Restaurants struggling in the US despite government aid

Increased funding by the United States government for the struggling restaurant industry has begun to help, but many restaurants are continuing to struggle both financially and with labor shortages.

The latest seafood restaurant bankruptcy filings include The Lost Cajun Enterprises, the franchising arm of The Lost Cajun; The Crabcake Factory in Ocean City, Maryland; and Casa Bonita in Denver, Colorado.

Additionally, the industry is facing its worst labor shortage in recent memory. Samuel D’Angelo, the CEO of Philadelphia, Pennsylvania-based distributor and wholesaler Samuels & Son Seafood in Philadelphia, Pennsylvania, told SeafoodSource last month that distributors and the restaurants they service are battling severe labor and supply chain challenges.

“Our labor force is down about 10 to 20 percent,” D’Angelo said.

Some of the employees the distributor had to lay off at the beginning of the pandemic have not returned and it is challenging to hire new employees, D’Angelo added.

Sixty-five percent of restaurant and tourism employees said in a recent Florida Atlantic University survey that employers were too quick to fire or furlough them and that employers cared more about stock value than the workers themselves. More than one-third of respondents indicated they would be seeking employment outside the industry over the next year.

“The results of this poll clearly indicate that employees now are fed up and are looking at moving on to other industries. That’s a huge concern,” Peter Ricci, director of FAU’s hospitality and tourism management program, said in a press release.

However, Bloomin’ Brands – which owns Bonefish Grill, Outback Steakhouse, and other restaurant brands – has not been as hard hit with labor issues due to retaining most of its staff since the start of COVID.

“That gave us a higher staffing base, a more committed employee base, higher retention and very low turnover. That base is extremely important as we go forward” Bloomin’ Brands CEO David Deno said, per Nation’s Restaurant News.

Meanwhile, more than 186,000 restaurants, bars, and other businesses applied for the USD 28.6 billion (EUR 23.5 billion) Restaurant Revitalization Fund (RRF) within the first few days of the applications opening.

"The overwhelming demand for this fund makes it clear that restaurants and bars are suffering," Independent Restaurant Coalition Executive Director Erika Polmar said in a press release. "We know there is more work to do: independent restaurants and bars lost over US 200 billion [EUR 165 billion] in revenue since the start of the pandemic through no fault of their own.”

In addition to the RRF, the Biden Administration approved USD 31 billion (EUR 25 billion) in Paycheck Protection Program (PPP) loans, USD 438 million (EUR 360 minion) in COVID-19 Economic Injury Disaster Loans (EIDL), and more than USD 29 million in Targeted EIDL Advance grants to restaurants and bars around the country, the White House said in a notice on its website.  

Photo courtesy of BublikHaus/Shutterstock


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