EI increase will hurt job creation in restaurant sector

TORONTO, Nov. 8, 2011 /CNW/ - Although Finance Minister Flaherty's employment insurance (EI) announcement could have been worse, it still hits restaurant employers with a $13-million payroll tax increase - a tough pill to swallow in these hard economic times.

"We appreciate that the EI increase could have been double, but any increase at all is bad news for employment in this economy," says Garth Whyte, president and CEO of the Canadian Restaurant and Foodservices Association. "This is especially true for us as a people industry, where opportunities for job creation are the greatest."

"In a nutshell, payroll taxes are an unfair and unnecessarily harsh way for government to raise revenue," says Whyte. "Yes, the increase wasn't as bad as expected, but it will still hurt. We may have dodged a bullet, but we're not out of the woods - not by a long, $13-million stretch."

CRFA is pushing the federal government on behalf of its members to streamline and reform the EI system to ensure low, long-term, stable premium rates. To this end, CRFA is recommending a year's basic exemption in the EI system to make it a more progressive tax for entry-level workers and less punitive to labour-intensive businesses.

Canada's $63-billion restaurant industry employs more than one million people. According to a recent Ipsos poll for Kraft Foodservice Canada and CRFA, 22 per cent of Canadians were first employed by the restaurant industry (making it the number one source of first jobs), and 80 per cent recognize restaurants as a vital source of employment.

SOURCE Canadian Restaurant and Foodservices Association

For further information:

Prasanthi Vasanthakumar, Communications Specialist, 416-649-4254 or pvasanthakumar@crfa.ca

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Canadian Restaurant and Foodservices Association

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