The restaurant industry is grappling with the devastating effects of the coronavirus as cities and states across the country order restaurants and bars to close to prevent the outbreak from spreading.
Industry officials say they understand the public health needs, but warn that many small businesses will not recover from the pandemic without government help.
The immediate impact was already apparent when Americans began avoiding public places to stem the spread of the virus.
Restaurant reservations and walk-ins were down 48% on Sunday from the same time last year and more than 20% since March 10, according to data from OpenTable. In Washington, DC, the drop was 55%, 57% in Los Angeles, 72% in San Francisco and 69% in New York.
But the situation is likely to get worse. At least 20 states have now implemented strict restrictions, reducing seating or, in many cases, ordering restaurants and bars to close completely and only allowing takeout.
In Washington, DC, authorities first implemented restrictions over the weekend limiting gatherings to fewer than 250 people, banning bar or standing room service and limiting seating to six people.
A group of restaurants initially balked at the restrictions but then backtracked after DC Mayor Muriel Bowser promised to bring in the full weight of city agencies to enforce compliance. On Monday, the city took the even more drastic step of closing restaurants and bars and only allowing transportation or delivery.
The various restrictions across the country impact restaurant owners and workers differently, but all face the threat of loss of business and wages.
“In many states, their operations have flipped in less than a day, and the new normal is delivery, drive-thru, take-out, and third-party delivery; in other states it is full service with appropriate social distancing – and in all states this is determined by science, recommendations from CDC and public health officials, and protocols industry security,” an industry spokesperson told The Hill.
Industry officials are pushing for food delivery and takeout to remain an option for Americans to mitigate the damage and provide paychecks to as many workers as possible. But overcoming the epidemic will be a struggle for many companies. The industry spokesperson said 99% of restaurants are family businesses with fewer than 50 employees.
The National Restaurants Association declined to comment publicly on The Hill for this story. A note on their website indicates that the group works with officials.
“The National Restaurant Association continues to engage with local, state and federal officials to help our employers and employees deal with this public health emergency,” the website reads.
Problems in the restaurant industry are capturing the attention of Congress and the White House.
President TrumpDonald TrumpTrump calls Barr a ‘Bushie’ who went to the other side Gas prices soar as support for Russian oil ban grows Barr becomes latest former ally to escalate feud with Trump MORE spoke on Tuesday with representatives of the largest catering companies, according to reports. CNBC said the executives included those from Domino’s Pizza, McDonald’s, Wendy’s, Yum Brands and Darden Restaurants, which includes Olive Garden and Capital Grille among its brands, as well as representatives from the International Franchise Association and the National Retail Federation.
According to the report, executives told the president they would encourage take-out and other options to protect customers. An executive reportedly urged Trump to create a fund to help small businesses like restaurants stay open and keep workers on the job for weeks to come.
Reviews Noted that Trump’s meeting with executives on Tuesday included only those from big business and fast-food chains, with no representatives from smaller restaurateurs.
Help is likely on the way with the Trump administration and lawmakers already working on a third coronavirus bill, which could include $850 billion in stimulus for a variety of industries, a figure put forward by Trump.
“For Congress, we need to think about how we’re going to take care of those workers who are going to feel the impact in the first place,” Rep. jimmy gomezJimmy GomezPelosi backs Rep. Karen Bass in Los Angeles mayoral race Sixteen Hispanic House Democrats demand tougher methane rule from EPA Pressley proposes measure condemning Boebert MORE (D-California), which represents a part of Los Angeles, a city where restaurants and bars are closed.
“What worries me are the people who work in the mom and pop shop, who are all over my district,” he added.
Gomez worked at Subway and Target after high school and said he immediately thought of restaurant workers during the crisis.
“In some cases, direct cash assistance to individuals is appropriate, small zero-interest loans,” he said. “We have to look at this from many angles, otherwise we are going to be in worse shape.”
treasury secretary Steven MnuchinSteven MnuchinInvestigation into secret Russian funding of US anti-fossil fuel groups GOP senators to block vote on Biden Fed picks Tuesday also said the administration plans to send checks directly to Americans over the next few weeks as part of a stimulus package.
But even with lawmakers and the administration at work, restaurant industry representatives and those in related industries are worried about the damage. Some have warned that take-out and delivery services will also see reduced demand and will not be enough to make up any shortfall.
And the impact on the wider economy will be severe. According to The Atlantic, Americans spend more in restaurants than in grocery stores. The industry says foodservice is responsible for nearly 16 million jobs.
Restaurant owners and workers have taken action on their own to minimize the fallout, with many reports of establishments selling gift cards or vouchers to generate revenue now and ensure customers return after the outbreak.
Other groups have also warned of the ripple effects, such as the alcohol industry, which says it will also be hit by restaurant and bar closures.
“This is a very significant and traumatic event for restaurants, bars, taverns and the industry in general. Beer has already seen a steady decline over the past 10 years in these trade channels, which worsens the decline,” Lester Jones, chief economist of the National Beer Wholesalers Association, told The Hill.
Industry leaders have recognized the importance of closing bars and restaurants to keep customers and workers safe.
“The impact on our industry is going to be really, really tough. It’s going to be a real economic challenge not just for distillers across the United States, but certainly for small businesses, restaurants and bars,” said Chris Swonger, CEO of the Distilled Spirits Council of the United States (DISCUS).
But the liquor industry has also been boosted as Americans stock up on groceries and other supplies, bringing them a much-needed boost in sales.
“We got a call this morning and our members, wholesalers across the country, got their trucks on the road this morning and the warehouses are fully operational,” said Michael Bilello, senior vice president of communications and marketing at Wine. and Spirits Wholesalers of America (WWA).
For wines and spirits, restaurant and bar sales accounted for 16.3% of the market in 2019 according to WSWA data, while off-site sales accounted for 83.7%.
The effects on the restaurant industry itself will likely be far more damaging.
“I know closing the restaurant and not getting a salary for even a week is going to be devastating for the workers,” Gomez said. “We should be focusing on the people who are going to feel the impact – the people who really depend on going to work every day.”