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University of Houston measures effects of pandemic on restaurant industry

Monday, April 27, 2020 by Jessi Devenyns

Prior to the spread of Covid-19 throughout the state of Texas, the restaurant industry employed one out of every 10 working Texans. Now, the sobering impacts of the quarantine measures that the state enacted in mid-March are coming to light. According to a study done by the University of Houston Hobby School involving 1,342 restaurants, 90 percent of them said sales dropped between March 23 and April 6 compared to the previous year. As a result, four out of five owners of food service venues have laid off employees. And these layoffs are a symptom of deeper impacts. Eighty percent of owners said it will take their businesses nine months or longer to recover from the revenue reductions and 3 percent said they don’t expect to ever recover. Even with government aid, the restaurant industry will face headwinds as it works to recover from this economic crisis. Jim Granato, executive director of the Hobby School, said in a statement, “Restaurants and bars are key players in the national and Texas economy, and they have been among the most negatively affected by the virus and the closures …. How well they recover when we start to reopen commercial activities will be an important part of the nation’s overall recovery.” Restaurant owners have hardly been sitting idle; while the study showed that 41 percent of restaurants have temporarily closed one or more locations, those remaining open have pivoted to takeout and delivery services. Only 38 percent of those surveyed offered takeout prior to the pandemic, with even fewer offering delivery. Others have pivoted their business models even more radically and 25 percent now offer bulk food sales.

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