Here’s an experiment:
Imagine you have to go the bathroom really bad. You are walking and see this sign at the end of the all. Glance at it quickly. Do you go right or left?
I went right. Obiously, the arrow is right below Restroom—immediately adjacent, almost touching—so it must be to the right, right? No. It’s to the left. This is the sort of sign you have to read from top to bottom to understand.
If the person doing the letters had put one empty panel between the arrow and the word Restroom, this would not be confusing.