Ontario’s hospitality businesses are “approaching a disaster” in the face of coming minimum wage hikes, according to an industry leader.

Tony Elenis, president and CEO of Ontario Restaurant, Hotel and Motel Association, told BNN on Wednesday the provinces small business tax cuts won’t be enough to curb the effect of a 32 per cent minimum wage hike over the span of 18 months.

“The hospitality industry has felt betrayed by government on the speed of the minimum wage as it moves forward,” Elenis said. “[Tuesday’s] economic statement was an opportunity for the government to support the industry, especially the small business community. We have not seen anything that would be able to be positive at all.”

“The impact is tremendous and we’re approaching a disaster in our industry and in the small business community,” Elenis said.

Ontario Finance Minister Charles Sousa announced a cut to the small business tax rate to 3.5 per cent from 4.5 per cent on Tuesday in an effort to offset rising minimum wages, but did not back down from his commitment to do right by those seeking out their first jobs.

"We want to help young people find meaningful employment," Sousa said Tuesday. "To find their first job, or take their first steps towards building their career. And we want to support small businesses that hire these young people."

Elenis says 39 per cent of all hospitality workers earn minimum wage and predicted the move to $15 per hour will result in 10-12 per cent price increases to consumers as of this coming January and an additional, identical raise in January 2019. He also said it will result in payroll cutbacks and closures within the hospitality industry.

He believes that a move away from personnel and into automation will be one of the factors determining which hotels and restaurants are best able to weather the storm.

“The ones that survive are the ones that understand the business better but also bring technology and automation into place, which we are already seeing,” he said.

Elenis added that the unforeseen runoff effect of the hike will further challenge hospitality businesses in the province.

“It’s not just about the minimum wage, it’s about payroll burden,” Elenis said. “Pensions, WSIB (Workplace Safety and Insurance Board), the cost for employment insurance and the cascading effect from the supply chain which we are already seeing...Ontario is not an easy province [in which] to prosper.”