A new forecast projects that one in three US restaurants may close permanently this year, showing how the Covid-19 pandemic is decimating an industry that employs millions of Americans.
As many as 231,000 of the nation’s roughly 660,000 eateries will likely shut down this year, according to an estimate from restaurant consultancy Aaron Allen & Associates provided to Bloomberg News. This will bring the industry’s steady growth to a halt and mark the first time in two decades that US restaurant counts don’t climb. Restaurants have already shed millions of jobs this year, economic data show.
In addition, Aaron Allen & Associates calculates that more than 8,000 restaurants in the US have already been directly affected by an employee with coronavirus.
The forecast portends a fundamental change for an industry that for generations has been a bedrock of local economies. Restaurants – long a key source of employment and income for Americans from all backgrounds – are facing new hurdles as data show that infection rates have spiked in the states that were first to reopen sit-in dining, such as Georgia, Texas and Florida.
“We’re talking a slow journey back for restaurants to be where they were before the pandemic, and that will take several years to work out,” said University of Michigan economist Richard Curtin, who has studied consumer behaviour for decades.
Covid-19 cases rose in tandem with customers entering restaurants, according to data provided to Bloomberg by Zenreach, which uses wireless signals from cell phones to monitor traffic. But after reports of rising cases emerged, walk-in traffic turned down, the data show. That doesn’t necessarily mean going to restaurants is sparking more coronavirus spread, but it does show how comfortable customers in those markets feel about leaving the house in general.
These patterns – rising virus cases, retrenching customers, restaurants closing – may spark an enduring change in consumer behaviour. Additionally, capacity restrictions can make it difficult or impossible for restaurants to turn a profit.
Zenreach chief executive John Kelly said restaurant walk-in traffic in Georgia, Florida and Texas is currently at half of what it was a year ago. But this includes an upturn of more than 20 per cent since May 1, he said.
Miami’s mayor in July forbade indoor dining after a Covid-19 surge. The governor of Texas, meanwhile, ordered restaurants to cut back to 50 per cent capacity. In Atlanta and Houston, dozens of established eateries have shut down permanently despite their states being among the first to offer sit-down dining.
JPMorgan Chase in June found the level of in-person spending in restaurants was the strongest predictor of where new cases would emerge. In a follow-up July report, the bank said the correlation still held but was weakening as consumers embraced more precautions such as wearing masks.
For Emory University economist Tom Smith, the rush to reopen was unrealistic from the beginning.
“In every economic shock, you cannot move forward until you have controlled the shock,” he said, comparing Covid-19 to a devastating storm. “You want to get back to normal in the middle of a hurricane – it’s not going to happen.”
The economic impact of restaurant closures will reverberate beyond the industry itself, which accounts for nearly 4 per cent of US gross domestic product and employed about 8 per cent of America’s labour force before the pandemic.
On a personal level, Mr Smith said he hasn’t been inside a restaurant since early March.
“People are changing their behaviour radically,” he said.
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Day 5, Abu Dhabi Test: At a glance
Moment of the day When Dilruwan Perera dismissed Yasir Shah to end Pakistan’s limp resistance, the Sri Lankans charged around the field with the fevered delirium of a side not used to winning. Trouble was, they had not. The delivery was deemed a no ball. Sri Lanka had a nervy wait, but it was merely a stay of execution for the beleaguered hosts.
Stat of the day – 5 Pakistan have lost all 10 wickets on the fifth day of a Test five times since the start of 2016. It is an alarming departure for a side who had apparently erased regular collapses from their resume. “The only thing I can say, it’s not a mitigating excuse at all, but that’s a young batting line up, obviously trying to find their way,” said Mickey Arthur, Pakistan’s coach.
The verdict Test matches in the UAE are known for speeding up on the last two days, but this was extreme. The first two innings of this Test took 11 sessions to complete. The remaining two were done in less than four. The nature of Pakistan’s capitulation at the end showed just how difficult the transition is going to be in the post Misbah-ul-Haq era.
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- DLD registration fee can be paid through banks or credit cards at zero interest rates
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Common OCD symptoms and how they manifest
Checking: the obsession or thoughts focus on some harm coming from things not being as they should, which usually centre around the theme of safety. For example, the obsession is “the building will burn down”, therefore the compulsion is checking that the oven is switched off.
Contamination: the obsession is focused on the presence of germs, dirt or harmful bacteria and how this will impact the person and/or their loved ones. For example, the obsession is “the floor is dirty; me and my family will get sick and die”, the compulsion is repetitive cleaning.
Orderliness: the obsession is a fear of sitting with uncomfortable feelings, or to prevent harm coming to oneself or others. Objectively there appears to be no logical link between the obsession and compulsion. For example,” I won’t feel right if the jars aren’t lined up” or “harm will come to my family if I don’t line up all the jars”, so the compulsion is therefore lining up the jars.
Intrusive thoughts: the intrusive thought is usually highly distressing and repetitive. Common examples may include thoughts of perpetrating violence towards others, harming others, or questions over one’s character or deeds, usually in conflict with the person’s true values. An example would be: “I think I might hurt my family”, which in turn leads to the compulsion of avoiding social gatherings.
Hoarding: the intrusive thought is the overvaluing of objects or possessions, while the compulsion is stashing or hoarding these items and refusing to let them go. For example, “this newspaper may come in useful one day”, therefore, the compulsion is hoarding newspapers instead of discarding them the next day.
Source: Dr Robert Chandler, clinical psychologist at Lighthouse Arabia
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Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
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5. Australia
6. Samoa
7. Kenya
8. Scotland
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10. Spain
11. Argentina
12. Canada
13. Wales
14. Uganda
15. United States
16. Russia
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Most fours: 491 – Gautam Gambhir
Highest individual score: 175 not out – Chris Gayle (for Royal Challengers Bangalore against Pune Warriors in 2013)
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Size: 300 employees
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Investors: Technology Development Fund, Silicon Badia, Beco Capital, Vostok New Ventures, Endeavour Catalyst, Crescent Enterprises’ CE-Ventures, Saudi Technology Ventures and IFC
Our legal advisor
Ahmad El Sayed is Senior Associate at Charles Russell Speechlys, a law firm headquartered in London with offices in the UK, Europe, the Middle East and Hong Kong.
Experience: Commercial litigator who has assisted clients with overseas judgments before UAE courts. His specialties are cases related to banking, real estate, shareholder disputes, company liquidations and criminal matters as well as employment related litigation.
Education: Sagesse University, Beirut, Lebanon, in 2005.
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What is THAAD?
It is considered to be the US's most superior missile defence system.
Production:
It was created in 2008.
Speed:
THAAD missiles can travel at over Mach 8, so fast that it is hypersonic.
Abilities:
THAAD is designed to take out ballistic missiles as they are on their downward trajectory towards their target, otherwise known as the "terminal phase".
Purpose:
To protect high-value strategic sites, such as airfields or population centres.
Range:
THAAD can target projectiles inside and outside the Earth's atmosphere, at an altitude of 150 kilometres above the Earth's surface.
Creators:
Lockheed Martin was originally granted the contract to develop the system in 1992. Defence company Raytheon sub-contracts to develop other major parts of the system, such as ground-based radar.
UAE and THAAD:
In 2011, the UAE became the first country outside of the US to buy two THAAD missile defence systems. It then stationed them in 2016, becoming the first Gulf country to do so.
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Company name: Nybl
Date started: November 2018
Founder: Noor Alnahhas, Michael LeTan, Hafsa Yazdni, Sufyaan Abdul Haseeb, Waleed Rifaat, Mohammed Shono
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In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
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Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
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She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
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