North American Food Sector Decimated by Coronavirus

Survey data of the US and Canadian food service industry reveal major losses.
Survey data of the US and Canadian food service industry reveal major losses.

One of the hardest hit industries during the coronavirus pandemic has been the food service sector. Across the US and Canada, restaurants, bars, pubs and any food business that does dine-in service have had to close their doors and stop serving customers on the premises. The logic behind the decision is sound - by closing these locations, large gatherings of people will be be stopped and physical distancing will be maintained. The end goal is to stop the spread of COVID-19 before it becomes too difficult for the health system to manage. But at what impact to food business owners, managers and employees?

The first few weeks of March saw businesses shut their doors, with some slowly beginning to switch to take-out or delivery models. There wasn’t a clear picture of what the situation would look like in the near-future, or what these changes would mean for the food service industry in the long run. Weeks later, the data available illustrates just how much COVID-19 has damaged the food service industry in North America.

Surveys conducted across the US and Canada show that upwards of $29 billion in revenue was lost last month alone across the food service sector. This figure is comprised of $4 billion in lost sales in Canada, and $25 billion in lost sales across the US. Figures are expected to worsen throughout April as food businesses remain closed for the entire month.

Infographic: Impact of COVID-19

The number of food businesses temporarily closing their doors is comparable across the US and Canada. In March, 53% of Canadian food businesses and 44% of US food businesses had temporarily closed due to COVID-19. Others have closed their physical premises, while still providing take-out or delivery. While this has helped some food businesses continue to bring in some form of revenue, it has not come without costs. The surveys indicate that many businesses had to reduce their operating hours, with 46% of Canadian businesses and 60% of US businesses doing so in the month of March.

Alarmingly a number of food business have already closed their doors for good. In Canada, 10% of food businesses had permanently closed in March, while in the same month 3% of US food service businesses had done the same. 18% of Canadian food service businesses and 11% of businesses in the US expect to be forced to close for good by the end of April.

The impact on employment has been staggering. Immense numbers of jobs have been lost, and this is expected to continue for the foreseeable future. The figures state that the US lost 3 million food service jobs in March, while 800,000 Canadian food service workers were also made unemployed.

There’s no doubt when looking at the data that the food service industry is being decimated by COVID-19. The numbers around lost revenue, closed business and job losses are extraordinary and are only set to worsen in the immediate future. Even when restrictions are lifted, questions remain around how long it will take for consumers to be comfortable dining in restaurants again. The final figures will continue to reveal themselves as the coronavirus pandemic maintains its hold on the North American food industry.