Restaurant and bar sales in this country have surpassed their pre-COVID-19 levels for the first time since the pandemic began, according to Statistics Canada.

However, an industry group warned that with inflation on the rise, many restaurant operators are still barely scraping by.

New data released Tuesday shows Canadian restaurant and bar sales increased by 6.5 per cent monthly in March to $6.8 billion. Year-over-year, sales were up 35 per cent compared with March 2021, 62.9 per cent compared with March 2020 and 4.9 per cent higher than March 2019 before the COVID-19 pandemic.

The increase in restaurant and bar sales in March of this year occurred as pandemic-related restrictions eased across the country. Ontario saw the largest increase in dollar terms, while Manitoba saw the biggest percentage increase.

However, the increase in sales also coincided with surging inflation and rising food costs across the country. Prices for restaurant food were up 5.4 per cent in March 2022 compared with March 2021, according to Statistics Canada, while prices for alcoholic beverages served in licensed establishments increased 3.6 per cent in the same period.

鈥淲hile sales are up, restaurants are also facing higher operating expenses,鈥� said Chris Elliot, senior economist for the industry group Restaurants Canada.

Elliot said in response to a Restaurants Canada survey conducted April 5 to April 15, six out of 10 restaurant operators in Ontario said their businesses are still losing money or barely scraping by. He added while Canadians have been dining out in greater numbers this spring, many in the industry are worried those numbers will decline as more households feel the bite of inflation.

鈥淲hile there has been an initial boost in sales due to pent-up consumer demand, we may see a moderation in spending during the summer as a result of the rising cost of living,鈥� Elliot said in an email, adding the same survey identified food costs, labour costs and shortages, and supply disruptions as the greatest challenges facing restaurant operators.

According to Restaurants Canada, before the start of the COVID-19 pandemic, Canada鈥檚 food service sector was a $95-billion industry that directly employed 1.2 million people. During the more than two years of pandemic and varying levels of public health restrictions on in-person dining across the country, the industry lost hundreds of thousands of jobs and billions of dollars in sales.

In a news release last month, the industry group said it continues to call for extended loan forgiveness and repayment to aid in the food service industry鈥檚 revival.

鈥擳he Canadian Press