The Journal Gazette
Thursday, July 23, 2020 1:00 am

Restaurants in dire need of welcoming back diners

PAUL WISEMAN | Associated Press

WASHINGTON – Restaurants helped revive the U.S. economy after the Great Recession of 2007-09.

This time? Don't count on it.

As the nation struggles to rebound from a now-resurgent coronavirus, restaurants seem much less likely to deliver an economic boost. They've suffered a heavy blow from lockdowns and occupancy restrictions, and it's unclear how readily Americans will return en masse.

Just when eateries of all categories and price levels had been anticipating a summertime comeback, new viral cases are upending everything.

Chris Shepherd, owner and executive chef of Underbelly Hospitality in Houston, said in an online essay that he might have to close his four restaurants because his company's revenue is just 30% of what it was a year ago.

“I employ 200 people in this community,” Shepherd wrote. “When I shut down, they lose their jobs. I'm no longer able to pay my farmers, cleaning companies, valet companies, linen companies, wineries, distilleries. Our reach is long.''

Before the pandemic, restaurants had employed 11 million workers nationwide – more than the number who work in construction or in factories that produce high-priced manufactured goods. They generated more revenue than grocery stores. From 1990 through February this year, restaurant jobs grew more than twice as fast (91%) as overall jobs (40%).

“The restaurant industry's role in the economy is outsized compared to its share of overall GDP,” said Mark Zandi, chief economist at Moody's Analytics. “As it is often among the first jobs for many workers, it is critical to the training of the American workforce. It is also a vital source of jobs and incomes for lesser-skilled and educated workers.''

The struggles in the restaurant industry also disproportionately hurt Black and Hispanic workers. Together, they account for more than 40% of restaurant jobs, versus 30% of overall U.S. jobs.

As restaurants and bars reluctantly closed dining rooms, their sales sank from $66 billion in February to $30 billion by April – the lowest such total, adjusted since inflation, since 1983. In June, boosted by delivery and takeout customers, sales rebounded to $47 billion. But many restaurants desperately need to reopen their dining rooms.

“You cannot profitably run a takeout-delivery model if you also have 60 dark tables in the front of the house,” said Sean Kennedy of the National Restaurant Association.

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