Survey: Omicron Hurts Michigan Restaurants, Sales and Profits Decline

The Michigan Restaurant and Lodging Association in Lansing today released new survey data highlighting the devastating impact the omicron variant has had so far, and the positive impact the Restaurant Revitalization Fund (RRF) had on the Michigan industry.
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The Michigan Restaurant and Lodging Association released the results of a survey showing the magnitude and scope of challenges brought on by the omicron variant. // Stock Photo
The Michigan Restaurant and Lodging Association released the results of a survey showing the magnitude and scope of challenges brought on by the omicron variant. // Stock Photo

The Michigan Restaurant and Lodging Association in Lansing today released new survey data highlighting the devastating impact the omicron variant has had so far, and the positive impact the Restaurant Revitalization Fund (RRF) had on the Michigan industry.

According to National Restaurant Association analysis, the first round of RRF funding saved more than 35,000 Michigan jobs and helped 94 percent of recipients of a grant stay in business.

In addition, the survey found:

  • Nearly 43 percent of restaurant operators who did not receive RRF grants feel it’s unlikely that they will stay in business beyond the pandemic without a grant.
  • Ninety-seven percent of restaurant operators who applied for an RRF grant, but did not receive funding, said a future grant would enable them to retain or hire back employees who would otherwise have been temporarily or permanently laid off.

“Our survey delivers reliable data to what everyone in Michigan already knows — that Omicron is closing restaurants and significantly complicating our recovery,” says Justin Winslow, president and CEO of the MLRA. “Fortunately, we have a solution in the Restaurant Revitalization Fund that we know works, but we need Congress to act quickly to supplement its funding.”

The restaurant industry was hit hard by the latest surge of COVID-19 cases caused by the omicron variant, Winslow adds. Forced to adapt to deteriorating consumer confidence, restaurants reduced hours/days of operation, cut seating capacity, and shutdown, pivoting to off-premises dining with the result being lower sales volumes in 2021 than in 2019.

According to the survey:

  • 86 percent of restaurants experienced a decline in customer demand for indoor on-premises dining in recent weeks because of the omicron variant.
  • 76 percent of operators report that business conditions are worse now than three months ago.
  • 78 percent of operators say their restaurant is less profitable now than it was before the pandemic.

“The National Restaurant Association estimates indicate that full replenishment of the RRF will save an additional 50,000 restaurant jobs in Michigan,” Winslow says. “The RRF was a critical lifeline to many of our restaurants, but far more remain on the sidelines, desperately looking for support before they are forced to close their doors forever.

“The decisions Congress could make in the coming weeks will be critical toward the future of many restaurants that serve as the cornerstone of their community.”

The MRLA has issued a call to action, encouraging Michigan residents to urge members of Congress to replenish the RRF and attach the legislation to the upcoming government spending package. For more information, visit here.

The Michigan findings were provided by the National Restaurant Association Research Group, which conducted a COVID-19 Restaurant Impact Survey of 4,200 restaurant operators from Jan. 16-18, 2022.

To access the report, visit here.

Founded in 1919, the National Restaurant Association is the leading business association for the restaurant industry, which comprises 1 million restaurant and foodservice outlets and a workforce of 15.6 million employees. The association sponsors the industry’s largest trade event, the (National Restaurant Association Show); the leading food safety training and certification program (ServSafe); and a career-building high school program called (the NRAEF’s ProStart).

For more information, visit Restaurant.org.

The Michigan Restaurant and Lodging Association is the recognized leader of Michigan’s hospitality industry, providing essential services to the foodservice and lodging community. Founded in 1921 as the association, now known as the MRLA, represents more than 5,000 Michigan foodservice and lodging establishments.

The industry plays an integral role in Michigan’s economy, employing more than 595,000 people and generating nearly $40 billion in annual sales. For more information, visit www.mrla.org and www.detroitrla.org.

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