MINNEAPOLIS (WCCO) — From manufacturing plants to neighborhood cafe’s and movie theaters — the bottom line at some Minnesota businesses has been hit hard by COVID-19.
WCCO-TV took a look at the numbers from the past few months and talked to a professor about what the local economy will look like moving forward.
The list only seems to get longer each week, more than two dozen restaurants in the Twin Cities have now closed their doors permanently due to the COVID-19 pandemic.
From Bachelor Farmer to all Bonfire locations, the health crisis has cost local eateries the most in profits.
An Economics Professor at the University of Minnesota, V.V. Chari expects, even more, will do the same with this slow re-opening.
“It’s very difficult to see how a huge fraction of the restaurant industry can continue to survive,” Chari said.
He believes only dramatic business remodels at restaurants and raising prices will help.
“If you’re going to be at 50% capacity you better raise prices twice as much if you’re going to make a living out of it,” he said.
Professor Chari says Minnesota salons and travel and leisure will also suffer.
“There are certain kinds of economic activity that requires fairly close physical contact. Those are most likely to spread infectious diseases. Those are the kinds of activities that have taken the biggest hit,” Chari said.
Minnesota’s Department of Employment and Economic Development tracks closings and layoffs monthly. In April alone, more than 5,000 Minnesotans fell into that category, 1,600 people in May.
Perhaps the most staggering statistic since mid-March is that nearly 800,000 Minnesotans have applied for unemployment benefits.
“This was the steepest economic decline on record. It’s also in some ways the sharpest recovery on record,” Chari said.
But, he believes caution is key, as COVID-19 cases spike in states across the country. He’ll wait to see if the same thing happens here.