New York’s restaurant industry continues to face “widespread and overwhelming hardship” in the wake of COVID-19 and will have an uphill battle to fully recover.
That’s according to research from the National Restaurant Association and the New York State Restaurant Association (NYSRA).
Restaurants are one of the city’s biggest industries, worth more than $18.5 billion, but a recent NYSRA survey found that 41% of New York operators say the conditions trade conditions are worse now than they were three months ago.
Only 20% of 267 restaurateurs surveyed between July 14 and August 5 said business conditions had improved over the past three months.
Melissa Fleischut, president and CEO of NYSRA, told the China Daily: “I would say the main fight [for restaurants] is the increased cost of everything they’re facing right now.
“Wholesale food prices have gone up dramatically, you know, about 15-17%; their rent has gone up, their utilities have gone up, their labor costs have gone up. So all of their expenses at all levels have increased significantly due to supply chain issues and inflation.”
At least 39% of New York restaurateurs surveyed said business conditions will never return to normal, and 42% believe it will take more than a year.
Restaurateur Luca Di Pietro had five locations for Taralluci e Vino, his Italian restaurant and wine bar. He recently had to close one.
He is also a co-founder of Feed the Frontlines NYC, a for-profit organization that spearheaded an initiative that provided hundreds of thousands of meals to frontline workers, nurses and doctors at the height of the pandemic. Today, it is his industry that needs help.
Di Pietro told China Daily: “We have locations in the 18th and 28th Street business districts that have been hit really, really badly; they’re still badly hit. I’ve basically had to close restaurants for a few months from mid-March 2020 to around mid-May.
“I felt very bad. I felt bad because I felt the people who worked for me were going to have a really hard time. Across all of our sites, we had about 115 employees. Now we have about 88,” a- he declared.
Data from the New York State Comptroller’s Office in January revealed that employment in the restaurant, retail and recreation sectors fell by 169,700 jobs in November 2021 compared to November 2019. Overall, restaurants now employ 30% fewer workers than in 2019.
Di Pietro said several other issues still exist for restaurant owners post-pandemic. Many of its New York customers who make up the bulk of its business are still working remotely and not spending money in town for lunch or dinner.
He added that paying higher salaries to staff, inflation, food costs and a 30-40% increase in utility bills also affect profitability.
“I can tell you that this summer most of my businesses were in the red,” he said.
After indoor dining was restricted from 2020, many, including Di Pietro, created outdoor dining sheds on sidewalks and roads and increased take-out services.
In mid-August, New York City Mayor Eric Adams said “outdoor dining is here to stay.” He also came to the defense of the structures, saying they had “saved 100,000 jobs” in the restaurant industry during the pandemic.
However, some residents who live near restaurants with outdoor dining structures don’t like them. A group of New Yorkers are suing the city for the spaces.
In 2020, the city’s transportation department released guidelines for restaurants to create their outdoor spaces. The city has yet to update the guidelines or make an official announcement on their fate.
The city’s “Open Restaurants” program is expected to become permanent. But it’s been slowed down due to litigation, according to the New York Times.
Some of the changes under the program may include restaurants having to pay fees and seek permission to continue or create outdoor dining.
Meera Joshi, deputy mayor for city operations, said a task force will review complaints from nearby residential neighbors and those who have taken legal action. Those who object say the outdoor dining sheds look dilapidated, food droppings attract rats, generate litter, and the din of diners affects their quality of life.
As of September 2, the task force had removed 55 abandoned or non-conforming sheds to city regulations.
The shed sidewalk locations have also been criticized by plaintiffs, who argue they interfere with pedestrian access.
Tanya Bonner, a plaintiff in the lawsuit and a professor in the communications department at St. John’s University, who lives in Washington Heights, wants the Open Restaurants program to end.
“I understood the need for something like this at the height of the pandemic. But that’s not where we are right now,” she told The Times.
The NYSRA also found that about 77% of restaurants reduced their hours of operation and 47% closed on days they would normally be open.
At least 49% of respondents said they had stopped working at full capacity. Fifty-three percent cut staff, while 32 percent postponed new hires.
“I’m an optimist in general, but I think it’s going to be tough in the next few months,” Di Pietro said. “I think the city needs to get people back to work. Crime needs to be under control.”