Industry expects 10,000 restaurants to close in next 3 months

Industry expects 10,000 restaurants to close in next 3 months
Posted at 3:21 PM, Dec 07, 2020

There is arguably no industry in the US that has been harder hit by the coronavirus pandemic than restaurants. A combination of restrictions placed on restaurants and public health experts advising the public to avoid restaurants has resulted in a decline for many eateries.

The National Restaurant Association said it expects that 10,000 restaurants will close in the next three months, based on a survey of its members.

The National Restaurant Association is hoping to get some additional relief from Washington. Last week, a bipartisan group of legislators put forth a stimulus bill that would include additional funding for the Paycheck Protection Program, which helped businesses make payroll early in the pandemic.

"In short, the restaurant industry simply cannot wait for relief any longer," said Sean Kennedy from the National Restaurant Association. "We appreciate the efforts of a group of moderate members of the House and Senate to advance a true compromise between the competing proposals from Democratic and Republican leaders. If this moderate plan represents a 'down payment' for a larger relief package in early 2021, it will provide restaurants with immediate relief to hold on through the most dangerous point in our business year."

While restaurants are having receding revenues, restaurant costs are not declining, and in some cases, increasing, according to the National Restaurant Association’s survey. The survey found that 58% of full service restaurants are expecting to furlough or layoff additional employees over the next three months. That’s with 89% of full service restaurants already operating at below pre-pandemic staffing levels.

The National Restaurant Association says that 17% of bars and restaurants fully closed either permanently or temporarily in November due to the pandemic.

"What these findings make clear is that more than 500,000 restaurants of every business type—franchise, chain, and independent—are in an economic free fall," said Kennedy.

The restaurant industry is a major factor in the US economy. The National Restaurant Association says that 15.6 million jobs are tied to the restaurant industry spread across over 1 million locations.

Public health experts have warned that indoor dining is problematic as masks cannot be worn while eating and drinking.

“It’s clear when you do contact tracing about where you get these outbreaks, it’s bars, indoor seating at restaurants, particularly at full capacity,” Dr. Anthony Fauci said last week in a Facebook conversation with Colorado’s governor. “When you’re in a restaurant, it’s very tough to eat with a mask on unless you figure out something I don’t know about.”