April job losses fall hard on restaurants, retailers

NEW YORK, May 19, (AP): Who remembers their last meal at a sitdown restaurant? Better yet: who knows when their next one will be?

That’s the question bedeviling not just diners but Wall Street, where analysts and investors have seen investments in publicly traded restaurant chains like Olive Garden, Denny’s and KFC owner Yum Brands crater amid shutdowns forced by the global coronavirus pandemic.

While some states like Georgia and Texas have recently taken tentative steps to permit restaurants, shops and other businesses to reopen, the sector remains in deep crisis. Of the more than 21.4 million jobs lost since the pandemic struck the U.S. in March, 28% of them are in the restaurant and bar industry and another 10% are in retail.

“Following a natural disaster, restaurants are the last businesses to reopen and to start recovery,” the National Restaurant Association said in a statement. “This is a nationwide disaster that’s going to need a nationwide plan for restaurants to recover.”

Orlando, Florida-based Darden Restaurants, which owns the Olive Garden and LongHorn Steakhouse chains, told investors its sales had already fallen by nearly half in its current quarter, with one month left to go. Denny’s sales were 76% lower in April alone. Both restaurant chains have cut staff as demand plummeted.

Retailers, especially those focusing on clothing and apparel are also hurting. Kohl’s shut down stores nationwide in March and only started reopening in some states earlier in May. Gap took similar measures, shutting down stores and furloughing workers.