Before the COVID-19 crisis, the Illinois Restaurant Association (IRA) represented the largest private-sector employer in the state—with 594,000 people employed at more than 24,000 eating and drinking establishments across Illinois. The restaurant and hospitality industry, however, has been absolutely devastated by the pandemic. Restaurants were the first to close, and likely will be the last industry to fully reopen and recover.
Restaurant sales are down 70 to 80 percent across the board in Illinois right now. Eighty-six percent of restaurant operators say it is unlikely they will be profitable in the next six months, while 98 percent say they have laid off or furloughed employees. About 321,000 restaurant employees in Illinois were laid off or furloughed at the height of the pandemic, while 70,000 industry workers remain unemployed.
Sadly, we estimate that at least 20 percent of restaurants will never reopen. Restaurants operate on extremely low profit margins—their business models were not designed for low occupancy. On average, 95 to 97 cents of every dollar a restaurant takes in goes back into the food, employees and overhead. This is during “normal” times, so that squeeze of making every penny count is amplified through the roof now.
Even with sales down, the rent is still due, team members must be paid, and invoices from vendors are piling up. And there are no simple answers to these challenges. The IRA continues to collaborate with our partners and elected leaders, providing all the resources at our disposal to help restaurants get through these challenging times.
“The restaurant industry has always been full of creativity, flexibility and grit. Those qualities are now, more than ever, a requirement to survive,” says Jordon Brotherton, clinical assistant professor in the University of Illinois Department of Nutrition and Food Science. “While it is heartbreaking to see so many restaurants closing their doors, I take great pride in those that have found success through change.”
The Challenges of Reopening
Illinois’ restaurants have been eager to welcome back customers, and we’re doing it in a safe and smart way. Public health and safety continues to be the top priority to keep our guests and team members safe. Restaurants have been strictly following the necessary guidelines, and any bad actors face serious fines or closure. The industry was already extremely health-focused—and that is in hyperdrive now. Social distancing, face coverings and PPE are imperative to moving the state forward. We’re also very progressive in Illinois when it comes to food safety; every worker in the industry must be trained in food handling, sanitation, alcohol service and allergen awareness.
“The past six months represent the most challenging time restaurant owners and operators have ever seen,” Brotherton notes. “Successfully weathering extreme fluctuations in revenue, quickly pivoting to a carryout and delivery model, navigating a number of new regulations and requirements, and somehow continuing to provide customers with a safe and enjoyable dining experience is nothing short of miraculous.”
Most diners are happy to be out at their favorite restaurants again and respectful of mask requirements and other safety guidelines. However, building consumer confidence back up is both a challenge and a gradual process. We need to keep driving home to all diners that extra safety precautions are necessary so we can stay on a steady path and keep up our progress with reopening. Closing down again would be absolutely devastating for restaurants that are struggling to survive.
The IRA has been at the forefront leading our industry throughout the pandemic. We have worked with Governor Pritzker and state leaders to expand outdoor dining options, allow for the sale of cocktails to-go, provide additional payment flexibility between retailers and liquor distributors, offer grants to small restaurants, and more. We’ve also opened up our breaking alerts and resources to all restaurant operators and vendors around the state. Restaurants are looking for help and guidance, and the IRA is here to provide it.
“A big thank you to the Illinois Restaurant Association, not only for opening up their resources to non-members, but also for collaborating with University of Illinois Food Science and Human Nutrition faculty and so many others to bring crucial resources to restaurants during the pandemic,” says Kathleen Brown, community and economic development educator with University of Illinois Extension.
We have work to do collectively to get our COVID-19 numbers back down and build on our reopening progress. The IRA is having conversations with local and state leaders to make sure we can be creative, innovative and flexible on outdoor dining—tents, heaters, bubbles, expanded footprints… whatever it takes. In addition, we recently launched the IRA Educational Foundation Employee Relief Fund to provide direct financial support to industry professionals in need of assistance during this crisis. If you or an employee you know in the hospitality industry needs support, or if you are interested in getting involved with the fund, please reach out to the Association team anytime.
How to Help
The challenges faced by restaurants around Illinois are not unique; they are happening across the country. These nationwide, industry-wide challenges require federal solutions, complemented by pragmatic policies at the local and state levels. The IRA has been working with the National Restaurant Association and our state restaurant association partners on a Blueprint for Restaurant Revival—a plan calling for a variety of short, medium and long-term reforms and relief measures to support the nation’s restaurant and hospitality industry.
Included in the plan is the creation of a $120 billion Restaurant Recovery Fund for structured relief to help restaurants get the liquidity they need to adapt, rehire and eventually reopen. Anyone can help these efforts by taking a minute to text “REVIVAL” to 52886 to tell Congress you support the Blueprint.
We recognize the severe financial challenges our state and local governments face which make it difficult for our industry to receive direct financial relief. But more help is needed across the board. Everything needs to be on the table, and we need leaders at all levels to continue thinking outside the box for ways to help the industry get through this. “Even though restaurants may have found a way to make payroll and keep the lights on through this point in time, they still need a lot of help,” Brotherton adds. “Continued support from federal and state governments, organizations like the Illinois Restaurant Association, and customers will be critical to their future viability.”
There are a few things every person in Illinois can do to help your local restaurants and bars right now.
- Order from your favorite restaurants. Go to the ones you’ve known and loved for years—as well as the new place around the corner.
- Buy gift cards. Even if you can’t get out for a nice lunch or dinner—or aren’t ready to dine out yet—you can help give that restaurant a little bit of revenue that they desperately need.
- Consider adding a cocktail, beer or bottle of wine to your order. These items supplement food orders and go a long way toward supporting a restaurant or bar’s bottom line.
- Donate to a restaurant’s employee relief fund, or to a local nonprofit that is supporting the hospitality industry and its employees.
- Please be sure to closely follow public health guidance and house rules when you are dining out. Wearing face coverings, social distancing, showing up on time, staying within designated time limits, and more are all important to keep restaurants running safely and efficiently. PM
Sam Toia has served as president and CEO of the Illinois Restaurant Association since 2012.