Worcester Business Journal

wbjournal.com | November 9, 2020 | Worcester Business Journal 23 190 Turnpike Road Westborough, MA 01581 8 0 0 - 5 4 0 - 4 9 9 3 | w w w . C u r r y P r i n t i n g . c o m Proudly Serving the Worcester Area Since 1978 R E S T A U R A N T R E V E N U E F A C T B O O K Restaurant in Northbridge. Tough future Mike Elmes, a business professor at Worcester Polytechnic Institute, isn't confident restaurants will have easier days ahead, now that the weather is cold- er and coronavirus cases are rising. "Given how easily this virus is trans- mitted via aerosol droplets in closed spaces, it is not clear to me how many customers will risk eating in restaurants in spite of the precautions that restau- rants are taking," he said. e Massachusetts economy as a whole has been hit harder than most states, with a September unemployment rate of 9.6%, the country's seventh worst. e state ranked last in the nation in June and July. e state's food and accommodation industry has included more than 1,500 new unemployment claims each week since mid-September, and since March has had more than 170,000 unemploy- ment claims, according to the Massa- chusetts Executive Office of Labor and Workforce Development. at's made it the hardest hit industry in the state. In fact, the Massachusetts restaurant industry has been the hardest hit of any in America, according to the Nation- al Restaurant Association, with 7,900 restaurant jobs lost as of September. e next closest state, Florida, with a popula- tion three times larger, lost 4,600. To Elmes, a further erosion of Worces- ter's restaurant scene could be harmful for the city more broadly, both in terms of lost jobs, declining tax revenue and more vacant buildings – as well as more intangible effects. "e loss of restaurants in the city would be a significant loss for the com- munity and likely a big hit to the local economy," he said. "It might also hurt Worcester's reputation as an up-and- coming city." e national picture for restaurants isn't quite as bleak as what's taking place in Massachusetts. Restaurant sales were down 15% in September compared to February, before the pandemic hit in earnest, according to the National Restaurant Association. e low point was April, when sales were down 54% compared to February. Sales began picking up significantly in May and June, before the first wave of cases spread to all areas of the country. Between March and September, sales were down nearly $162 billion from expected levels before the pandemic, the association said. Restaurant employ- Continued on page 27 Restaurant industry employment Worcester % change % change County year-over-year year-over-year Year employees in county nationally 2011 19,811 2012 20,080 1.36% 3.77% 2013 20,499 2.09% 3.80% 2014 20,880 1.86% 3.23% 2015 21,494 2.94% 3.54% 2016 22,208 3.32% 3.19% 2017 22,855 2.91% 2.17% 2018 23,075 0.96% 1.52% 2019 22,885 -0.82% 1.23% Note: Prior to 2011, the U.S. Bureau of Labor Statistics categorized restaurant workers differently. Source: U.S. Bureau of Labor Statistics ment in 47 states and Washington, D.C. remained below February's pre-corona- virus level, including every state in New England except Connecticut. A survey by the association in Sep- tember estimated 100,000 restaurants had closed six months into the pandem- ic, with 40% of restaurateurs not sure they'll survive another six months. Low revenues create budget problems A silver lining exists in how drops in sales revenue may affect municipalities, or at least Worcester specifically. A study in April by the Brookings In- stitution found Worcester's tax structure, which doesn't rely on income or sales tax to support the municipal budget, should shield it from the worst fiscal effects from the coronavirus pandemic. It's a tax structure generally shared by other

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