We Don’t Want to End Up Like the U.K
With new round of coronavirus closures, N.J. Gov. Murphy says. A day after officials in United Kingdom announced the country is rolling out a new round of coronavirus restrictions after an uptick in cases, Gov. Phil Murphy called on New Jersey to remain vigilant against the pandemic so the state doesn’t suffer the same fate. “Look, by the way, at what’s happening in the United Kingdom, where cases have been rising and restrictions are now back in place,” he added. “I desperately hope we don’t have to do that here.” “And the more we keep with our new routines,” Murphy continued, “the better our chances are that we keep our numbers low and dropping, and we keep moving forward. So, let’s do it.”
Restaurants Need to Brace for 18 More Months of Extreme Challenges
And the election is about to make things worse. Nearly 100,000 restaurants have closed across the US since the pandemic began, according to the National Restaurant Association. That’s roughly one in six of all restaurants across the country. And according to the association, 43% of full-service operators say it is unlikely their business will still be open in six months if conditions created by the coronavirus pandemic do not improve. Unfortunately, experts say that actual improvement is a long way off. Heading into the fall, restaurants will face new hurdles, including reduced unemployment benefits, colder weather, and people skipping on dining out because of the election.
Restaurant Buyers Fleeing to the Suburbs from the Cities
Are you kicking or sticking? Calls are coming in from restaurant, and bar owner/operators from New York City, Philadelphia, Jersey City, Hoboken, and the like. ‘Get me out of the city. What do you have for sale in the suburbs of New Jersey,’ were the essence of many of these calls. They had had enough. The pandemic was much worse in the densely populated metropolises, than in the suburbs. ‘I am looking for a safe place to live and to take care of my family; to start all over again,’ one caller uttered. Now, with outdoor dining coming to an end and occupancy limited to 25% indoors, New Jersey restaurant owners have a decision to make: (i) Do we sell at a ‘market-sensitive’ price or; (ii) do we hang in, pump more money into our businesses and endure to at least the end of 2021 to see if sales figures can match or exceed those from 2019.
“Reopening” Isn’t Enough to Save Bars and Restaurants
The US needs a bailout. The federal government needs to be much freer with bailout money, and in exchange demand more restrictions on how bars and restaurants can operate. Right now bailout-phobia is damaging the economy and public health at the same time — with no real upside other than making the labor market statistics look superficially better. That emerging world of higher unemployment, higher prices, and reduced choice isn’t the one anyone wants. But all current American policymakers are doing to support the sector is encouraging risky public health behaviors.
Can Ghost Kitchens Bring Restaurants Back to Life?
Some say ghost kitchens are a solution. Many restaurants are starting to see the benefits of ghost kitchens, especially during the pandemic. Pre-coronavirus, 15% of operators reported using a ghost kitchen, according to research by Restaurant Business sister company Technomic and the National Restaurant Association. By May, an astounding 51% had turned to ghost kitchens for some or all of their delivery orders, Technomic found. “I would say that 60% of the restaurant industry pre-COVID-19 was kind of in an elementary school phase” in terms of understanding how off-premise works, said Jim Collins, CEO of Kitchen United, on an August webinar hosted by The Food Institute. “What COVID-19 really did is it forced us all to go to graduate school.”
NYC’s Restaurants Fear 25 Percent Indoor Cap
Means ‘Armageddon’. Starting on Sept. 30, New York City eateries, from cafes to buffets, will be permitted to start serving food indoors again after a six-month ban. But industry insiders say the 25 percent cap on patrons instituted to protect people from the coronavirus isn’t enough for owners to pay their workers without government aid, especially when the city’s expanded outdoor dining program ends next month. “If outdoor dining ends and we are only able to offer indoor dining at 25 percent, we will end up going out of business. This is Armageddon for the restaurant industry,” said Nahid Ahmed, co-owner of Luthun, a small, tasting-menu-only restaurant in the East Village. “We cannot get through the winter with only 25 percent unless there is some sort of government assistance.”
A Running List of NYC Restaurants
That have permanently closed, September 2020. More than six months into the coronavirus pandemic, restaurants across the city continue to close in mass. Between March 1 and September 1, Eater documented close to 150 restaurant and bar closures — a mere fraction of the pandemic’s toll so far, which the New York Times estimates has claimed at least 1,000 eating and drinking establishments so far. Among them are neighborhood favorites like Uncle Boons and Maison Premiere, along with sites of teenage debauchery like FiDi’s China Chalet and the glitzy McDonald’s flagship store off Times Square. In all likelihood, though, this is only the beginning of permanent closures in New York, as loans from the Paycheck Protection Program run dry, rent payments continue to mount, and plans for a return to indoor dining remain unclear.
Did You Know?
Seven in 10 operators say off-premises sales represent a higher proportion of their total business compared to pre-coronavirus levels. Twenty-seven percent of operators say they added third-party delivery, while 17% added in-house delivery. Three percent of operators say they added a drive-thru option since March. Among the restaurant operators that added any of these off-premises options, a majority say they plan to continue offering it after COVID-19 passes. As a result, 71% of operators say off-premises sales currently represent a higher proportion of their total business than they did prior to the COVID-19 outbreak. While this doesn’t come close to making up for lost on-premises sales for most restaurants, it provides a potential opportunity to help stay afloat until the coronavirus clouds part.
Jobs that could grow during the pandemic and recession. No one really knows the extent to which the coronavirus pandemic will affect the nation’s economy or when the recession that it triggered will end. Steven Mnuchin, the U.S. treasury secretary, says it could be over by year’s end. Others, such as the economists at the UCLA Anderson Forecast, say it could drag on until 2023. What is certain, health officials say, is that the virus remains a threat — and will continue to affect the labor market for the foreseeable future. Statistics kept by the federal government and by employers suggest some kinds of jobs may be more recession-proof than others. Also promising: Some companies are aggressively hiring to cope with a surge in demand as consumers’ buying habits have changed during the pandemic.
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