Restaurants and bars rehired 1.4 million workers, recovering 23% of the decline in the prior two months. This is outpacing gains in restaurant traffic, measured here by OpenTable, seemingly showing PPP funds are being used to pay people to do less work. If the recovery in restaurant traffic continues as it has so far in June, we should expect to see even more workers rehired.
What a great thing! It seems clear that if people can remain attached to their employer through this trough in activity, with government support, the worst-case scenarios are off the table. On the other hand, PPP funds help businesses maintain temporary liquidity, but don’t guarantee their viability under reduced capacity in coming months. CoStar says restaurants can’t operate this far below 100% capacity for long. The job gains for May represent more of a stimulus story than a return of demand story.
