California restaurants could take years to recover from pandemic

SACRAMENTO, Calif .– Almost a third of restaurants in California have closed permanently and two-thirds of workers have at least temporarily lost their jobs as the pandemic took hold more than a year ago and Governor Gavin Newsom imposed the first statewide lockdown, a legislative committee reported on Tuesday.

Few industries have been more battered than the restaurant industry, which before the pandemic included more than 76,000 restaurant establishments employing 1.8 million people, according to the California Restaurant Association.

But with the shutdown, up to a million of those workers were quickly put on leave or fired, the association told the state’s Senate Special Committee on Emergency Pandemic Response.

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

Restaurant employment is still down a quarter from before the pandemic, according to the latest figures from the state’s employment development department.

Industry executives have said they fear a 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 abated. .

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 in trouble

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

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

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

The industry is expected to eventually rebound, the Restaurant Association reported, creating another 160,000 jobs by 2029, for a total of nearly 2 million statewide.

“We can’t wait to start over, but it will take several years,” said Sutton. In the meantime, he said restaurants need to recover from lost revenue while their fixed costs like rent and insurance continue.

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

“Restaurant closures literally hit the ground,” he said, affecting a large part of the economy, including food suppliers. Many establishments weren’t designed around a take-out model, but most still tried to adapt “to keep their doors open to some extent” and keep some employees at work.

In retrospect, the state lacked evidence to support its decision to shut down alfresco dining and that rationale “was not communicated effectively,” said Dr Matt Willis, Marin County public health official. .

“Even without specific knowledge… I think this is an area where we could have done better,” Willis said, although he said the evidence for virus transmission from indoor meals were much clearer.

With no time to collect data on the risk of open-air contact transmission, health officials had to use their best judgment at the time, but now understand that the risk of transmission to the exterior is weak, said Willis and the director of the California Conference of Environmental Health Directors. 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 of how to respond to this.”

Adapt to the new era

Restaurants said they adapted to a new business model on the fly during the pandemic, with help from the State Department of Alcohol Control, which was also responsible for inspecting establishments to ensure that they were following the rules of the pandemic.

They could offer curbside or free off-site deliveries, expand to outdoor spaces like patios, sidewalks, parking lots or closed streets with local approval, and sell alcoholic beverages to consume off-site. or with take-out. The state waived license renewal fees for two years for qualifying businesses.

In addition to safety measures such as masks, increased sanitation, employee health checks and physical distancing, restaurants adopted disposable menus or menus that customers could see on their smartphones and switched to providing food. silverware pre-rolled into napkins.

The improvements that restaurants make to their indoor airflow and filtering will stay in the long run, Sutton said, and restaurants also want to be able to maintain their expanded outdoor dining options.

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