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Restaurant Jobs Took Another Hit in January as U.S. Economy Inched Forward

The industry shed another 19,400 jobs in the first month of the year

A black and white photo of an empty restaurant, with several tables-of-four Gary He/Eater

January was yet another month that told a familiar story for folks working in hospitality: The larger economy gained jobs while the struggling restaurant industry did the opposite. More specifically, as U.S. employers added a paltry 49,000 people to their payrolls, COVID-19-ravaged bars and restaurants lost 19,400 jobs, the Bureau of Labor Statistics reported, a small and perhaps even encouraging decline compared to last month’s drop of over 400,000,

Still, it was the third straight month of job losses for restaurants. Just 9.94 million people now work in the restaurant industry, down 2.37 million from last February’s pre-pandemic levels.

Dining restrictions around the country have begun to ease, notably in California, Illinois, Philadelphia, the District of Columbia, and elsewhere, but it’s likely that any resulting employment gains didn’t occur in time for the January jobs report. New York Gov. Andrew Cuomo announced last week that indoor dining would return to the five boroughs on Valentine’s Day at 25 percent capacity as a variety of public health indicators, including hospitalizations and virus cases, fell throughout the city.

Safety concerns over the emergence of faster spreading COVID-19 variants notwithstanding, local owners and operators will likely see today’s numbers as a charge to push Cuomo to more quickly allow indoor dining to 50 percent capacity, the level it’s permitted at throughout the rest of the state. The labor department will release New York City-specific employment numbers for the hospitality industry later this month.

U.S. bar and restaurant unemployment was 14.4 percent in January, over double the full U.S. unemployment rate, which fell to 6.3 percent. Interestingly, the jobless number for bars and restaurants constituted an improvement from December’s rate of 16.1 percent, despite the fact that the industry lost nearly 20,000 jobs. It’s possible that technical factors accounted for that drop in unemployment. Folks who aren’t actively looking for work during the last four weeks — perhaps because they’re staying at home to protect their health or because they’re discouraged by the lack of job openings — aren’t counted as unemployed.

The picture for the larger economy wasn’t quite rosy either, as gains in business and professional services were offset by losses in retail trade, transportation, warehousing, and the greater hospitality industry. A particularly harrowing revelation was that the number of people unemployed for over half a year rose by 67,000 to just over 4 million, the highest that number has been since the pandemic began, and over three times higher than last January’s number of 1.2 million.

As always, gains and losses were not equal among different groups. Unemployment among white people dropped 0.3 percent to 5.7 percent, but men almost exclusively accounted for those gains; white women lost 132,000 jobs. Just the same, the Latinx population, who make up a significant portion of the hospitality industry, saw their jobless rate drop 0.7 percent to 8.6 percent. Still, Latinx men gained 116,000 jobs, while women lost 77,000 jobs.

Both black women and men gained jobs, but their overall unemployment rate remained the highest of any adult group at 9.2 percent, down from 9.9 percent in December.

The unemployment rate for Asian people increased, from 5.9 percent to 6.6 percent, with that group having lost about 14,000 jobs.

What’s particularly troubling about these demographic numbers is how they show a wider unemployment gap between white people, who have recovered jobs more quickly, and other groups, who have not. Last January, before the pandemic, the jobless rate for Asian folks was just 0.1 percent above that same rate for white people. Now, the difference is almost a full percentage point. And while the unemployment gap between white people and Latinx people was just 1.3 percent at this time last year, that figure has more than doubled to 2.9 percent.

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