Wooden table with napkins and condiments at completely empty rustic restaurant with now people and customers during covid 19 coronavirus pandemic shut down. (Photo: Volodymyr Rozumii, Getty Images/iStockphoto)
While the restaurant industry in metro Detroit has been up and down with reopenings being announced amid some closings, nationwide the overall industry is still in peril.
It’s been six months since many restaurants across the country first shut down because of the coronavirus pandemic.
Now, a restaurant industry trade group, in a survey released on Monday, estimates that a staggering 100,000 restaurants, or nearly 1 in 6, across the country have shuttered permanently or for the long term in those six months.
The National Restaurant Association called its latest survey findings “startling.”
With the closures, the trade group said nearly 3 million employees are still out of work.
The six-month impact of the pandemic on restaurants found 40% of operators saying that without additional federal relief aid packages “they are unlikely to stay in business six months from now” and don’t expect things to improve, the report said.
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“For an industry built on service and hospitality, the last six months have challenged the core understanding of our business,” Tom Bené, President and CEO of the National Restaurant Association, said in a news release. ” … . Across the board, from independent owners to multiunit franchise operators, restaurants are losing money every month, and they continue to struggle to serve their communities and support their employees.”
In a letter to Congress and the Trump administration, the association asked them to use bipartisan support to pass small business programs in stand-alone bills. In July, the association developed a “Blueprint for Revival” outlining what’s needed to help the industry. The blueprint includes enacting a second installment of the Paycheck Protection Program (PPP), creating a restaurant recovery fund and a long-term loan program. In addition, the blueprint outlines what the group says is needed for stability in the food supply chain.
The survey also found:
- Consumer spending remained below normal in August, with sales down 34% on average.
- The food service industry lost $165 billion in revenue and is on track to lose $240 billion this year.
- More than half (60%) of operators say total operational costs (as a percent of sales) are higher than prior to the COVID-19 outbreak.
- Restaurant operators say current staffing levels are only 71% of what they would typically be without COVID-19.
- In an August consumer survey, the association found 56% of adults are aware of a restaurant in their community that permanently closed during the pandemic.
The new survey shows, said Sean Kennedy, executive vice president of Public Affairs for the Association, that time is not on the restaurant owners’ side.
“The ongoing disruptions and uncertainty make it impossible for these owners to plan for next week, much less next year,” he said in a statement. “Congress is about to leave Washington for the elections — we need them to focus on the short-term, basic solutions that have secured bipartisan support and passed one or both chambers. We urge immediate passage of these while we work with lawmakers on the comprehensive elements of our ‘Blueprint for Restaurant Revival.’ “
Kennedy cited that the food service industry is the largest private sector employer in the country, pumping more than $2 trillion into the nation’s economy up until the shutdown.
“Making an investment in an industry that consumers love and that powers the economy is a good business and economic move for Congress as they search for the biggest bang for their recovery buck,” Kennedy said.
Contact food writer Susan Selasky: 313-222-6872 or [email protected]. Follow @SusanMariecooks on Twitter.
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