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Again, as the COVID War 2.0 began to heat up in May, we had forecast an economic slowdown. Today the U.S. Commerce Department reported that consumer spending in both retail and in restaurants declined in July. While still up and growing, restaurant and bar sales increased at lower rates than they did in June.
After seeing diners flooding back after COVID-related restrictions were lifted, restaurants are now seeing business soften as people stay away for fear of catching the COVID virus’s virulent Delta variant, according to the Wall Street Journal.
The city of Los Angeles reimposed an indoor mask mandate on 15 July; during the week ending 1 August, restaurants there saw 17 percent fewer diners compared with the same time in 2019, according to mobile device location data from research firm Placer.ai.
The city is mulling a requirement that people entering public indoor spaces also show proof of having received at least one dose of COVID vaccine.
On 9 August, the city of New Haven set a new indoor mask mandate, saying that cases were on the rise and that vaccinated persons still could spread the Delta virus.
New York City’s new requirement that people dining indoors show evidence of at least one dose of vaccine took effect 16 August; San Francisco has announced a similar rule.
Nationally, for the week ending 25 July, same-store restaurant sales experienced their worst week of the last five, analytics firm Blackbox Intelligence reported, also sales were still greater than the same time window in 2019.
Some restaurateurs are contemplating putting Plexiglass screens back between tables and marking social distances on floors, the WSJ reported.
“It’s challenging,” David Boenigghausen, CEO of the chain Noodles & Co., told the WSJ. “We’re all tired of this.”
TRENDPOST: Restaurants are a leading indicator of economic trouble ahead. If diners are not dining out, other business from hospitality, travel, tourism, convention, trade show, concerts, and other socially driven sectors will decline.
Weak restaurant sales presage economic decline for much of the overall economy. Indeed, even the big winner of COVID War I, online shopping took a hit with spending at online and other nonstore retailers falling 3.1 percent.