Industry Lens: Food Services—October 2021
The Conference Board of Canada,
October 19, 2021
This report examines the short-and medium-term economic and profitability outlook for Canada's food services industry.
- Food services was one of the industries hardest hit by the pandemic in Canada as real GDP fell by 30.8 per cent in 2020.
- But better days are on the horizon—a full recovery is expected by the second quarter of 2022 as provinces continue to ease or eliminate restrictions.
- Real GDP is expected to grow 10.5 per cent in 2021 and 31.2 per cent in 2022.
- Employment is roaring back in the industry as firms rush to replace employees who were laid off during the pandemic.
- The hiring frenzy led to higher job vacancy rates in the third quarter of 2021 as establishments faced difficulties staffing available positions. The slack will be picked up by the middle of 2022 as the industry returns to pre-pandemic employment levels.
- Industry profits plummeted during the height of the pandemic but are poised to return in 2022. In the short term, enhanced sanitation measures will elevate costs while some remaining restrictions will hamper revenues, leading to lower profit margins than before the pandemic.