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By the Numbers: COVID-19’s Devastating Effect on the Restaurant Industry

From canceled dinner plans to delivery app downloads, app data reveal how COVID-19 has brutalized restaurants

As the novel coronavirus has spread across the world, collateral damage has been far and wide, with the restaurant industry sustaining one of the heaviest blows. While on-the-ground reporting is revealing that impact one story at a time, reservation apps, point-of-sale systems, and other tech platforms have effectively captured an enormous snapshot of the tectonic disruption in their databases — painting a quantifiable picture of just how much the novel coronavirus has warped American food culture in the last three months.

January to February: Americans lose their taste for Chinese food

Scientists believe the first COVID-19 outbreak occurred in Wuhan, China. Throughout January and February, it became the epicenter of the soon-to-be pandemic. As awareness of the novel coronavirus and its likely origin grew throughout January, in a xenophobic reaction to the outbreak, some Americans stopped dining at Chinese restaurants, leading many across the country to report steep declines in business; some have since closed.

Typically, around the Lunar New Year, there’s an uptick in Yelp searches for Chinese restaurants. In 2019, there was a 56 percent boost in Yelp searches on the first day of the Lunar New Year compared to the two weeks prior. This year, however, there was only a 38 percent increase, while in Chicago and Manhattan there was an actual decrease. Then, throughout the first three weeks of February, Chinese restaurants’ share of daily restaurant “connections” — things like phone calls, website clicks, delivery orders, and reviews — dropped about 20 percent.

Source: Yelp

The term “coronavirus” was mentioned in Yelp reviews for businesses in Chinatowns at 10 times the rate it was in reviews for businesses in other neighborhoods — many in comments from people encouraging others to patronize their local Chinatown, a sentiment echoed throughout the country. Politicians and celebrities also took to social media to convince people to visit their local Chinatowns, but data show continued declines in business throughout February.

Ironically, what seems to have re-stoked the appetite for Chinese food was the wave of social distancing that began moving across the country as people started avoided large gatherings and became dependent on takeout and delivery: Interest in Chinese cuisine skyrocketed, while interest in other, less-takeout-friendly cuisines like traditional American, Japanese, and Italian sank.

February into early March: People cancel their dinner plans

As March approached, several West Coast cities like San Francisco and Seattle saw a rising number of COVID-19 cases and deaths. According to location technology company Foursquare, visits to casual dining restaurants tracked by the service started falling, declining 8 to 12 percent around February 24.

Not surprisingly, full-service restaurant reservations saw a drop. According to reservation app OpenTable, reservations in Seattle were down 31 percent by March 3 compared to the previous year. San Francisco saw a 24 percent decline. In the following week, reservations continued to plummet, when Seattle and the Bay Area city saw a 49 percent and 43 percent decline, respectively. At that point, every city with 50 or more restaurants using OpenTable saw reservation declines as people increasingly stayed home. By March 8, several states, including Washington, California, and Florida — where some of the first novel coronavirus deaths occurred — had declared a state of emergency.

As some people likely pivoted to drive-thru or pickup options, the company found that visits to fast-food restaurants actually increased between February 19 and the week of March 13.

Source: OpenTable

On March 11, Resy, a reservations booking platform, sent an email to restaurant clients warning them to “anticipate significant cover and revenue declines in April and May.” The email explained that at the start of the month, Seattle reservations were a third lower than normal. Cancellations in the city spiked past 13 percent, similar to levels seen during Seattle’s record-breaking blizzards in 2019. In New York City, March cancellations were 45 percent higher than last year. 

”Immediately, restaurants should consider aggressive over-booking to combat the anticipated spike in cancellations and decline in walk-ins,” the email said, days before cities around the country would begin shutting down restaurant dining rooms.

Early March: Americans choose grocery over takeout

In the second week of March, the World Health Organization officially classified COVID-19 as a pandemic, and the United States closed its borders to most of Europe. As pleas for people to self-quarantine and practice “social distancing” filled screens, many Americans stopped going to restaurants entirely and prepared to stay home and cook for themselves. That week, Apptopia, an analytics company that tracks daily downloads of mobile apps, saw huge boosts in grocery delivery app downloads.

Downloads for grocery delivery app Instacart increased 215 percent between February 14 and March 15. In the weekend following coronvirus’s designation as a pandemic, Instacart downloads spiked 50 percent, Apptopia data shows, while downloads for Walmart’s grocery app increased 45 percent. (The big-box brand recently announced it would be slowly retiring the stand-alone grocery app and merging it with its general app.)

Source: Apptopia

As cities prepared to enforce social distancing, people rushed to grocery stores to stock up. Visits to bulk-buy grocery stores like Sam’s Club and Costco were up nearly 39 percent in New York City, Seattle, San Francisco, and Los Angeles from the week of February 19 to the week of March 13, Foursquare data shows. Yelp also saw a 160 percent increase in interest for grocery stores from March 8 to March 18 — among other spikes in interests for produce and takeout — over dine-in services.

Faced with cooking for themselves for an extended period of time, people have turned to tech to figure out how to lengthen the shelf life of all the food they bought. Google Trends shows that searches for “Can you freeze” spiked after March 12, with “can you freeze tofu,” “can you freeze half and half,” and “can you freeze tortillas” breaking out as searches in the food and drinks category.

Mid-March: Restaurants ordered to close

With the number of COVID-19 cases in the U.S. reaching 2,000 by mid-March, many state and city officials announced executive orders to shut down all onsite-dining at restaurants and bars. During that time, Yelp saw a sizable interest shift from dine-in options to delivery and takeout. By March 18, daily restaurant connections were down 54 percent overall; pizzerias, however, saw a 44 percent increase.

The forced closure of dining rooms means that restaurant businesses and their staffs will take a hard hit in the months to come. The effects can be seen immediately, however: As many restaurants closed, if temporarily, workers lost hours or were laid off altogether. According to Homebase, a free scheduling and time tracking tool for small businesses, the total number of hours worked for local businesses in the food and drink sector had dropped 40 percent by March 17, while the number of hourly workers overall declined 45 percent. 

Revenue data from customer management software company Womply, which tracks revenue from 48,000 restaurants, shows restaurant revenue significantly lower than last year’s numbers. As early as March 15, the day that Mayor Bill De Blasio and Governor Andrew Cuomo announced a capacity reduction for New York City restaurants, revenue was already down 25 percent.

Source: Womply

It remains to be seen how the restaurant industry will recover from the COVID-19 pandemic. For the restaurant industry — particularly small, non-chain restaurants — to truly survive the crisis, something drastic will need to be done. A number of fundraising campaigns and nonprofit-driven grassroots efforts may ameliorate or defer some of the losses restaurant owners and workers are facing, but short of a massive, government-backed bailout, in the form of rent abatements, tax deferrals, disaster relief loans, and other kinds of relief, it’s hard to say what the restaurant industry will look like when we finally emerge from our houses in the coming weeks and months.

Vince Dixon is Eater’s senior data visualization reporter.