Nearly 100,000 restaurants are closed either permanently or for the long term — nearly 1 in 6, according to a new survey by the National Restaurant Association.
Meanwhile, the number of workers being hired back in the hospitality and leisure industry has been getting lower and lower over the past couple of months. And almost 4.5 million jobs still haven’t come back.
Three of Tracy Vaught’s four restaurants in Houston are open.
“I’m going to hang on,” she said. “I’m going to hang on no matter what.”
They are only open at 50% capacity, with reduced menus and hours. The last one though, has been closed for six months.
“It’s located in a hotel downtown in the convention district near the sporting arenas and a concert venue,” Vaught said.
She said it can’t stay closed much longer, so she’s going to try to open it up next month and see how it goes.
“For a lot of restaurants, even when they are shut down, they’re still paying fixed costs, they’re still paying rent, they’re still paying utilities, they’re still paying insurance,” said Sean Kennedy with the National Restaurant Association.
Kennedy said eight weeks of financial support in Paycheck Protection Program money that ran out months ago has not been enough. Yelp reports 31,000 restaurants on its platform have closed, the majority permanently.
But restaurants have not been entirely helpless, points out Justin Norman, vice president of data science at Yelp.
“There are actually many businesses that have found a lot of new ways to innovate,” Norman said. That includes focusing on delivery, selling meal or cocktail kits, dining outside — though that option that will disappear in northern states as temperatures fall.
Expect more innovation, said David Portalatin, industry adviser for the NPD Group.
“We are going to start seeing a different kind of restaurant emerge in the future,” he said.
However you slice it, Portalatin said, the United States will end the year with fewer restaurants than it began with. And it’s the larger chains that are more likely to survive.
COVID-19 Economy FAQs
With a slow vaccine rollout so far, how has the government changed its approach?
On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
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