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The potential closure of restaurants threatens diners in the capital

The capital of the country is facing potential restaurant closures.

44% of full-service restaurants operating in Washington, USA, reported that the closure of their establishments is 'very' or 'likely' probable by 2025, according to a survey by the Restaurant Association of Metropolitan Washington (RAMW).

Local media WJLA reported on the survey conducted among 217 restaurants in the Washington region from January 24 to February 11 and published the RAMW document, detailing its findings.

The risk of these restaurant closures is due to 'rising costs and increased wages for employees with tips that exceed income', as noted in the survey.

Issues with high costs and declining revenues

Smaller shares of surveyed fast food restaurants and suburban restaurants in Washington warned of possible closures this year - 15% and 23% respectively, according to RAMW.

The survey revealed that almost half of all types of restaurants in the region experienced a sales decline last year. Meanwhile, 62% of respondents earned lower profits.

Costs have become a problem for restaurants in Washington, with 68% facing rising food and drink costs, according to the RAMW survey. More than four out of five establishments expect their costs to increase as the year progresses.

Negative factors and expected cost increases

RAMW in a document published by WJLA claims that the overall survey 'indicates that the industry is massively struggling with declining sales and customer numbers, escalating food costs, large government layoffs, and the ongoing impact of increased wages for tipped employees'.

The survey findings showed that about 49% of restaurants in Washington experienced a decrease in customer numbers visiting their establishments last year, as some residents opted to eat at home to avoid high costs, the survey reported.

Subsequently, restaurants in the city also point to negative influences from the potential introduction of tariffs, new immigration policies, and other business-impacting factors, RAMW reports.

The minimum wage for restaurant workers in Washington will increase by $2 to $12 per hour starting July 1, with the city aiming to make it align with the overall minimum wage in the coming years. RAMW claims that this upcoming change could lead to significantly more restaurant closures.

Warning about the possible transformation of the restaurant landscape in Washington

“Full-service restaurants in our district are gathering places that define neighborhoods and create the cultural fabric of our city. The data shows the accumulation of various issues that threaten not only individual businesses but could also transform the restaurant landscape of Washington,” said RAMW Executive Director Shawn Townsend.

The restaurant industry in Washington

Washington has over 2,600 restaurants and about 66,400 restaurant and culinary positions, according to the National Restaurant Association.

This industry is known to generate a turnover of $7.7 billion in restaurant and culinary service sales.

The National Restaurant Association anticipates that restaurant sales in the US will reach $1.5 trillion this year.