Hotel operators forecast bleak prospects as COVID-19 surges
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A survey by the American Hotel & Lodging Association of its members found that seven in 10 say they won’t make it another six months without further federal assistance given projected travel demand.
Even more hotel operators said they’ll be forced to lay off more workers. And the holidays, usually a busy time for hotels, won’t help this year as many families stay put with COVID-19 continuing to surge.
Back in February, Brent Underwood was getting ready for South by Southwest in Austin. He owns a 20-bed hostel there and was booked solid. Then, COVID-19 hit and he suspended operations.
“Effectively, we are out of business,” he said. “The business has been shut down; the property is for sale.”
It’s not just mom-and-pop hotels feeling the crunch. The Marriotts and Hiltons of the world operate some hotels, but they also franchise out a lot of them to independent owners.
Alex Susskind at Cornell said as in most sectors, “the larger companies are probably in a little bit better shape than some of the smaller ones.”
He said there’s likely to be some consolidation of property as a result of the pandemic.
Still, Michael Noel at Texas Tech University said eventually, boutique hotels will rebound.
“There will be a time where that hotel will reopen, because the demand is going to come back,” Noel said. “But not every business owner is going to survive and be able to raise the capital to start it up again.”
But he said nothing will get back to normal in the hotel industry until COVID-19 is under control.
COVID-19 Economy FAQs
Are states ready to roll out COVID-19 vaccines?
Claire Hannan, executive director of the nonprofit Association of Immunization Managers, which represents state health officials, said states have been making good progress in their preparations. And we could have several vaccines pretty soon. But states still need more funding, she said. Hannan doesn’t think a lack of additional funding would hold up distribution initially, but it could cause problems down the road. “It’s really worrisome that Congress may not pass funding or that there’s information circulating saying that states don’t need additional funding,” she said.
How is the service industry dealing with the return of coronavirus restrictions?
Without another round of something like the Paycheck Protection Program, which kept a lot of businesses afloat during the pandemic’s early stages, the outlook is bleak for places like restaurants. Some in the San Francisco Bay Area, for example, only got one week of indoor dining back before cases rose and restrictions went back into effect. Restaurant owners are revamping their business models in an effort to survive while waiting to see if they’ll be able to get more aid.
How are hospitals handling the nationwide surge in COVID-19 cases?
As the pandemic surges and more medical professionals themselves are coming down with COVID, nearly 1 in 5 hospitals in the country report having a critical shortage of staff, according to data from the Department of Health and Human Services. One of the knock-on effects of staff shortages is that people who have other medical needs are being asked to wait.
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