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Extra space, flexibility, luck: For restaurants that survived the pandemic, it could take all three

Pre-pandemic, 10% of Connecticut's workforce was in restaurants. Since COVID-19 at least 600 of the state’s restaurants have closed and tens of thousands remain unemployed. For those still open, the road ahead is still uncertain. In our “Roads to Recovery” series, part of “Chasing the Dream: Poverty and Opportunity in America,” Christopher Booker visits three restaurants with very different stories.

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  • Hari Sreenivasan:

    Continuing our Roads to Recovery series, we turn to food and jobs. President Joe Biden's COVID-19 relief plan includes $28.6 billion in grants to restaurants, an industry hit hard by extended coronavirus shutdowns.

    Before the pandemic, ten percent of Connecticut's workforce was tied to the restaurant industry. But in the last year hundreds of restaurants have closed and tens of thousands remain unemployed. And even with relief on the way, the road ahead for those who have managed to hold on is still uncertain.

    Christopher booker visits three Fairfield county restaurants with three very different stories. This story is part of our ongoing series, Chasing the Dream: Poverty and Opportunity in America.

  • Christopher Booker:

    When this is all said and done – John Nealon and his business partner slash wife, Morgan Nealon, could well be a case study in how a restaurant—and a marriage—survives a pandemic. Maybe.

  • John Nealon:

    It's been crazy, man. We had a baby in March, the restaurants went into full, you know, shut down, take out only about a week and a half later.

  • Christopher Booker:

    In March when the shutdowns arrived the Nealon's business was just five months old. They were forced to furlough much of their staff and quickly move Taco Daddy from a place where people gathered for food and drinks to a takeout restaurant. It didn't work very well.

  • John Nealon:

    It was bad for us.

  • Christopher Booker:

    Takeout was?

  • John Nealon:

    Horrible, horrible.

  • Christopher Booker:

    But a year later, Taco Daddy is still standing — through a combination of government support, luck and ingenuity. The paycheck protection program, PPP, which was part of the bailout bill passed in May of last year, provided the young restaurant a $225,000 lifeline.

  • John Nealon:

    The first PPP saved everybody. Yeah. Including us.

  • Morgan Nealon:

    We opened this with our literal last dime. So it was like we had no extra capital to push back into this if we didn't get that.

  • Christopher Booker:

    But they did have a large space and a flexible landlord. With a relief on rent and the PPP loan, the Nealons were able to transform their 5,500 square foot dining area, giving Taco Daddy an enviable amount of social distance wiggle room.

  • John Nealon:

    We're lucky we have 5,500 that we can spread tables out and then we got the dividers going into the fall, but you know, a lot of restaurants when you think about it, what is 50% capacity when you're a thousand square feet? right. There's four tables, like two tables. And what do you got?

  • Christopher Booker:

    While Taco Daddy is still standing, many restaurants in CT and around the country are not. Scott Dolsch is the Executive Director of the Connecticut Restaurant Association. He says at least 600 restaurants have closed in Connecticut, and tens of thousands remain unemployed.

  • Scott Dolch:

    We had 160,000 employees pre-COVID, ten percent of our state's workforce. We know about 85,000 of those plus went on unemployment in those first two weeks — it was a dark time and we've been working so hard to get them back. I think, think we got up to about one hundred and twenty-five, and twenty-seven, in the height of September of outdoor dining. But then we saw another dip.

  • Christopher Booker:

    Like other places, through the summer Connecticut state and local officials allowed for the expansion of outdoor dining, giving many restaurants, particularly those in downtown locations, much-needed social distance space, but then of course the winter came. According to Connecticut's Department of Labor, between October and December, Connecticut lost 6,700 jobs in leisure and hospitality. Putting total employment 20% below where it was one year earlier.

  • Scott Dolch:

    These winter months have been some of the toughest times for them. Our industry works off of very thin margins. The national average for a restaurant is a four to six percent profit margin. So when you're down 30, 40 percent for an extended period of time, like that's bleeding money out.

  • Christopher Booker:

    But some Connecticut restaurants didn't even get an "outdoor" bump.

  • Corey Falcone:

    For us because we're not downtown. We're on the outskirts of town. It's a little different.

  • Christopher Booker:

    Corey Falcone runs Sunny and Frankie's on the edge of Stamford with his wife and brother-in-law. On the very day that we visited they had just gotten their first PPP loan, almost a year into the crisis. For Falcone, this influx of cash will hopefully be enough to get them to the finish line, which he says will only happen when he sees people crowded around his bar.

  • Corey Falcone:

    It's all about getting people back to the restaurants and drinking and I don't mean drinking to excess. I mean just drinking, congregating, watching games, talking to each other. That's what it's all about, but until they do that, it's still going to be difficult.

  • Christopher Booker:

    There are indications that this might not be far off. At Columbus Park Trattoria in downtown Stamford- owner and manager Michael Marchetti is seeing a return of some familiar faces.

  • Michael Marchetti:

    I'm seeing customers that have gotten their second vaccine and they're coming out and they're coming out in droves.

  • Christopher Booker:

    That must feel like an even more than a glimmer of hope when you're seeing now the vaccine.

  • Michael Marchetti:

    Not just for me, but for my staff, you know. They get discouraged. I've cut hours, I've cut so many hours, I don't know how how much more I could cut and the staff has been wonderful and understanding that they know this is not this is not me trying to be cheap, but it's it's about survival.

  • Christopher Booker:

    But despite the return of some of his regulars, there are indications the economic damage from the pandemic and the trickle-down impact on Marchetti's restaurant, might be permanent.

  • Christopher Booker:

    Work has changed, people are working from home more and more. And obviously there's a lot of white collar jobs here. Do you anticipate those corporate customers will come back, or, don't know?

  • Michael Marchetti:

    They have to come back, please? I mean, we've had PPP twice. All things equal, we're just covering our expenses. Barely, barely.

  • Christopher Booker:

    But just down the road at Taco Daddy, even without the promise of corporate offices filing back up, hope seems spring eternal. John and Morgan Nealon have opted to open a 2nd restaurant right next door to Taco Daddy. Opened in September, the Lila Rose Cocktails and Tapas Bar has both indoor and outdoor space and COVID-specific protections in the lease. If there's a restriction on indoor seating, they don't have to pay the full rent.

  • John Nealon:

    We're in this business to be creative. We're in this business, like keep doing something to keep pushing and figuring out what we're capable of and what people like and we never stop doing that. I'm not trying to sound like a hero here or anything like that. But it's it really was just like, keep doing what you're good at, stay focused.

  • Morgan Nealon:

    Like eventually, this thing has got to wrap up. And then where you like what you've done during this time is either going to put you ahead or leave you dead in the water.

  • Christopher Booker:

    The Nealon's may find out if their gamble pays off soon. Connecticut's governor recently announced that restaurants would be able to return to full capacity this coming Friday.

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