kitchen staff hours.
• 88% have decreased hours for support staff.

As of October, full-service workers lost 1,900 jobs* since their recovery peak in June 2023. The losses disproportionately affected the full-service industry, as their jobs fell a monthly average of 4%, while quick-service restaurants maintained a modest employment growth of 2% to 4%. 

“The loss of full-service restaurant jobs should concern everyone who cares about economic opportunity,” said Townsend. “We're not just losing jobs, we're losing opportunities. These positions consistently provide earnings well above minimum wage – double, triple, or more – through tips. That's harder to replace than many realize.”

*Because of seasonal hiring patterns, full-service restaurant jobs typically peak between the months of June and August. 

Profits Drop as Costs Keep Rising, Sales Keep Falling

Restaurants face intensifying pressures of rising costs and falling demand. The impact has been severe, with more than four in five restaurants (81%) reporting decreased profits. Margins have plunged to just 6% – less than half of pre-pandemic levels – as the District endures a record wave of closures. To date 64 restaurants have shut down in 2024, surpassing both 2023's total of 53 and 2022's 48 closures. Restaurants report widespread operational challenges:

• 85% face higher labor costs.
• 70% experience higher food costs. 
• 53% report  higher occupancy costs. 

At the same time, menu price increases have not kept pace with mounting costs. Although 70% of restaurants have raised prices, the average 9% increase falls short of rising expenses. These price changes have coincided with weaker demand, exacerbated as the District enters its fourth year of reduced downtown workers:

• 70% of restaurants experience a decrease in summer sales compared with 2023. 
• 75% report less customer traffic.

Declines Are Double in DC Than Suburbs

The challenges are particularly acute in the District, where restaurants are experiencing roughly double the declines of suburban counterparts. Among businesses that report declines in revenues and customer visits, suburban restaurants report an average 8% drop in sales while DC businesses face a 16% decline. Customer traffic shows an even starker contrast: a 20% plunge within the District versus 9% in the surrounding counties. 

"As a group, we are no longer profitable in DC," said one multi-unit operator in the survey. "Our locations in other jurisdictions have remained profitable, but given the decrease in foot traffic and increase in cost of goods and labor, it is extremely difficult for small independent operators to be profitable in the city.”

“The numbers tell us what our members already know," said Townsend. “Every lost job and every restaurant closure represents lost careers, reduced tax revenue, and another vacant storefront in our community. 

“We need solutions that address both immediate pressures and long-term sustainability.”

About the Survey

The survey of 158 restaurant members was conducted online Sep. 18 to Oct. 14. Respondents were mostly casual full-service restaurants (64%) and independently owned and operated (97%). 

About RAMW

The Restaurant Association of Metropolitan Washington (RAMW) is the regional trade association representing restaurants and the foodservice industry in the Washington, DC Metropolitan Area. Established in 1920, RAMW is an advocate, resource and community for its members. The Association works to promote and sustain the growth and development of the industry while providing its members legislative and regulatory representation, marketing and small business support, programming and events. RAMW strives to serve its members with professionalism and integrity, and provide them the training, education and support they need to grow a successful business.

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