State trade group works to rescue hospitality industry
North Carolina’s hospitality industry is reeling in the wake of the coronavirus pandemic as Governor Roy Cooper issued stay-at-home orders and restricted restaurants to take-out only options. Lynn Minges, president and CEO of the North Carolina Restaurant and Lodging Association, says the changes have caused a dramatic change for the hospitality industry and many small businesses won’t be able to survive the health crisis.
“The hospitality industry comprises 13% of the state workforce and we have 18,000 food service establishments and 1,800 lodging establishments,” Minges said in an interview hosted by Raleigh-based John Locke Foundation, a nonprofit think tank. “Of those 18,000 food service establishments, all are really shut down today.”
Minges says roughly 75% of the state’s 550,000 restaurant and lodging industry workers are currently unemployed.
“People generally think that just because a hotel or restaurant is flagged with a big brand name behind them that they are a corporately owned, but that is not true across North Carolina. Hotels are owned by small businesses, small business owners,” she says.
Many hoteliers and restauranteurs lack cash to pay for rent, utilities and other expenses to sustain their business, Minges says. The way hotels are financed makes it very difficult to extend bank terms in many cases, while some restaurant members are facing foreclosure or eviction. “Some of those that have shuttered and already closed will not come back, and that’s unfortunate,” she says.
“We hear it’s on the way, but unemployment insurance benefits are slow to come. And even then, there may not be sufficient to replace lost income,” Minges says.
Minges says she’s been “in conversation with the governor’s office nearly every day throughout this, as well as with Speaker [Tim] Moore and Senator [Phil] Berger. They clearly understand the impact this is having on our industry and found them to be very receptive of the kinds of things that could help sustain us through this.”
Minges is lobbying for immediate relief efforts, such as tax deferments, this week. “Many of these businesses say they may be able to cobble together enough to survive for 30 days. Sixty days becomes much more complicated. In 90, almost insurmountable.”
In the meantime, the group is encouraging displaced workers to look for jobs with grocers, delivery service and other companies that are actively hiring. It has also started the NC Restaurant Workers Relief Fund in an effort for impacted employees to still receive their necessities.
Despite the seemingly insurmountable challenges faced by the industry, North Carolina’s small businesses have shown resilience. “I have been just so heart-warmed and impressed by the creativity of many restaurant owners across the state as they have pivoted and changed from the service that they know and delivery everyday to a different model,” Minges says. “Many of them are doing creative things like… trays for take out. They’re changing menus… offering specials… offering things like groceries in their restaurants. It’s life support to keep some of these lights on, some of these businesses operating, even though it’s in a limited fashion and to keep some of our workforce together.”