Restaurant workers file for unemployment as owners try take-out to stay afloat
The novel coronavirus pandemic has turned America’s urban restaurant hot spots into virtual ghost towns.
Dine-in restaurants, shuttered over public health concerns, are forecast to lose $225 billion in business nationwide over the next three months, according to an industry trade group. Five to seven million restaurant service and kitchen jobs could be eliminated over the same period.
Hundreds of thousands of U.S. restaurant workers this week alone have already received bad news, analysts say.
"I am like wondering what I'm gonna do for like money and how I'm gonna support myself in the future, coming weeks," said Sharnaye Raiford, a 20-year-old high school graduate and server at Barcelona wine bar and tapas restaurant in Washington, D.C. "They're telling us to file for unemployment and then hopefully when everything is over, they’ll gladly hire us back."
"But they want us to be secure with like funding and financial stuff, so that's why they're really pushing the unemployment," she said of her employer.
Raiford said she made between $1,200 and $1,500 a month, on average, enough to cover her $500 rent, transportation and food for herself and her dog -- but she he can't afford a cell phone or cable TV.
She added that she also financially helps out her father, who was recently released from prison, and her mother, who receives disability benefits for multiple sclerosis when she can.
But with no savings in the bank, Raiford now faces an imminent financial crisis.
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Almost 40% of American adults wouldn’t be able to cover a $400 emergency with cash, savings or a credit-card charge that they could quickly pay off, a Federal Reserve survey found .
"I've never been laid off before. I was incredibly shocked. I just never imagined I would be person who'd get laid off." said Max Rees, a 23-year-old barista at Compass Coffee in D.C., who also lost his job this week. "I just didn't ever see that coming."
He added, "I would say my biggest financial worry right now is probably health insurance just because that got taken away. If I get sick or something like that, I'm not really sure what I'm going to do in that case."
Rees and Raiford have now joined the ranks of Americans applying for unemployment benefits. New claims have surged to the highest level in more than two years, according to the Department of Labor.
Some restaurant owners are trying to soften the blow. Rose Previte -- who owns Maydan and Compass Rose in D.C. -- is extending health benefits for around 50 of her furloughed employees.
"When you start a new business, you think of all the terrible things that could could ruin you, and this is not one that I thought of. Global pandemic was not on my list of worst case scenarios," she said in an interview with ABC News at her flagship restaurant. "We had to let our entire front of house staff go -- so that means servers, bartenders, food runners and bar backs, and they were very, very difficult calls to make."
Previte's kitchens – like those at thousands of other restaurants – are for the first time attempting take-out service to keep at least some employees on the job.
"Hopefully, if we can keep this going we'll be able to keep our kitchen staff working with minimal layoffs," Previte said.
She projects maintaining about 20% of her normal revenue with the slimmed down operation; not enough to make profit, but enough to sustain wages for 15 staff.
"We have to figure out a creative way to not bring too many people here at the same time. So we're only allowing five people at a time to pick up their orders in like a 20-minute, 30-minute period," she said. "That will minimize lines outside and minimize the amount of people who are here together."
But is the model sustainable, and are consumers ready to pay restaurant prices for high-end meals to-go?
"We've had so many people just say, like, 'We're buying this to support you, we know what you're going through'," Previte said. "It means so, so much."
Many restaurants have had to close their doors entirely, as the coronavirus continues to spread.
The owners of Little Sesame, a mediterranean-themed fast-casual restaurant in the D.C. business district, shut down its two locations this month. Owners Nick and David Wiseman and Ronen Tenne are now trying to pay it forward by giving out free meals in the community.
“We’re trying to use all the last ingredients we have so they don’t go to waste," said Crystal Mendoza, director of training at Little Sesame, as she handed out lunch bags from the shop's food truck. "It's all pretty hearty, healthy, filling."
The team has distributed hundreds of meals this week to needy families -- including stopping by a middle school in a low-income neighborhood in northeast D.C. Edgar Morales, a Guatemalan immigrant and father of three, drove 20-miles roundtrip to pick up a meal.
He lost his job as a barista this week because of the pandemic.
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"It's very tough because, first of all, the rent is coming. We’ll see what we can do to solve that problem, but it’s very tough," Morales told ABC News. "I've lived here 14 years and I've never been without a job."
For now, many restaurant workers are trying to remain optimistic as restauranteurs do all they can to stave off shutting their dining room doors for good.
"The smaller the business, definitely the harder the hit," Previte said. " We're still piecing together as we want to see what we're going to be able to do, how scrappy we can get, how many other inventive ideas we can come up with. But it's terrifying to think that we wouldn't be able to open until after summer."
Raiford said she's hopeful the pandemic will end more quickly than the headlines suggest.
"I’m not saying that you shouldn't be panicking or tripping; that's just not what I would gear my energy towards," she said. "I will be like, ‘Okay, this really sucks.’ Like, I'm kind of freaking out a little bit, but you know, things are gonna move forward. People are still being born every day."
She added, "There's new things being created. There's new solutions happening."
Restaurant advocates say one of the best ways to help your favorite local dining establishments stay afloat is to participate in take-out programs they may be offering and to buy gift cards, which offer owners an infusion of cash now which a patron can claim later once they reopen.
