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US Restaurants Expect Sales To Remain Muted Through End Of Year

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A new survey by the National Restaurant Association or NRA has painted a grim picture regarding the outlook for the U.S. restaurant industry.

According to the NRA's Restaurant Industry Tracking survey for May 2020, most restaurant operators in the U.S. said they do not expect their business to return to normal during the next several months. Instead, they anticipate sales, employment and capital spending levels to remain dampened through the end of this year.

The restaurant industry, the second-largest private-sector employer in the U.S., is among the worst hit by the coronavirus pandemic. Restaurant operators nationwide have reported sharp declines in sales and employment levels in recent months due to the coronavirus-induced lockdowns.

According to the May survey, 73 percent of restaurant operators said they expect lower sales volume in the next six months compared to the year-ago period. Only 17 percent think their sales for the six-month period will rebound above year-ago levels.

On the segment level, operators in the tableservice segments were the most pessimistic about improving business conditions. 92 percent of fine dining operators and 84 percent of casual dining operators said they expect their six-month sales to remain below previous-year levels.

50 percent of quick-service operators and 42 percent of fast casual operators also do not expect their sales to recover by late-2020.

In addition, most restaurant operators anticipate a very slow return to pre-coronavirus staffing levels. 66 percent of restaurant operators expect their staffing levels in six months will be lower than it was during the prior-year period, while only 17 percent expect their staffing levels to exceed year-ago levels.

All the fine dining operators as well as eight in ten family dining and casual dining operators said they expect to employ fewer people in the next six months than they did in the prior year.

More restaurant operators now intend to put their capital expenditure plans on hold. Just 27 percent of respondents now say they plan to make a capital expenditure for equipment during the next six months, down sharply from the average of 54 percent of operators who reported similarly in the January-March tracking surveys.

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