Restaurant Operators Bracing for Another Financial Blow Due to Omicron

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At every turn during the pandemic, the service industry has taken a major blow. Now, with omicron making up more than 73% of all new COVID-19 cases, we’re headed into Christmas and the New Year with renewed concerns about survival.

Michelle Schexnayder is the general manager at The Tipsy Oak in Arlington. She said it takes grit, especially now, to keep a restaurant afloat.

“There’s definitely a massive upper-lip sweat on the daily basis,” she said. “You’re doing whatever needs to be done.”

The Tipsy Oak has been fortunate to survive the last year and half, which brought on a massive COVID-19 case surge and stay-at-home orders. Now, there’s a new highly transmissible variant, wary consumers, and a labor shortage to contend with.

“It’s a grind. When there’s not enough people, it’s working those doubles, working those 15-hour shifts and going to sleep, getting up, doing it again,” Schexnayder said.

Kelsey Erickson Streufert is Chief Public Affairs Officer with the Texas Restaurant Association. She said the pandemic has all but devastated the service industry.

“The holiday season is always a really critical time for restaurants to generate revenue,” she said. “We’re gathering, we’re celebrating and we’re spending a lot of time in restaurants or getting food from restaurants, which is exactly what we need after nearly two years of a pandemic.”

But there’s uncertainty about whether this will be the holiday season that turns things around.

According to a survey conducted by the association, 91% of Texas restaurant operators said their restaurant experienced a decline in on-premise dining as a result of the delta variant. Some 89% of state operators say profit margin is lower than it was prior to COVID-19.

“If we see that kind of impact again with the omicron variant, especially during this holiday season, that’s going to be a real challenge for many of our smaller, more independent restaurants that have really struggled over the past year and half,” said Streufert.

The labor shortage also continues to be one of the industry's top challenges. Some 78% of state operators said they still don’t have the workforce needed for the current demand.

For Streufert, part of surviving the holidays with the omicron variant means digging in and adapting.

“More and more restaurants are finding that they have to offer multiple platforms to connect with their customers,” she said.

She said industry leaders are also calling on Congress to replenish the Restaurant Revitalization Fund – a part of the American Rescue Plan Act to help restaurants keep their doors open with grants. They argue only a small fraction of the restaurants that applied received financial relief. Streufert said roughly 12,000 Texas restaurants that applied did not get funding.

Perhaps, though, it’s not just grit that gets them through, but a healthy dose of optimism. A belief that the restaurant industry has way more than a meal to offer.

“You kind of feel like you’re creating something,” said Schexnayder. “A place for people to be happy for a little while before they have to get into the rest of the world and deal with all that stuff.”

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