Why No One Goes Out to Eat in D.C. Anymore (a ballot measure that tripled the base wage for tipped restaurant workers)

Misguided public policy has led to fear on the streets and surcharges on restaurant bills

By Michael Saltsman and Rebekah Paxton. Excerpts:

"Rising crime and last year’s mandated increase in tipped wages have restaurateurs lining up to leave town.

In a December social-media post announcing the closing of Pursuit, a 10-year-old wine bar and restaurant, owner Adam Kelinsky said doing business in the city “is no longer sustainable.” Aaron McGovern and Arturas Vorobjovas shuttered both Washington locations of their seafood restaurant Brine in November, saying that the combined effects of the pandemic, the sputtering economy and “the spike in violent crime” had made it “impossible to survive.” Others focus on the second-order consequences of crime: With homicides in Washington up 35% in 2023 and car thefts up 82%, restaurant operators report that people are choosing to eat elsewhere."

"Washington’s restaurants have simultaneously faced a sharp rise in labor costs. In November 2022 the city’s liberal voter base overwhelmingly approved Initiative 82, a ballot measure to more than triple the base wage for tipped restaurant workers. Tipped workers in most states can be paid a lower base wage, with their tips bringing them up to minimum wage or more—often two to three times the required minimum."

"An April survey published by the Employment Policies Institute of more than 100 local restaurants in D.C. found that most planned to lay off workers. Half planned to expand into lower-cost states such as Maryland or Virginia, and nearly 1 in 3 planned to close locations."

"hundreds of restaurants have opted to add fees or other surcharges to customer checks."

"poll of nearly 1,000 D.C.-area adults found more than half are dining out less because of higher prices. Some said they’re choosing to patronize restaurants in Maryland or Virginia instead."

"gratuities are lower for workers in states with higher tipped wages. This seems to be what’s happening in Washington: Local news outlet DCist reports that some servers are earning less in take-home pay despite the higher base wage."