March 4 — Independent Restaurants Statement on February Employment Report: Nearly 200,000 Businesses Remain at Risk of Closing Permanently, Taking Jobs With Them
FOR IMMEDIATE RELEASE
March 4, 2022
CONTACT:
Jeff Solnet
Independent Restaurants Statement on February Employment Report: Nearly 200,000 Businesses Remain at Risk of Closing Permanently, Taking Jobs With Them
Restaurant Employment Still 824,000 Below Pre-Pandemic Levels
Over 11,000 Restaurant Workers, Owners, Suppliers, Workers, and Diners Urged Biden Administration to Refill Restaurant Revitalization Fund
Nearly 200,000 Restaurants Applied for a Restaurant Revitalization Fund Grant Last Spring and Still Waiting for Help; 80% Risk Closing Permanently Without Assistance
WASHINGTON D.C. – Today, the Independent Restaurant Coalition (IRC) released a statement in response to new employment data from the Bureau of Labor Statistics (BLS). The report showed that restaurant and bar employment is still down 824,000 from pre-pandemic levels.
“Independent restaurants used to be one of America’s largest employers, and we have a long way to go to fully recover from the pandemic and record inflation,” said Erika Polmar, Executive Director of the Independent Restaurant Coalition. “Nearly 200,000 businesses and the people they employ are still waiting to receive a Restaurant Revitalization Fund grant and they are running out of time after two years of debt, multiple COVID-19 surges, and dealing with unprecedented food prices. The independent restaurant and bar community is growing increasingly desperate and frustrated that their elected officials have not helped them in their time of need. Congress and the Biden Administration need to finish the work they started and replenish the Restaurant Revitalization Fund immediately.”
This week, over 11,000 restaurant owners, suppliers, diners, and workers sent a letter to the Biden administration, urging action on the Restaurant Revitalization Fund. In the letter, business owners wrote “[T]his program's limited funding failed to support roughly two-thirds of the eligible businesses that applied. Nearly 200,000 small businesses have been overlooked and now four out of five of these restaurants and bars are in danger of closing permanently, threatening all of the livelihoods we support.“
“Restaurants will continue to struggle to provide jobs without Restaurant Revitalization Fund grants,” said Lindsay Mescher, Chef/Owner of Greenhouse Cafe in Lebanon, Ohio. “Many neighborhood restaurants and bars are operating with skeletal staffs right now because our industry is in financial ruin. Pandemic restrictions might be lifting, but our businesses will struggle to hire if we don’t have the financial flexibility to pay down our enormous debts. There are more than 6,000 Ohio restaurants and bars just like mine that are depending on Senators Brown and Portman to keep our doors open. If they don’t act soon, the impact will be catastrophic.”
The February jobs report showed that restaurants are 824,000 jobs below their pre-pandemic levels as businesses struggle to reach their pre-pandemic form:
Unemployment rate for leisure and hospitality is 6.6%, 2.5% higher than the economy-wide rate, as restaurant and bar employment is still down 824,000 below its pre-pandemic levels.
Since February 2020, employment in leisure and hospitality is down by 1.5 million, or 9.0%.
Even though the industry is hurting, it is clear that restaurants and bars have been making an effort to increase wages. Over the past year, leisure and hospitality wages have increased by roughly $59.01 on a weekly basis, a 13.4% increase during that period.
At least 90,000 restaurants and bars have closed since the beginning of the pandemic. Nearly 300,000 restaurants and bars applied for RRF grants in 2021, but only about one in three applicants received relief. 80% of restaurants that did not receive an RRF grant reported they are on the verge of permanent closure.
The IRC recently released data collected from a survey of nearly 1,200 members of the independent restaurant and bar community in all 50 states that demonstrates the dire situation the pandemic has created for businesses, especially those that did not receive federal RRF grants.
49% of businesses that did not receive RRF grants were forced to lay off workers because of the Omicron surge compared to 33% of businesses that received RRF grants.
42% of businesses that did not receive RRF grants are in danger of filing for or have filed for bankruptcy, compared to just 20% that received RRF grants.
28% of businesses that did not receive RRF grants have received or are anticipating receiving an eviction notice compared to just 10% that received RRF grants.
Restaurant and bar owners who did not receive an RRF grant are taking on more personal debt. 41% of people that did not receive RRF reported taking out new personal loans to support their businesses since February of 2020. This is only true for 19% of businesses that received an RRF grant.
46% of businesses reported that their operating hours were impacted for more than 10 days in December 2021.
58% of businesses reported that their sales decreased by more than half in December 2021.
The strained supply chain has caused food prices to climb higher and higher. The recent Producer Price Index (PPI) report released by the Bureau of Labor Statistics (BLS) indicated food prices rose 12.8% over the past year, including major jumps for ingredients critical to restaurants like beef and veal (43.9%), grains (22%), shortening and cooking oils (36.4%), and eggs (40.9%).
The IRC has continued to organize its grassroots movement to put pressure on members of Congress to replenish the RRF. In January, the IRC generated over 10,000 calls to congressional offices after a social media day of action. Local leaders have also joined relief efforts — in early January, mayors from 31 cities representing more than 19 million Americans urged Congressional leadership to continue the vital program, saying not giving restaurants relief would be “catastrophic.”
Existing legislation to refill the RRF carries wide bipartisan support. 299 lawmakers in the House of Representatives and 52 members of the Senate have signed onto four pieces of legislation supporting adding money to the RRF (H.R. 3807, H.R. 4568, S.2091, and S. 2675).
ABOUT THE IRC:
The Independent Restaurant Coalition was formed by chefs and independent restaurant owners across the country who have built a grassroots movement to secure vital protections for the nation’s 500,000 independent restaurants and the more than 11 million restaurant and bar workers impacted by the coronavirus pandemic.
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