Debunking False Narratives About D.C. Restaurant Job Trends

Last week, the D.C. City Council Committee on Executive Administration and Labor held a six-hour hearing to get feedback from employees and restaurants on how the city’s tip credit elimination law is affecting them.

Dozens of tipped restaurant workers testified saying the law – Initiative 82 – was hurting their livelihoods and hurting the city’s dining scene. EPI also testified to the Bureau of Labor Statistics data showing the District had lost restaurant jobs under the law.

Yet pushback from several parties questioned this notion, suggesting D.C.’s losses were part of a larger regional trend and even saying D.C. didn’t lose any restaurant jobs as a result of the law.

These claims don’t stand up to the data.

Comparing D.C. to the larger metro area, which includes nearby Alexandria, Arlington, and parts of Maryland, shows the nation’s capital is taking a uniquely negative turn compared to its neighboring communities.

In the year following Initiative 82’s implementation (May 2023-2024), D.C. lost 3.5% of its full-service restaurant employment.

  • Comparatively, the larger Washington metro region (Washington, Arlington, and Alexandria) excluding D.C. lost just 0.7% of full-service restaurant employment during this same period.

Comparing this to the year before Initiative 82 went into effect, the difference between D.C. and its neighboring region is even more pronounced. From May 2022 to 2023, D.C. gained 15.3% in full-service restaurant employment.

  • Comparatively, the larger Washington metro region (Washington, Arlington, and Alexandria) excluding D.C. gained 7.5% of full-service employment.

Using a difference-in-differences approach, the District’s full-service restaurant employment growth dropped nearly 19 percentage points under Initiative 82 from the previous year, more than doubling the losses for the larger DMV region’s full-service restaurant employment (8.2 percentage points).

Several other speakers in the hearing made claims that D.C. restaurant employment has increased. These are also not true:

One speaker claimed that D.C. added jobs between March 2023 and March 2024. This doesn’t bear out in the data: BLS seasonally-adjusted data still shows full-service restaurant jobs in D.C. fell over this chosen period by -3.5%.

Another speaker cited a March 2024 New York Times article to claim D.C. did not lose jobs because of Initiative 82. reporter Priya Krishna issued a correction to her article when it was pointed out she misread the Bureau of Labor Statistics data for national numbers instead of D.C. numbers.

Unfortunately the correction is still misleading: it cites the employment level for the entire leisure and hospitality industry – which includes much more than just full-service restaurants (for example, it includes fast food restaurants, hotels, and other arts and entertainment businesses where employees are not affected by tip credits).

Upon further review of available government data, the effects of Initiative 82 are still clear: D.C. has lost thousands of restaurant jobs as a result of the city’s attempt to eliminate the tip credit.