Unsound business models can only exist for so long -- are all restaurants closing, or just those with extremely small operating margins? If a restaurant is operating on such small margins that they can't raise wages to keep their business open, then it makes sense for that space to be used by a restaurant owner who can run the business more effectively.
I fail to see how this isn't just capitalism and competition working as expected. The majority of restaurants react to this by raising all prices -- including wages. The food costs twice as much now, and they are paying their staff twice as much. If people don't want to pay the price, maybe it's best that a better restaurant takes its place or the restaurant improves their offering?