Michigan Restaurants Report $491 Million In Lost Sales During COVID-19 Closures

A mandatory shutdown of all dine-in service at local restaurants has created major financial shortfalls for the state’s restaurant industry during one of its busiest months, according to a new report from the Michigan Restaurant & Lodging Association.

“The restaurant industry is being decimated by our shelter-in-place and forced closure rulings.” – Justin Winslow, Michigan Restaurant & Lodging Association

In a span of 22 days in March, Michigan saw 72,000 restaurant-specific jobs disappear and $491 million in lost sales for restaurants. Those numbers include both mom-and-pop and chain restaurants throughout the state, part of a group of restaurant operators across the nation that were surveyed by the National Restaurant Association in the past week.

“The restaurant industry is being decimated by our shelter-in-place and forced closure rulings. Frankly, we’re just on the front end of this,” Justin Winslow, CEO of the Michigan Restaurant & Lodging Association (MRLA), which represents more than 5,000 hospitality establishments in the state.

“It’s affecting everyone — from top management to all the way down,” adds Winslow.

Ryan Patrick Hooper

Prior to the COVID-19 pandemic, the association estimated that the state’s hospitality industry was worth $40 billion in annual sales and employed nearly 600,000 people.

Now, it’s anticipating nearly 300,000 people employed by hotels and restaurants throughout the state to temporarily lose their jobs. 

To aid unemployed workers, the association’s Education Foundation launched a relief fund that will grant $500 to approved applicants until resources are fully depleted. In order to receive assistance, applicants must demonstrate proof of employment in the hospitality industry on March 10th — the same day when Gov. Gretchen Whitmer declared a state of emergency in Michigan — as well as proof of furlough or job loss in the wake of that date.

“The professionals who dedicate themselves each day to improving ours through excellent service and world-class hospitality don’t deserve this outcome,” said Winslow in a statement.

A few major takeaways from the restaurant industry in Michigan following the spread of COVID-19 and subsequent hospitality-related shutdowns: 

• In the first three weeks of March, 62% percent of restaurant operators laid off employees. Almost half, 47%, anticipate doing more of this during the next 30 days.

• 41% of restaurant operators temporarily closed their restaurant in the first three weeks of March

• Only 1% of restaurant operators permanently closed their restaurant in the first three weeks of March. About 9% anticipate permanently closing their restaurant within the next 30 days.

Click the player to listen to the full interview with Michigan Restaurant & Lodging Association CEO Justin Winslow about the state of Michigan’s industry in the wake of COVID-19