Story at a glance
- About a quarter of restaurants will not reopen post-pandemic.
- This is largely due to the negative economic shock that has shuttered eateries across the country, resulting in layoffs and revenue loss.
Due to the coronavirus pandemic forcing closures of multiple nonessential businesses and mandates that most Americans stay home, approximately 25 percent of U.S. restaurants will go out of business, Steve Hafner, the chief executive officer of Booking Holdings’ OpenTable and Kayak, told Bloomberg.
When surveying roughly 20,000 restaurants for online and phone reservations and walk-in customers, reservation software company OpenTable found that the total amount of walk-in diners and reservations were down by 95 percent on May 14 when comparing year-over-year data.
The restaurant industry has been demolished by coronavirus-related closures. The National Restaurant Association reports that eating and drinking places lost 5.5 million jobs in April, citing data from the Bureau of Labor Statistics (BLS), further stating that restaurants have lost about three times more jobs than any other industry during the coronavirus-induced recession.
Bloomberg further writes that restaurants have lost more than $80 billion in revenue during March and April collectively.
One positive trend the OpenTable report noted was growing signs signaling that patrons are willing to dine out again in states that have opened restaurants up to a limited capacity, such as Texas, Arizona and Virginia.
However, even if they are legally allowed to reopen to the public, some restaurants have opted to wait.
“Restaurants are complicated beasts,” Hafner told Bloomberg. “You have to order food and supplies. You have to make sure you’ve prepped the kitchen and service areas to be easily disinfected.”
Hafner also stated that for some restaurant workers who have been laid off, unemployment benefits result in better pay than working reduced hours at a restaurant. Coupled with reservations still notably lower than year ago rates, the economic incentive to reopen some eateries is weak.
Editor’s note: This story was updated at 1:30 pm ET on May 15 to clarify where the figure about 25 percent of restaurants closing came from.
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