The Aruba Food & Beverage Association (AF&BA) recently conducted a survey among restaurants centering on convid-19 and how this affected the restaurant sector. Thirty-six (12%) restaurants responded to the survey.
The first question “Did you apply for wage subsidy *? 61.1% responded having applied for wage subsidy while 38.8% responded of not having applied. Conclusions may be drawn that restaurants may not have applied for the wage subsidy because of mixed feelings of being able to open and prefer the FASE subsidy **.
On the second question “How would you describe your business? 83.3% responded to be closed for business – ZERO SALES – 11. % responded to have 25% sales; and 5.56% responded to have 50% sales. From the above it may be concluded that the F&B sector received a tremendous blow due to Convid-19 and the corresponding lock down.
“Would you open with an outside terrace on May 25?”, was question number three and 36.1% responded to open with a terrace and 63.89% responded not to open with a terrace.
Question number 4, “How much of your staff you think you can retain 3 months from now? 61.1% responded to be able to retain 100% of the staff trough the month of July; 16.67% responded being able to retain staff for 75%; 11.1% responded being able to retain 50% of the staff and 11.1% responded to be able to retain 25% of the staff. The response reflects optimism possibly based on the recently received wage subsidy and the hope this subsidy will carry the sector through including the month of July 2020. Based on this question it is estimated, however, that 1000 employees will lose their job in the restaurant sector.
The fifth question “How much of your staff you think you can retain 6 months from now? 47.2% responded being able to retain 100% of their staff through the month of October; 25% responded being able to retain staff for 75%; 22.2% responded being able to retain 50% of the staff and 5.56% responded to be able to retain 25% of the staff. Three months later the restaurants that can retain their staff at 100% based on few tourists is reduced with 15% from 61.1% to 47.2%. This also implies that many restaurants will not be able to survive without the wage subsidy or any sort of financial aid.
“When do you think it would be safe and sustainable to open your restaurant” is question number 6 and 13.89% answers to be able to open the restaurant in June; 5.56% is thinking to open in July; 8.33% thinks of opening in August and 13.89% is thinking to open somewhere in September and 13.89% respond in 5 – 6 months; 27.7% thinks about opening when the Government authorizes restaurants to open while the majority 30.56% is not sure. Some analysis here may guide us to a projection of 200 restaurants that consider to open 6 months from now. An AHATA projection of 30% occupancy would justify 100 restaurants to be open which will force our sector in a regretful survival of the fittest with 200 restaurants opening.
On the last question “Do you consider closing your restaurant?” 8.33% respond to close their restaurant while 83.3% responds to remain operational while 8.33% is not sure yet. In general, great satisfaction was expressed on wage subsidy was administered by SVB and management of same by GOA.
AF&BA plans to conduct another survey next month with questions pertaining to the opening of terraces, the Aruba Health & Happiness Code and a repeat of some questions as operators reflect on the future re-opening of their restaurants.
Considering the many challenges ahead AF&BA recommends restaurant operators to reach consensus on shorter working hours and days with their staff now that hotel occupancies will proof very complex to sustain hotel occupancies 30 – 40% at 100% staff. Flexibilization of labor laws will be key for our restaurant sector to service according to AF&BA and urges the Government of Aruba (GOA) to start thinking in this direction. Questions to AF&BA can be sent to our aga@setarnet.aw email address.
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*The salary subsidy is financial support for local businesses that have been financially affected by the Covid-19 pandemic in the form of revenue loss of more than 25%. The main objective of this support is to keep as many people employed as possible despite partial or complete loss of economic activity and to guarantee payments of partial salaries.
**FASE is a compensation from the Emergency Social Assistance Funds FASE to help cover the loss of income of employees due to the reduction of working hours, causing them to earn less than AWG. 950, 00 ($ 543) monthly.
