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Sectoral Unemployment: Accommodation And Food Services

Updated : August 4th, 2020

unemployment accommodation food services

The latest report from the Department of Labor for the week from March 21-28 is just in. The unemployment claim numbers are at an all-time high for the second week running at 6,648,000 seasonally adjusted initial claims. The labor department reports that most states attribute these numbers to layoffs led by the accommodation and food services sector.

In this post, we take a sectoral overview of accommodation and food services as an employer and see the unemployment scenario from its perspective. The coronavirus-induced economic slowdown has made the futures of thousands of chefs, bartenders, wait staff, baristas, etc. uncertain. Now, all these employees have been made eligible for Unemployment Insurance claims.

Profile Of Accommodation And Food Services Sector

According to the Bureau of Labor Statistics, this sector employed 14 million people in 2018. It showed an average unemployment rate of 5.4% over the last 4 months.

 The top occupations in this sector are waiting or food service, food preparation, and cashiers. The largest number of employees are wait staff, followed by cooks. Employees earn an average hourly wage of $15.87. Many are employed and paid on an hourly basis in this sector.

The working hours’ number a minimum of 25 on average. Cooks may work much longer hours in a week.

COVID-19 Causes Unemployment in Accommodation And Food Services

This sector has reported the highest number of layoffs in the following states:

  • Texas
  • Michigan
  • Illinois
  • New York
  • Indiana
  • Wisconsin 
  • Virginia
  • Iowa
  • Missouri
  • Tennessee
  • Rhode Island
  • Maine
  • Alabama
  • Georgia

The reason for this is the lockdown of hotels, restaurants, pubs, bars, etc. by the US government in light of these places being potential clusters. As this sector depends on very regular cash flow, it doesn’t have the nest egg that bigger conglomerates can gather. The impact of dropping sales is seen very quickly.

In turn, employment in related businesses such as hotel aggregators like Booking.com gets affected. Such businesses survive on commissions from their third party services between customers and providers of accommodation and food services.

The sector’s nature makes remote work impossible, forcing layoffs and furloughs. Americans are clearly following social distancing norms well.

Types Of Jobs Still Available

As you can see in our post on jobs that are still hiring, dining out took a huge hit, but meal delivery services survive and some are thriving. Pizza chains, take-out meal joints, etc. have scaled up hiring to deal with larger order volumes. A few restaurants have switched to offering delivered and take out meals and are thus surviving with the staff getting reduced wages.

The most common job roles will be in food preparation, delivery services, and stocking/inventory work. It will be very difficult to find more specialized and high paying job roles at this point in time.

Projections For The Future

If the coronavirus-triggered shutdowns continue for too long, worldwide recovery for this sector will be difficult. The growth of accommodation and food services as an employment generating sector was fueled in recent years by the general economic growth and the resulting rise in disposable incomes.

With many big employers having global supply chains, the worldwide economic shutdowns in response to coronavirus will cause losses everywhere. Another big driver of the growth of accommodation and food services is tourism which will surely fall due to job losses.

 

The American Hotel and Lodging Association says that the hotel sub-sector alone has had losses of over $5 billion. Making up the amounts to retroactively pay employees still on rolls when the economy revives, will be hard without a quick revival of global trade and supply chains. 

The restaurant industry was facing labor charge pressures, spiraling rent costs and criticism about food wastage even before the pandemic. This is a good opportunity for corrective actions that go beyond merely restarting production and service.

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  1. I had trouble getting my proof of self-employment to upload in secure file exchange and finally got it submitted by 12:06 am , 6 minutes late. What are the possibilities that they will deny it? I have received unemployment from March 2020 to some of Jan and some in Feb 2021. Most of Dec, Jan, Feb, March, & april were stopped for this proof of employment.
    Also, I see proof of Income as a 2nd issue but it is always on there. That was not on my TO DO list.
    I feel for u all on ID.ME…

    Anyone trying to reach UI, call their number, press 2 or 3 (questions abt filing a claim?) and then wait thru the message. At the end of it, u will be connected to a live person! I promise.. don’t push another button.. I’ve done it 4 times and it never failed.

    We lost our home, my ex took my child…. (kept her after a visit and called cps facilitating drama while the cops wouldn’t give her back without paperwork locked up in the court house..shut down for covid) I raised her by myself for 12 years & now she is with a violent alcoholic and parental alienating parent .. ….my dog, my 9-year sweet little best friend, was attacked, passing away 3 days later.. all in this time frame.
    But! It will all be ok. I have faith.

    Be grateful for your life and all that is in it today. What u dwell on daily will be your strength or weakness.
    Good luck to all of u.
    And thank you, Jeff, for responding out here. It is appreciated!
    Davulia S.

  2. I filed over two months ago. I have not received any information. My status says “pending resolution”. I have no way of contacting anyone. My position was eliminated at my job and I submitted the documentations online. I dont know what else I can do.

  3. I have been apply Ohio Pua unemployment since July 5th still pending issues. Upload what they ask for when ever I call says your case is in Adjudication. Very very frustrated, financially I am broke. Health issues. Waiting a long period.Don’t know what I will do ?

    1. Nafisa,

      I can understand your situation. There will be a delay considering the number of applications that are being processed. Please continue chasing the office/check your status online at regular intervals until payments normalize.

    2. Same here since Feb 2021 turned in all the documents still pending issues 3 months now. When you call they tell you to be patient. Pulling my hair out it’s so frustrating.

  4. I was receiving PUA unemployment. they made me file for a new claim in February. Now I am in adjudication even though I gave all the same information from my previous claim. Have been adjudication since February and I call and they say they will put in a ticket to have an Adjudicator call me. Nothing. I am wondering If I can go down to to Maryland Unemployment Office and demand that someone talk with me to release my claim for payment. It’s been 56 days. I read that they have a maximum of 45 days.

    1. Luis,

      Your adjudicator may be inundated with pending cases. Please continue to follow up (if you have the contact details) or consider the option of visiting an office in the vicinity if safe and feasible.

    2. t sounds just like mine only im disqualified yet actie every till sept 4th . they haven’t asked me for anything! i file then its disqualified yet im told im ok and have nothing to do bit wait for an answer? answer to what? they switched my program and all and asked me to provide proof for a claim that wa denied al eady back in 2018! deny me once and then again perhaps? lol idk

  5. My mom had unemployment in Florida. She just recently moved temporally to California with a sister since she needs assistance, and now the website is telling her she cannot do anything because she is register in another state. Can she keep filing unemployment in Florida, even if she is living and register now in another state? how is the process to change the unemployment? I tried calling and there is no answer. Thank you!

    1. Stephanie,

      Please ask your mother to consider transferring the UI benefits from FL to CA (details will be available on either of the websites). If there are benefits weeks left in the account, she will be able to claim them.

    1. Leatha,

      UI benefits are offered to claimants who lose employment involuntarily and be able to and available for work.

  6. I lived in ga in 2019 and move to florida in 2020 and work for the xmas months in nov-dec. I was told to do a combine wage claim. my question is which state do i file the claim in?

  7. I filed for pua in Ohio back in October 2020.My claim has been in ajudacatuon since 11/1/20.So 2 to 6 weeks is a total understatement! When I call.i am told to basically hurry up and wait some more.I have recently been redetermined and my claim is allowed.but I have one pending issue.How long is too long?

    1. Nicole,

      Unfortunately, nobody has an answer. There are perhaps thousands of pending applications. Please consider the option of visiting an office in the vicinity if safe and feasible.

  8. If you claim your weeks for unemployment and for the next 2 months you still have not received your money. Where can you go in volusia county to talk with a live person

      1. HI Jeff,
        I applied back in Dec 5th, 2020 and I haven’t received any correspondence, is there a local office that I can make an appt to make certain my claim is right.

        1. Adam,

          You can consider visiting an office in the vicinity if safe and feasible (details will be available on the Unemployment Office’s website).

  9. On NYS DOL website, my claim is saying current yet the information is for my old claim with 0 days remaining despite receiving 2 weeks of payments on the new claim and I was able to certify last night. I haven’t received anything; no letters or emails.

  10. I was disqualified for UI benefits for not providing an ID and other forms of identification. How do I fix this?

        1. Gary,

          You may not be eligible since unemployment insurance is only extended to those who become unemployed due to involuntary reasons.

    1. Hi Mike, I’m in NYS and was at the end of my BYE on 3/14, I was still certifying but wasn’t getting paid. I found out I had to file a new claim because my other was exhausted. I’m still waiting on approval. Maybe you have to file a new claim. I hope this helps.

  11. They say 2-6 weeks it’s more accurate to say 2-6 months; and when you call many of them are rude and unwilling to assist!

  12. someone needs to look into Sharon L. Anton gillette, wyo. or dickinson, nd she is a fraud and has done so many fraudulent things and please look into her

    1. Annette,

      Please report it to the Fraud Division of the Unemployment Office in your state. You can report on the website.

  13. I worked part time for thee years here in florida. I’m currently not working. I’m also retired and collects social security.
    My question is
    Am I qualified to file for unemployment ?

    1. Ruby,

      To be eligible, you’re required to have sufficient hours and earnings. Please use the “Benefits Calculator” available on this website.

  14. So adjudication takes 8 to 12 weeks. Oh okay, that explains why I havent received payment since July. That surely helps just like the rest of the information that you give. And by the way. What’s the NEW reason you can’t get through to the Call Center.

    1. Maria,
      I have gotten through to the call center (live agent) every time i’ve tried calling within the last 2 weeks. The number to a live agent (follow the prompts carefully) is (667)-207-6520. i have gotten through within 10 to 15 mins with each call i had made!

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