- September 7, 2021
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Nearly one in six restaurants shut down in the first six months of the pandemic.
On Location: September 6, 2021
When COVID-19 reached the U.S. and government restrictions set in — closing indoor dining in much of the country — millions of restaurant workers found themselves without jobs. But now, as restaurants are reopening and people are once again going out to eat, owners are facing a different challenge: Their workers haven’t returned.
“The thing I remember most about those early months and weeks was the word ‘grief,'” said Sava Farah, owner of The Pulpo Group, which operates three restaurants in Ann Arbor, Michigan. “We had to lay off over 200 employees that we called family.”
At the time, no one knew how long restaurants would be forced to supplant their revenue with to-go orders and outdoor dining. For many, that was never going to cut it.
The National Restaurant Association estimates that in the first six months of the pandemic, nearly one in six restaurants — almost 100,000 businesses — shut down.
Things began to look up in December 2020, as the federal government gave authorization to the first two COVID-19 vaccines. Shortly after, cases began declining, restrictions started to be lifted and restaurants were once again able to open their doors for indoor dining.
But even though the customers returned, many workers did not.
“If you look at who is working in restaurants in 2019 versus today, there’s about a million people who have disappeared,” said Micheline Maynard, Washington Post columnist and author of the soon-to-be-released book “Satisfaction Guaranteed: How Zingerman’s Built A Corner Deli Into a Global Food Community.”
The labor shortage is having wide-ranging effects on the industry. Many restaurants are having to cut hours, sometimes opening only for dinner service rather than all-day service. Some are even cutting entire days of service.
The reasons behind the labor shortage have become political.
Republicans argue that money offered as part of enhanced unemployment packages passed by Congress has taken away the incentive for people to return to work.
Those enhanced unemployment benefits won’t be around forever, though. The Biden administration is ending federal enhanced unemployment benefits on Labor Day, and prior to that, more than half of U.S. states had already ended unemployment boosts.
Democrats, meanwhile, argue that it’s not a matter of paying people too much to stay home, it’s a matter of paying people too little to work.
“You get a very low wage,” said Maynard about many restaurant jobs. “As much as $5 less than the minimum wage, and then your tips are supposed to bump you up to minimum or above.”
But even restaurants that offer higher wages are having issues finding workers.
An industry in need of a reset
Micheline Maynard and Sava Farah say the real problem lies within the industry itself.
The hospitality industry is already high-stress and physically taxing, and now the pandemic has brought new challenges, including an increased risk of exposure to COVID-19.
“Servers are tasked with reminding people that they have to have a mask on,” Maynard said.
Those who return to restaurant work are also having to work harder due to staffing shortages. But because they’re missing that extra set of hands, service becomes slower and tables don’t turn over as quickly.
“And the person who hears the complaints about that is the server,” said Maynard. “It’s hard on the staff, it’s hard on the owners, they’re stressed all the time [and] people are leaving.”
Sava Farah said well before the pandemic the stress of the restaurant industry was already leading to a “burnout culture” — one that often came along with drugs and alcohol use.
Now, with the added problem of the staffing shortages, she thinks it’s time for a reset in the industry — even if that means some doors have to close.
“I don’t think that’s a very bad thing. I know at least one of my restaurants is closed,” said Farah. “There’s just way too much competition in the marketplace currently and it causes all the restaurants around to have to lower their prices. And when you lower your prices, you lower your pay rates, you lower your profit margins, you lower the caliber of the restaurant.”
Micheline Maynard said it might also be time for legislators to get involved, especially if more federal money ends up going to restaurants.
“Basically Congress, and then the Obama and Bush administrations said there are going to be some strings attached,” Maynard said, recalling the auto bailouts during the Great Recession that ushered in industry reforms. “Restaurants need that same kind of examination.”
Listen to this story from ABC News Radio Labor Day Special “Help Wanted” below:
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