Survey Finds Restaurants Still Struggling and Need Federal Relief Quickly

The National Restaurant Association called on Congress to pass the $25 billion Restaurant Revitalization Fund as part of an overall relief plan.

  • The National Restaurant Association released data showing 77 percent of restaurant operators reported lower total dollar sales volume in January 2021 compared to January 2020.
  • The Association has once again urged Congress to pass the $25 billion Restaurant Revitalization Fund as part of President Biden’s American Rescue Plan.
  • Texas has reopened indoor dining to 100 percent capacity, while cities like Chicago and San Francisco have raised the allowed limits to 50 percent and 25 percent respectively.

Related: How state and local officials can save restaurants

New data from the National Restaurant Association suggests the restaurant industry continues to struggle in pandemic conditions, prompting the Association to once again urge Congress to pass the $25 billion Restaurant Revitalization Fund as part of President Joe Biden’s American Rescue Plan now being debated in the U.S. Senate.

Meanwhile, some states are lifting or easing restrictions on indoor dining. Texas Governor Gregg Abbott today announced that he will allow restaurants to reopen to 100 percent indoor dining capacity on March 10. San Francisco will allow restaurants to serve indoor diners at 25 percent capacity on March 3, while Chicago will raise capacity from 40 percent to 50 percent. The state of Michigan will also increase indoor dining to 50 percent.

In a letter to Congressional leadership, the Association said recent data shows a continued vulnerability for the nation’s second-largest private sector employer.

“The Restaurant Revitalization Fund represents the culmination of a year’s worth of advocacy and development toward an industry-specific solution,” said Sean Kennedy, executive vice president of public affairs for the Association. “Prompt passage and implementation will provide new relief opportunities for some of the nation’s hardest-hit restaurants and communities. Help for restaurants is help for employees and communities and a signal that our country is one step closer to turning a corner.”

Related: Are sales finally slowing down for Domino’s and Papa John’s?

Highlights of the survey findings include:

  • Consumer spending in restaurants remained well below pre-pandemic levels in January. Overall, 77 percent of restaurant operators say their total dollar sales volume in January was lower than it was in January 2020.
  • From November 2020 to January 2021, nearly 450,000 restaurant jobs were lost, representing about 10 percent of the total jobs recovered during the first six months after the spring shutdowns. Eighty percent of operators say their current staffing level is lower than what it would normally be in the absence of COVID-19.
  • Most restaurant operators do not expect a return to normal business conditions any time soon. Thirty-two percent of operators think it will be seven to 12 months before business conditions return to normal for their restaurant, while 29 percent think it will be more than a year. Ten percent of operators say business conditions will never return to normal for their restaurant.
  • Fourteen percent of restaurant operators say they will “probably” or “definitely” be closed within three months if there are no additional relief packages from the federal government.

While many other industries have moved into a recovery phase, the restaurant industry ended last year in a double-dip recession and with 2.5 million fewer jobs, the Association notes. Between March 2020 and January 2021, restaurant and foodservice sales were down $255 billion from expected levels.

“Demand for relief will far outpace the $25 billion in funding,” Kennedy concluded in the letter. “But this is an incredible step forward, and we look forward to working with you to see this program launch successfully to rescue countless industry jobs nationwide.”