Coronavirus and Restaurants: A Year In Review

A year ago this month, our industry was rocked to its core. After a few weeks of uncertainty in February and early March 2020, COVID-19 was declared a pandemic on March 11, 2020, by the World Health Organization. America and Canada soon followed suit by declaring states of emergency, effectively turning all restaurants into takeout-only businesses. Restaurant foot traffic disappeared overnight. Offices were closed, rendering city centers into ghost towns. And a general fear of going out, at least early on, contributed to a dramatic drop in sales across the entire restaurant industry—one we’re still recovering from a year later.

In order to support the restaurant industry through uncharted waters, our team at 7shifts has worked together to derive important labor trends and insights from our network of restaurant pros.

Here’s the story of the year so far, through the eyes of 7shifts 500,000 restaurant users. Despite what the industry has been through, looking back can help us find ways to adapt today and prepare for the future.

How restaurant sales were impacted

Shortly after lockdowns were initiated, restaurant sales across the board—from full-service dining to coffee shops—took a nosedive. It hit a fast low on March 22, 2020 — with the industry as a whole seeing a 77% drop in sales. Bars and nightclubs were hit the hardest—an 89% drop in sales. Full-service restaurants weren’t far behind at an 81% drop in sales.

From then on, as we eased into lockdowns and got used to ordering in or eating outside, sales began a steady climb back up where they plateaued for the summer. Outdoor dining, warm weather, and a decline in virus cases helped the industry. Quick service restaurants recovered to a higher rate — between 7% and 10% over full service. Breweries and Taprooms were close to pre-pandemic levels by the end of summer—dude to to-go cans and outdoor seating. Pizzerias fared better than most—as takeout was built in many of their business models to begin with. They didn’t dip as much and recovered quicker. But the unsung hero of the pandemic was juice bars—which saw a significantly faster recovery than any other industry sector—and surpassed pre-pandemic levels by June of 2020. As it turns out, the healthy juice business is a good one to be in during a pandemic. And people really love pizza.

Cold weather decline

The return of cooler temperatures in September, as well as rising cases along with it in some parts of the country, had restaurants once again declining in sales. Some states had returned to stay-at-home orders, and dining rooms were once again shut down. A rise in cases in-and-around the holidays, as well as cold weather keeping patios empty made for a darker December and January for many restaurants. A shortage of patio heaters left some restaurants without the option. Some had to get creative with their outdoor seating and greenhouses, yurts, and igloos became the way to dine out. And while it helped keep some restaurants afloat, recovery saw some setbacks.

 

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A vaccine spring

Despite a dip in recovery in the winter, all signs point to a full recovery sometime this year—spurred by a vaccine spring. As of the time of writing, more than 100 million vaccines have been administered. New York City—the dining capital of the country—has returned to 50% capacity indoor dining, its highest since the start of the pandemic. The US government has also come in with a life raft for struggling restaurants in the form of $28.6 billion in grants for food service establishments. Some restaurants can receive up to $5 million to help pay staff, bills, and stay open. Total industry sales have seen a steady rise since the end of January, and 283,000 new jobs were added back to the industry in February 2021.

How restaurant staffing has changed

As the industry’s sales took a hit, as did the number of jobs in the restaurant industry. Although the Paycheck Protection Program came later in the spring, it was too late to save hundreds of thousands of industry jobs.

Alongside the industry’s sales, we saw a sharp, stark decline in jobs, hitting a low point on April 12, 2020, with 75% fewer jobs than just 6 weeks prior. 7shifts data points to a steady rise in shifts from that point, with a summer plateau that mirrors that of sales. From there, the shifts are mostly in-line with that of sales—a winter drop followed by a steady rise to where we are now. All signs point to an industry recovery sometime this year, and restaurant workers are among the first of us to get vaccinated, due to their classification as essential workers.

Delivery shifts into focus

Out of all of the metrics that took a sharp decline in early March of last year, there was one that took a sharp incline: delivery roles. With dining rooms closed, the share of shifts that were related to delivery operations increased by 22% early on in April. That percentage has fluctuated quite a bit throughout the year but has remained in the 9% to 21% higher than pre-pandemic levels since that initial spike.

Closing Thoughts: A pandemic year

From losing 75% of sales in a week to building outdoor seating to vaccines and relief on the horizon, it’s been quite the year for the restaurant industry. When we look back upon, however, we will see it as an accelerator of change within the industry: a shedding of what didn’t work and a full embrace of technology and the future of hospitality. The data shows a steady rise in restaurant sales, shifts scheduled, and in reservations. The consumers appetite for restaurants hasn’t gone away, and our reward for making it though the pandemic will be a stronger industry, one ready for another Roaring ’20s.

About This Data

This dataset is based on insights from 7shifts 400,000 restaurant users that work in 17,000 locations across the United States as of March 2021. All rates that compare day or median are based on the period of January 2020.

• “Hours and shifts scheduled” are calculated from the hours and shifts recorded in 7shifts
• “Back of house and Front of house shifts” are based on the schedule type in 7shifts
• “Active Users” are based on the number of employees with shifts scheduled on a daily basis
• “Sales” are based on sales for each location on a daily basis