National Restaurant Association steps up pressure on Congress for aid

Restaurant casualties will soar past the current 110,000 closures--17% of the industry--without immediate relief, the group warns.
Photograph: Shutterstock

The National Restaurant Association is intensifying the pressure on Congress to pass a relief package that would help the industry survive the worsening COVID-19 crisis, warning Monday morning that closures will soar far beyond the current casualty count of 110,000 locations—about 17% of the business—without an immediate financial lifeline.

In a letter to Congressional leaders, the association provided new survey data that show the industry is bleeding out. Sales for roughly 9 out of 10 restaurants (87%) have dropped by more than a third (36%), while costs have not dipped accordingly.

Labor costs, for instance, have risen above pre-pandemic levels for 59% of the 6,000 restaurants that were surveyed, according to the organization. Fifty-eight percent of the surveyed full-service places expect layoffs and furloughs to persist through the next three months, which health officials say will be more severe than the upswing in coronavirus infections at the start of the pandemic.

The association noted that many of the restaurant casualties to date were landmarks within their communities, with an average age of 16 years. About 1 in 6 (16%) had been open for at least 30 years, the group said. Less than half (48%) of the operators who ran those establishments intend to remain in the business.

“What these findings make clear is that more than 500,000 restaurants of every business type—franchise, chain, and independent—are in an economic free fall,” Sean Kennedy, EVP of public affairs for the association, wrote in the letter. “And for every month that passes without a solution from Congress, thousands more restaurants will close their doors for good.”

The letter was sent to leaders of the Senate and House of Representatives as rank-and-file members push a bipartisan bare-bones proposal for a $908 billion aid package. About $288 billion of that tally would be channeled to restaurants and small businesses, in part by re-starting the Paycheck Protection Program.

The measure won the support last week of Speaker of the House Nancy Pelosi and Senate Minority Leader Chuck Schumer. Senate Majority Leader Mitch McConnell had initially indicated he did not support the proposal, but later showed some openness to it. Most observers initially gave the plan a slim chance of going farther than the proposal stage, but now many are speculating that the measure could be incorporated into a larger spending plan that is needed to keep the federal government in operation past Dec. 11, when its funding runs dry.

The proposal has the support of President-elect Joe Biden, who calls it a “down payment” on a larger aid package that he has pledged to push as his highest priority after being sworn in as the nation’s chief executive on Jan. 20.

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