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How are restaurants and bars reacting to new restrictions?

Earlier last week Governor Walz signed an executive order that places new restrictions on restaurants and bars. The executive order limits the number of people allowed at social gatherings and forces bars and restaurants to close early. Additionally, capacity has been capped to 150 or 50% of fire code capacity; whichever one is lower.

Restaurants and bars have been heavily affected this year, and these new restrictions without a doubt will leave their own mark as well. As reported by the Star Tribune, restaurants are already taking measures to comply with the new rules. But some of these measures will hurt the economy. And businesses fear for the future of the hospitality industry

“I just suggested three of my bartenders take a leave and be on unemployment,” said Justin Sutherland, whose restaurant Handsome Hog in St. Paul features a 60-seat bar that must now stay vacant.

Dozens of restaurants and bars have closed permanently this year, with scores of employees furloughed or laid off. Many operators were already bracing for the winter, when patios can’t make up for indoor dining. For some of them, the new rules foreshadow more bad news to come.

“I will say we’re terrified,” said Rob Germinaro, general manager at Alary’s Bar in St. Paul. “It’s not just for me. It’s for my staff and for the industry as a whole. You’re going to see small single-ownership operations struggle and close forever.”

Hospitality Minnesota has already warned of potential massive closures due to new measures.

Hospitality Minnesota, a lobbying group, said half of the state’s hospitality businesses could permanently close in the coming months, even though only a “small fraction of cases” are coming from restaurants and bars.

“While we appreciate that the governor is not shutting down restaurants, bars and events as some other states are doing, we are concerned about the economic and jobs impact on these businesses,” Hospitality Minnesota President Liz Rammer said in a statement.

Robb Jones, co-owner of Meteor Bar in north Minneapolis, struggled Tuesday to process the news about the curfew. The bar is an industry favorite that draws staffers from restaurants stopping in after their shifts. More than a third of its business comes after 10 p.m.

“I think what we’re upset about is mostly the fact that we were doing everything the right way,” Jones said. “We’ve been doing this for months now and none of us has gotten sick.”

I have written before about just how destructive uncertainty over the shutdown has been for the economy. Restaurants and bars have faced plenty of uncertainty over this crisis. Not only have they faced a shutdown that was extended at every turning point, but they have also had to operate under restrictive capacity limits that some did not see coming. And additionally, they have had to spend money investing in heating appliances and techniques for winter.

These new restrictions and any additional ones will put a damper on many business plans. And the fact that business owners are resigned to the possibility of new and worse restrictions shows how uncertain they are about the future of the business environment. And this will prove detrimental to the hospitality industry in the long run.

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