WINSTON-SALEM, N.C. (WGHP) — Ask Claire Calvin what she thinks about running three restaurants in Winston-Salem and she quickly and enthusiastically will tell you: “I like it!”
But even she admits, this is a tough time to be a restaurateur.
“Last summer was such an up-and-down summer,” Calvin said. “So we had, you know, reopen with great fanfare, then we had a COVID outbreak, [and] close.”
The government did what it could to help, most notably what you hear referred to as “PPP.” That’s the Paycheck Protection Plan. The idea was to simply give companies money so they can keep their workers on the payroll, even with little or no money coming through the door, organically. Most people understood the aim, but:
“There have been a large number of unintended consequences,” said Algenon Cash, who also runs several restaurants and is heavily involved in the food and beverage industry in Winston-Salem. “Keep in mind that we’ve spent $6 trillion in COVID response in the last year. And, for your viewers who have had a tough time wrapping their head around $6 trillion, that’s more money than we’ve spent on every war since the Korean War. So, you can’t spend that in the last 12 to 15 months. You can’t spend that massive amount of money without getting some unintended responses.”
One of those unintended consequences was that the money kept some restaurants that would likely close even without a pandemic – over the last 30 years, roughly one in five restaurants closed in their first year of operation, data from the Bureau of Labor Statistics shows.
Calvin says she wanted to be very careful about how she used the money from the PPP program.
“There were people that I knew that brought their whole staff back, basically paid them to do nothing and then ran out of PPP money and, then, lo and behold, the virus was still here,” Calvin said. “In our company, made a decision, early on, to use the money – to try not to let the fact that there was available money make us make businesses decisions that we wouldn’t have, otherwise. And if we don’t use all the money, we don’t use all the money. If we have to give it back, we have to give it back.”
The other unintended consequence is that those restaurants that stay open, artificially, kept their workers from going to places that were more viable, creating a labor shortage.
“As (those restaurants that aren’t viable, long-term) get out of that game, that allows us to reallocate that labor and those workers from other restaurants that are more viable and have a real opportunity to get through this,” Cash said. “And I say that from a pure, economic perspective because, as a small business owner, I truly understand how difficult it is to make that decision that you just can’t keep going.”
Calvin figures the last 18 months have been a valuable learning experience.
“We just do what we’ve got to do to get through it,” she says.
See Calvin’s restaurant and more on how she survived in this Project 2021 report.