Sun Sentinel Palm Beach Edition
It could take years for state’s jobs to recover
South Florida’s tourism-heavy economy is paying a price in jobs lost to COVID-19 — a toll so heavy that some executives don’t see a recovery until two years from now.
All three counties have lost a substantial number of jobs in hotels, restaurants and leisure-oriented businesses, but Broward County has taken the biggest hit, according to the most recent data available,
Unemployment reached 16% in Broward in May. Palm Beach County fared better at 14.1% and Miami-Dade at 11.3% — just a year after unemployment hovered around 3%.
Other tourism centers have suffered, too. Unemployment in Orange County — home to Disney World, Universal and other nationally prominent attractions — hit a sky-high 23.2% in May, the second-worst in the state. Only Osceola County, directly to the south, was hit harder, with 31.1% of the workforce unemployed.
With the coronavirus pandemic raging more than ever, many tourism-dependent businesses say they won’t be able to recall workers as quickly as they had hoped, and the economic damage is spotlighting South Florida’s need to develop other types of industries.
When he ran for mayor of Fort Lauderdale, Dean Trantalis campaigned to further diversify the city’s economy, arguing that tourism was susceptible to disruptions
from storms to economic downturns.
“I continued to advocate for diversity because it would draw in more opportunities with varying talents, hopefully improve wage scales and again allow us to be less reliant on tourism,” he said in an interview Friday. “It is always going to be sensitive to the vagaries of the economy … who knew out of left field we were going to have a pandemic?”
The mayor said the city has made strides by increasing its base in technology and financial services industries. “I think the economy probably would have been worse if we hadn’t made these strides,” he said.
For example, Kemet Corp., the maker of capacitors for the automotive, aerospace and other industries, moved its headquarters from South Carolina to downtown Fort Lauderdale in 2018.
Out of Broward’s top 10 employers, only one — JAE Restaurants of Pompano Beach, which operates Wendy’s outlets in several states — is tied to the dining-out business, according to a list maintained by the Greater Fort Lauderdale Alliance, which is responsible for attracting new business to the county.
The other companies on the list focus on education, real estate, software, telecommunications, staffing, insurance and auto sales.
David Coddington, senior vice president of business development at the Greater Fort Lauderdale Alliance, said other industries outside tourism have suffered, but not to the extent of tourism.
The marine industry “is going phenomenal right now,” with some companies enjoying “the best sales records they’ve ever
had,” he said
Still, hotels, restaurants and transportation-related companies all have laid off or furloughed thousands in the face of government ordered lockdowns and other restrictions.
Broward alone has over 500 hotels and more than 4,000 restaurants. Between Jan. 1 and July 4 of this year, hotel occupancy in the area has declined year over year by 34%, while daily room rates are off by 16%, according to the Greater Fort Lauderdale Convention and Visitors Bureau.
“If I were today to take a long-shot view on this. to get back to levels where we were pre-COVID-19, I would say 2022 would be the time when we’re getting back to those particular levels,” said Heiko Dobrikow, executive vice president of the Las Olas Co. and general manager of the Riverside Hotel in Fort Lauderdale.
Extended furloughs
Many hotels around the region continue to operate well below pre-pandemic levels. A number of businesses have notified the state that they can’t recall furloughed workers for another six months.
Since the Riverside Holoughs
tel, Fort Lauderdale’s oldest, returned to full operations on May 18, it didn’t take long for its two restaurants to return to customer levels the business enjoyed last year, Dobrikow said.
“There was certainly pent-up demand,” he said, largely because the diners wanted to finally get out of their homes. Then new COVID-19 cases started to spike around the region, forcing local governments to reimpose new public health restrictions. MiamiDade County ordered restaurants to close their dining rooms and revert to takeout service and outside dining.
Broward stopped short of matching the move, but Dobrikow said it took hard lobbying by owners to keep local dining rooms open, though under modified conditions.
The Riverside has recalled only half of its prepandemic work force of 300. “We are not going to bring back the same amount of staff we had before,” Dobrikow said.
Neither are a number of other large hotels.
Within the last week, the Diplomat Beach Resort in Hollywood, the Renaissance in Plantation, the Boca Raton Resort & Club and the Fontainebleau in Miami Beach have all notified the state that they are extending employee furranging
imposed in midMarch, when the pandemic started to batter the economy.
“We did not and could not have foreseen how broadly and deeply the COVID-19 pandemic would spread and affect our business,” Diplomat general manager Laurens Ziernen wrote on July 6. Government restrictions such as social distancing, capacity limitations and limits on large public gatherings have all combined to limit the resort’s business and placed the reemployment of nearly 1,000 workers on hold, he said.
The Renaissance Plantation, which is furloughing 80 people, is extending the workers’ hiatus by six months due to “the unprecedented length of the pandemic and continued downtown of the travel and hospitality industry,” said owner White Lodging Services Corp. of Indiana.
An upside
The Greater Fort Lauderdale Convention and Visitors Bureau sees an upside through recent hotel reopenings and new construction projects in 2021.
“Existing hotels that had closed are reopening, and we think that the new construction of hotels on the horizon could be a symbol of a positive outlook for our local hospitality industry,” Kara Franker, senior vice president of marketing and communications at the bureau, said in an email. She said 16 hotels with 1,974 rooms are under construction.
But Dobrikow sees more potential for industry consolidation by the time the pandemic passes.
“I think it’s going to be a long road ahead of us,” he said, with a full comeback dependent on the arrival of a COVID-19 vaccine and a reduction of new cases.