With U.S. restaurants facing prospects of losing an estimated $240 billion by year’s end, the industry has asked Congress for more financial aid as the coronavirus continues to take its toll.
According to a survey of more than 6,500 restaurant operators conducted by the National Restaurant Association (NRA) last week, from April 1 through April 10, sales were down by 78 percent compared to the same time period a year ago. The projected loss for all of April is more than $50 billion, the study said.
The Washington, D.C. trade association said that COVID-19 has forced more than eight million restaurant employees to be laid off or furloughed since the beginning of the outbreak last month. That’s two-thirds of the 12 million employees who were working at the nation’s restaurants in February.
According to a Reuters report, the group said that existing federal relief programs will not help restaurants to prevent more layoffs. The news service said the Small Business Association's Paycheck Protection Program (PPP) makes it impossible for many restaurants to pay back or even use the loans.
The NRA argued that some smaller restaurants did not get loans before the fund was exhausted last week. House and Senate leaders are working with the White House to replenish the funds.
Restaurants are also seeking a $240 billion Restaurant and Foodservice Industry Recovery Fund. That follows their initial request last month for $145 billion in cash relief through such a fund, which was not created. If approved, the fund would provide cash to eateries that have lost a minimum of 25 percent of sales to help them compensate for government-mandated closures, restocking and rehire workers, Reuters reported.
The request for more aid comes as Shake Shack Inc., the New York-based burger chain, said it would return the $10 million PPP loan it received because it was able to raise capital privately.
In her latest update, PYMNTS’ Karen Webster attempts to answer these questions: Are we flattening the curve? When can we reopen the economy? What will life look like once we do?