The Louisiana Restaurant Association predicts a 25-30 percent drop in restaurant revenue for 2020 due to the pandemic.
LRA CEO Stan Harris says they projected 11 billion dollars for the year before the pandemic, generating over a billion dollars in state and local taxes. Harris says that’s no longer the case, and government budgets are going to being taking a hit as a result.
“That’s going to reduce those taxes that local communities and the state depend on to sustain their operation,” says Harris, who made the comments on Talk Louisiana Monday.
The National Restaurant Association is projecting a 240 billion dollar nationwide impact to revenue for 2020.
LSU Economist Dr. Loren Scott says the industry is particularly vulnerable because demand is currently being dictated by the public’s level of comfort in going out to eat.
“The second wave must have really been just a crusher to the spirits of the restaurant industry because just as they thought they were coming out of it, now they have to go back into it,” says Scott.
Harris previously predicted 25 percent of state restaurants could permanently close due to the pandemic. Scott says much of that is linked to problems making rent.
“Their problem is they can reduce the number of servers, but they cannot reduce that fixed cost and that is what is nailing a lot of them right now,” says Scott.
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