Pulse Check: Dog days of Coronavirus in the hospitality industry

As restaurants reopen across the country, hospitality suffers as Coronavirus cases surge.

Since mid-March, most hospitality workers have been in quarantine due to the Coronavirus pandemic. The unprecedented event has shut down businesses, schools, and organizations across the globe to flatten the curve, which led to many business closures and economic woes on a global scale. With countries and states trying to get businesses “back to the new normal,” phased approaches to public and social discourse are being constructed and rearranged on almost a daily basis.

With every municipality operating under its own unique set of rules and guidelines, the hospitality looks very different across the United States. It just depends on where you are.

Texas’ spike in coronavirus cases (and wonky rules)

Greg Abbott, the governor of Texas, was one of the first states to push reopening efforts back in May. Most notably, Abbott squashed the attempts of local governments to contain the spread of the virus by saying the government could not enforce the wearing of masks to citizens. Now, the state is seeing a dramatic surge in Coronavirus cases having more than quadrupled its numbers since June after reopening hospitality establishments to the public. The governor is changing his tune after numbers hit an all-time high: 7,890 patients after 238 new admissions in 24 hours.

A new mask order just took effect (applies to counties with at least 20 positive COVID-19 infections) and people can be subjected to fines if they don’t comply. The food/beverage industry was hit with a limited dine-in capacity of 50%. And though this has been proven to slow the spread of the virus, it contradicts a resolution that just passed just days after to continue with an in-person trade show-size event at the George R. Brown Convention center in mid-July. About 6,000 people are expected to attend the Texas Republican Convention there, contingency plans in talks on the side.

It would be fair to say that hotels, restaurants, event centers, vendors, and coordinators are all holding their breath right now—unclear if they should prepare for meals, accommodations, and entertainment for thousands of guests, or a complete shutdown. The outlook for both the health of the public and the hospitality industry, at least in Texas, is not so good. We think a rollback to a more cautious phase is in store.

Florida 5-digit record number of cases per day for over 3 days in a row

Packed Florida beaches are a common sight during the pandemic.

According to the New York Times, Florida's confirmed coronavirus cases rose by a record 11,458 on Saturday, the state's health department said, marking the second time in three days that its gone up by more than 10,000 in 24 hours. In Orlando alone, nearly 60 percent of all cases diagnosed in that county came in just the past two weeks.

The state recently reopened bars, restaurants, gyms and other hospitality establishments like casinos, and similar to Texas, the Sunshine State intends on hosting a twice-as-large event in Jacksonville for the Republican National Convention.

Now that the state is setting daily records for coronavirus cases, hospitals are sending warnings that they are coming close to reaching capacity. Masks are required in all indoor public venues and state officials rolled back the sale of alcohol in bars to try and reduce public foot traffic.

Reopening efforts have not gone well for the second and third most populated states. We could be seeing another rollback, particularly for the travel, leisure, and restaurant industries unless they impose stricter guidelines when it comes to public and social interaction.

California and New York halt indoor activity reopening plans

California and New York were hardest hit at the initial Covid-19 outbreak and took extreme precautions on reopening, setting phased timelines for public interaction. Having seen the deadly numbers on the incline in Texas and Florida as a result of reopening without proper guidelines, they’re restricting public dining and other indoor activities at this point in time.

New York has strict public orders in place.

The bottom line is that the pandemic is far from over. We will continue to see a spike in cases and deaths, so long as we people are allowed to interact freely in public. Unfortunately for the hospitality industry, that means many adjustments to new protocols and capacity limits, and even fines for those who don’t comply.

Jot Condi, head of the California Restaurant Association, told the New York Times, “This will be the last straw for a lot of restaurants.” The business disruptions could lead to defaults on payments to landlords, vendors, and suppliers in many hospitality businesses.

What’s next for the hospitality industry?

U.S. Treasury Secretary Steven Mnuchin said recently that there was a lot of support to repurpose funds authorized under the $660 billion Paycheck Protection Plan to be redirected to restaurants, hotels, and other industries under the umbrella of hospitality. With almost 20 million people in the United States out of work, and coronavirus cases on the rise, we expect there to be more attention being paid to the industries that have been crippled or closed in order to comply with health and safety guidelines.

With the phases at different stages in different states, it’s hard to say what the outcome will be. Check in with us at the next Pulse Check.