The pandemic has not dashed Americans’ entrepreneurial spirit for restaurants, according to Yelp data.
“Opening a restaurant is no easy feat under normal economic circumstances, yet it’s happening during the pandemic at a higher rate than one might expect,” the company stated in a report released Thursday.
The review site found that in September, the number of restaurants and food businesses that opened in 2020 was nearly as high as those created in 2019, 6,497 versus 6,624, respectively, despite the extremely different circumstances. September 2019 saw a 3.5% unemployment rate, which more than doubled to 7.9% last month. Real gross domestic product grew a strong 3.5% in the second quarter of 2019. Meanwhile, the economy contracted at a record-breaking 31.4% annual rate in the second quarter this year.
Making matters worse for these up-start eateries is that retail sales for this sector last month were more than 14% lower when compared to September 2019, according to the Census Bureau.
What’s more, these openings come as many restaurants, some of which had been opened for decades, were permanently shuttered due to the economic shutdowns caused by the pandemic.
Yelp reported in September that “restaurants remain hardest hit” by the pandemic. It noted that 32,109 restaurants had closed between March and the end of August, with 60% of the closures permanent.
Despite these closures, Yelp’s report from Thursday showed that new restaurant and food business openings have steadily increased since April, with over 23,000 of them occurring since the virus took hold of the economy.
In fact, in July, openings in 2020 eclipsed those that occurred for the same month in 2016 and 2017. Last July saw more than 6,700 new restaurants and food businesses open. Roughly 6,000 opened in July of 2017 and approximately 5,500 did for the same month in 2016.
In August 2020, openings beat those that occurred for the same month in 2018, 6,735 openings versus 6,585 starts, respectively.
Yelp’s data on openings is based on the new restaurants and food businesses listed on its website.
