Typical Day at Grand Central Market in Downtown Los Angeles before the coronavirus pandemic hit. Photo by manmadepants
This is not my typical post – I was working on a piece about the history of real estate in the restaurant industry. This was before the coronavirus (also known as COVID-19) pandemic has caused most of the United States and the world to shut down. While the stimulus bill of $2 trillion dollars has passed (find out more here : https://www.politico.com/news/2020/03/25/whats-in-stimulus-package-coronavirus-149282) and will provide handouts to individuals and loans to businesses, many businesses have been affected and many individuals have lost their jobs. This coronavirus pandemic has likely set off a long-lasting recession. The restaurant industry is one of the most vulnerable since many people are staying at home in a bid to “flatten the curve”. Dine-in service has been banned all over the US to minimize the coronavirus spread. The reason for this is because viruses like the coronavirus infect on an exponential curve if there is no interference such as stay at home mandates. This can easily overwhelm the hospital industry as the rate of hospitalization would become much higher than what the healthcare industry can actually handle. With interferences such as stay-at-home mandates and social distancing, the rate of hospitalization would not be as high since more people staying at home means there is lower chance of getting COVID-19 and spreading it to others. See more on the coronavirus outbreak and its spread through Washington Post’s coronavirus simulator (https://www.washingtonpost.com/graphics/2020/world/corona-simulator/). It is so heart-breaking that restaurants and bars have to close for dine-in services, but it is necessary to prevent the spread of coronavirus.
With dine-in services banned, many restaurants are forced to pivot to pick-up and delivery services, while being mindful of social distancing. Photo by Tony Webster
The California Restaurant Association (CRA), a powerful restaurant lobbying group, is stating that there is a chance that 30% of California’s restaurants will permanently close. I think the percentage is most likely higher than that since restaurants are barely struggling to break even with the transition to take-out and delivery services. With the rate of unemployment skyrocketing in a matter of two weeks, more and more people definitely are not opting for take-out or delivery services.
Per the Department of Labor’s data (https://www.dol.gov/ui/data.pdf), the unemployment rate has jumped significantly in March. Over 6.6 million US workers filed for unemployment benefits in the last week of March. For comparison, only 282k workers filed for unemployment benefits during the week of March 14. It took less than two weeks for the coronavirus pandemic to cause such a devastating effect on the economy.
Credits to DorsaAmir (https://www.reddit.com/r/dataisbeautiful/comments/fpga3f/oc_to_show_just_how_insane_this_weeks/). Source data is also provided in the link.
Even Cheesecake Factory has announced to its landlords that it cannot pay April rent, so one can only imagine how many small mom and pop restaurants are reeling from this pandemic. Some restaurants have closed altogether as they determined that delivery and take-out services made no sense – some were barely breaking even and the increased risk of getting the coronavirus to break even on take-out/delivery services made no sense.
This is a time where everyone should be kind and help one another any way you can. For those struggling, there are many resources being provided to those who have been affected such as The Lee Initiative, which is a Kentucky based restaurant relief program founded by restauranteur Ed Lee. Backed by grants from Maker’s Mark and other companies, the Lee Initiative is working to provide free meals and essentials to restaurant workers impacted throughout many cities. For example, Nancy Silverton’s Chi Spacca in Los Angeles provided free dinners for two weeks in March to laid-off restaurant workers thanks to the Lee Initiative. It has since shifted to Sqirl, a popular Los Angeles brunch spot. Sqirl will offer free dinners for the next few weeks until otherwise stated.
I donated to the Lee Initiative because it is heartbreaking to see so many of my beloved restaurants and bars closed and people suffering. I’ve also donated to a couple of Gofundme relief funds that will go towards employees of specific bars I frequent. I do want you to do what you can to help out, whether it is donating to causes you support if you still have a steady paycheck coming in, sewing face masks to donate, or even getting groceries for any elderly in your neighborhood. Any small act helps. We’ll get through this and restaurants will rebuild again.
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