Almost a third of restaurants in California have closed permanently due to the pandemic



Almost a third of California restaurants have closed permanently and two-thirds of workers have at least temporarily lost their jobs as the pandemic struck over a year ago and Governor Gavin Newsom imposed the first statewide lockdown, a legislative committee reported on Tuesday.

According to the California Restaurant Association, few industries were more affected than the restaurant industry, which before the pandemic included more than 76,000 food and beverage establishments employing 1.8 million people.

But with the shutdown, as many as a million of those workers were quickly laid off or laid off, the association told the Senate Special Committee on Pandemic Emergency Response.

“COVID-19 has changed all of our lives, but its impacts have been felt most acutely in the restaurant industry,” said Democratic State Senator Josh Newman, who heads the committee and chaired the hearing on the matter. ” It is clear that recovery will take time. “

Employment in restaurants is still down by a quarter from before the pandemic, according to the latest figures from the national employment development department.

Industry executives said they fear the shortage of workers will close more establishments as the economy reopens.

The state initially shut down non-essential businesses, although it allowed dining establishments to continue offering take-out. Its color-coded tier system for reopening the economy then allowed restaurants to offer outdoor seating or indoor dining at different capacity levels as coronavirus cases subsided. .

With fewer infections, increased vaccinations, and a positivity rate of less than 1%, officials say California is on track to lift most remaining restrictions on June 15.

Still, many restaurants are struggling to serve customers already licensed within current capacity limits due to understaffing, the committee said.

Prospective employees may be able to make ends meet with unemployment and federal stimulus benefits instead of returning to work, he said in his report. Some may fear for their safety during the pandemic, while others may wish for “more stable career paths” after being repeatedly fired.

“Right now, we’re just starting to feel that tightening,” said Matthew Sutton, the California Restaurant Association’s senior vice president for government affairs and public policy.

Without providing details, he said lawmakers may want to use some of the state’s massive budget surplus to create an incentive program for employees to return to work. Other witnesses on the committee said they hoped for more direct help, whether in the form of tax incentives or tax breaks.

The sector is expected to eventually rebound, the restaurant owners association reported, creating an additional 160,000 jobs by 2029, for a total of nearly 2 million statewide.

“This is a two to three year takeover,” Kevin McCarney, founder and CEO of Southern California restaurant Poquito Más, told the committee. In the meantime, restaurateurs have said they need to recoup income they lost as their fixed costs like rent and insurance continued.

“It’s not a given that we’re going to survive,” said Laurie Thomas, executive director of the Golden Gate Restaurant Association and owner of two popular restaurants. “We’ve all been digging so much in the last 15 months.”

In the absence of clarification from the state during the reopening on June 15, she fears that restaurants will be allowed to return to full capacity only with vaccinated customers, leaving their staff to become “the new identity police” supposedly. check immunization cards – a role she and others have said they couldn’t handle.

Several witnesses expressed frustration with the state’s changing closure rules or lack of information on assistance programs, although Greg Dulan, owner of Dulan’s Soul Food Kitchen in Los Angeles County, said that the state-funded Great Plates food delivery program had saved his business during the pandemic.

Abrupt shutdown orders from health officials did not give restaurant owners time to cut jobs or distribute food, drinks and other supplies they had just acquired, said witnesses during the hearing.

In retrospect, the state lacked evidence to support its decision to close outdoor restaurants and that rationale “was not effectively communicated,” said Dr Matt Willis, Marin County public health official. , although he said the evidence of virus transmission during indoor meals was much clearer.

With no time to collect data on the risk of outdoor contact transmission, health officials had to use their best judgment at the time, but now understand that the risk of outdoor transmission is low, said Willis and an executive at the California Conference of Directors of Environmental Health. director Justin Malan.

“We may not have had all of the right answers … but remember, this was a new coronavirus,” Malan said. “We didn’t have a plan to answer this.”

Restaurants have said they have adapted to a new business model on the fly during the pandemic.

They could offer curbside or off-site deliveries, or expand into outdoor spaces like patios, sidewalks, parking lots and closed streets with local approval – innovations that can stay for a while. time.

Some adopted disposable menus or those that customers could see on their smartphones. And Sutton said restaurants improvements to their indoor airflow and filtering will stay in the long run.

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