COVID-19: The hospitality industry is facing an uncertain future
Restaurants are taking a hard hit due to COVID-19. The National Restaurant Association estimates the industry will lose $225 billion this year, while 5 to 7 million workers could end up unemployed. Food services and drinking establishments make up an increasing proportion of GDP, from 1.76 percent in 1997 to 2.23 percent in 2018.
Last year, eight percent of the U.S. workforce worked in food services, primarily restaurants and bars. That accounts for more than 12 million people.
With orders in place that only allow takeout or delivery, restaurants in many cities are struggling to deal with the new normal. Ken Kaufman is the owner of two restaurants in Culver City, California – Rush Street and City Tavern. Between the two establishments, he has over 100 employees.
Kaufman says his primary concern is how his employees will fare during this uncertain time. When the directive was issued shutting down sit-down dining, Kaufman was faced with tough decisions that would affect his workforce. “Beyond the concern about their economics is the concern about having to work together in an environment that may be a danger. So I had no desire to put my staff in harm’s way either,” says Kaufman.
He opted to close both restaurants. To help his workforce, Kaufman made sure that his employees understand how to file for unemployment benefits. Kaufman notes that Culver City has created a recovery committee to address the issues facing local business.
He says, “I’m very much a part of that and talking to the Council people. I love Culver City. So for me, let’s withstand a little bit of pain for the actual business. But let’s all group together, share the pain, and we’ll be okay. I want to be optimistic and I want to care for my employees most of all.”
Hospitality and travel industries hard-hit by downturn