It's hard to overstate the impact COVID-19 restrictions have had on the hospitality industry. A survey by the National Restaurant Association found about 80% of Oregon's restaurant workers have lost their jobs. And while some restaurants are still offering take-out, or are preparing to reopen when they're again allowed to seat patrons, a growing number have decided to permanently close their doors.
Downtown Portland’s Clyde Common, which won accolades for its cocktails before the pandemic closed its doors, is among those that will not be back. Co-owner Nate Tilden said after he did the math, a return to the old way of business just did not add up.
"Restaurants run on very tight margins. If you're running at 7% or up to 10%, then you're doing pretty well. And it really came down to the simplicity that we're not going to have the number of customers walking through our door that we used to have – our government's not going to allow that," Tilden told "Think Out Loud."
“When we get the green light to reopen, if we brought back the entire staff and we tried to function in that full-capacity way, then we’ll be done in three weeks, done and bankrupt, meaning our bank accounts will be at zero and I’ll have a ton of debt,” he said.
The considerations at Propserity Pie Shoppe in Portland’s Multnomah Village were different – but the conclusion co-owner Amy Jaffe drew was the same.
The business had already suffered two economic hits over the past year – an oven fire in spring 2019 forced a monthlong closure, then road construction limited access to neighborhood businesses a few months later.
“We began to recover in the wintertime and going into 2020 – and then this hit,” Jaffe said.
Much as people with pre-existing health conditions have fared worse when infected with the coronavirus, the pre-existing financial struggles that Prosperity Pie was facing made COVID-19 closures more than the business could overcome.
“When COVID hit us, we had to come to the answer that we need to close permanently,” Jaffe said. “It was really hard, and we miss our community so much.”
Yet Tilden, who co-owns several other restaurants in Portland, said he believes there are some food-service models that could potentially thrive in the post-pandemic era.
He is also an owner of Olympia Provisions, a charcuterie and meat-focused restaurant with multiple locations across Portland, which also operates as a supplier to supermarkets. He said he expects at least some of that local chain’s smaller-format eateries to return when they’re allowed.
“The bigger the restaurant, the bigger the challenge, and it really comes down to real estate,” Tilden said.
Clyde Common operated across two floors and required high staffing levels so servers could see and attend to all tables, he said.
Although the Clyde Common that customers once loved will not return, he said he hopes to remodel the space to allow for the creation of a market and a smaller tavern-style restaurant.
“A restaurant like Olympia Provisions Southeast, I think we could run with one or two cooks and one or two people taking orders – so four people on staff. That’s an overhead of, let’s say, generally $500 to $600 in labor per shift,” Tilden estimated. “If you’re running a labor cost of 30%, can we bring in $1,500 in gross sales at OP Southeast to make that business break even? My feeling is, yes we can.”
Tilden noted that overhead is much more than just payroll — “rent, utilities bills, insurance services, garbage, linen” and more. And with those extra costs, he expects Olympia Provisions restaurant locations will break even, at best.
“We’re not gonna be profitable for a long time,” he said.
It’s a brutal calculus for the thousands of restaurant workers seeking unemployment benefits now, and wondering what the future will bring.
Erika Goldin-Jones has worked in food service for about 15 years, most recently managing the wine program at Clyde Common. She said she understands the financial reasons that her job is not likely to return – but she does not know what that will mean for the rest of her career, or if she’ll even be able to continue in the field.
“It’s hard knowing that we’re no longer going to exist in the same way. It kind of feels like the era of the bustling restaurant is ending – but I don’t know if that’s really true. I don’t think anyone really knows,” Goldin-Jones said.
“The rhetoric right now is of this ‘pandemic pivot’ that we’re all supposed to be navigating, and whether that means we should be shifting our goals and our ideas of what the future is,” she said. “But, I mean, I can say that I can’t really see myself doing anything else right now. I really love the industry, and I’m just gonna have to see what happens.”