Restaurant owner standing in his empty restaurant.

America’s Restaurants and Bars Are on the Brink

6 min read • Jan 16, 2021 • Grant Olsen

UPDATE: The PPP loan application period ended May 31, 2021. Learn about financing options available for small businesses today at

Some of our nation’s most dedicated and selfless workers are in the restaurant industry. They toil long hours in intense work settings to provide food and drink to customers who need TLC more than ever, thanks to the disruptive power of the ongoing pandemic. Impressively enough, restaurant workers often think of their communities even as their own financial situations become more dire. Across the country, they are stepping up to provide free meals to first responders and others in need.

“As the food service industry enters crisis mode during the coronavirus pandemic and restaurant traffic continues to dwindle while brands rely on delivery and takeout, community giving is on the rise,” note the industry experts from the Nation’s Restaurant News. “With creative solutions that can help struggling restaurants pivot to a new aid-focused business model (like becoming a community kitchen or temporary grocery delivery service) or by simply donating extra food and resources to those in need, restaurants are on the front lines of the ‘good news’ coming out of this pandemic panic.”

These accounts of community giving are heartwarming but also underscore the disturbing fact that many restaurants and bars are themselves on life support. Facing decreased revenue, supply chain disruption, and other negative factors, each day brings new challenges and the ability to remain open tomorrow becomes more tenuous.

The impact on restaurants and bars has actually been disproportionately brutal when compared to many other industries.

“Restaurants and bars have lost over 2.4 million jobs since the start of the pandemic—far more than any other industry,” shares the Independent Restaurant Coalition in a statement. “This is the greatest net loss of jobs for these businesses since April, when restrictions were at their tightest. Unemployment in leisure and hospitality is 157% higher than the national average.”

Clearly, the millions of restaurant and bar workers who have been providing essential service to their communities are themselves in dire need of a lifeline. The latest jobs report from the Bureau of Labor Statistics reveals that 372,000 individuals from the industry lost their jobs in December. This staggering total means that of the 498,000 jobs lost in the leisure and hospitality sector, about 75% were from restaurants and bars.


Restaurant owner in his empty restaurant looking out the window.

But help is on the way, courtesy of the $900 billion in coronavirus relief package recently passed by Congress. A second round of
Paycheck Protection Program (PPP) loans has been approved and will help our nation’s restaurants and bars receive support that has been lacking since the first round of funding petered out this past August.

If you are a first-time applicant for a PPP loan, you’ll get priority in the approval process. Businesses that received funds in the first round can also qualify as long as their revenue has decreased by 25% or more this year.

“We are pleased that more PPP funds have been made available for small business owners,” says Brock Blake, the CEO and cofounder of Lendio. “These funds, as we know, are a virtual lifeline and have preserved millions of jobs around the country. The Lendio team has been working to prepare and improve upon the technology that enabled us to facilitate over $8 billion in loan approvals in the first rounds of the PPP.”

Lendio has already opened a preliminary online application for PPP loans in order to make the process as streamlined as possible so business owners can connect with crucial funds faster and with less effort. As the SBA updates the rules and regulations for the program, the online application will continue to be updated as well.

If your restaurant or bar could benefit from a PPP loan, don’t delay. These funds go quickly, and the sooner you start the process, the sooner you can receive a crucial financial boost. The loan is forgivable as long as you follow the program rules and use a minimum of 60% of the funds on your payroll and the rest of the money only goes to eligible costs.

“The people who work in restaurants and bars are uniquely hurt by this pandemic and don’t deserve it,” says the Independent Restaurant Coalition. “Over 110,000 restaurants and bars—over 1 in 6 across the country—have been left with no choice but to permanently close since March, destroying an important ladder of economic opportunity for millions of people. Restaurants, bakeries, bars, and coffee shops employ more non-white managers and young people than any other industry. Immigrants, a million single mothers, and the formerly incarcerated rely on restaurants and bars for their livelihood. We cannot leave these communities jobless.”

One reason it’s so important to get started on your application early is so you’ll have adequate time to gather the proper documents and ensure you’ve met all the requirements. Any error on your part can delay—or even derail—your hopes for funding. 

Here are some of the details and documents you’ll likely need to gather for your application:

  • Your business Tax ID
  • The loan amount you’re requesting
  • Your employee count
  • Your tax filings from the past 2 quarters
  • Your tax filing from 2019
  • Your payroll documents for the past 12 months
  • Your monthly bank statements from the past year

While the PPP loan option is undeniably special, it’s certainly not the only funding opportunity for your business. You might also want to consider other financing as a way to bolster your working capital, make updates to your property, purchase equipment, and handle your other obligations. Popular loans for restaurants and bars include:

  1. SBA 7(a) Loans
  2. SBA Express Loans
  3. SBA 504 Loans
  4. Term loans
  5. Short term loans
  6. Equipment financing
  7. Lines of credit

Whatever route you decide to take, rest assured that there are resources available to you. This pandemic has had a monstrous effect on your industry and you deserve support. If you qualify for a PPP loan, you will receive enough money for 2.5 months of payroll. That could provide a major lift for your people and help your business get on a more stable path for the rest of the year.


Grant Olsen

Grant Olsen is a writer specializing in small business loans, leadership skills, and growth strategies. He is a contributing writer for KSL 5 TV, where his articles have generated more than 6 million page views, and has been featured on and Grant is also the author of the book "Rhino Trouble." He has a B.A. in English from Brigham Young University.