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Restaurants shed jobs again in January

The industry shed 19,400 jobs during the month even as sales improved, though the rate of employment decline is shrinking.
Restaurant job cuts
Photograph: Shutterstock

Restaurants shed another 19,400 jobs in January, the third straight month in which the industry cut the number of employees, according to new federal Labor Department data released on Friday.

Restaurants now employ 9.94 million workers, down from 9.96 million in December. Restaurants employ 3.6 million more workers than they did in April, when broad shutdowns of dining room service in almost every state led to massive closures and steep sales declines.

Yet the industry remains 2.3 million restaurant workers short of where it was in February, before the pandemic, according to federal data.

General weakness in the restaurant space appears to be hampering the overall jobs recovery. The economy added just 49,000 jobs last month even as $600 stimulus payments early in January appeared to give spending a lift—sales at restaurant chains have been thriving in the weeks since then. Yum Brands, the owner of Taco Bell, KFC, Pizza Hut and Habit Burger, said Thursday its same-store sales were up in the “mid-teens” last month.

But executives also suggested the impact from the stimulus is “waning.” Congress is currently debating a renewed stimulus that would send many Americans $1,400 stimulus payments.

That measure could also include $25 billion in targeted relief for restaurants.

Restaurants had been adding back workers in the months since April as states reopened dining rooms and stimulus measures—notably the Paycheck Protection Program—incentivized businesses to bring back employees. The renewed surge in virus cases in November led to further closures in dine-in service, which ultimately led to more job cuts.

Still, the rate of decline in January shrunk considerably—the industry cut 400,000 jobs in December, for instance.

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