New Orleans

The coronavirus pandemic is the all-time greatest uncertainty the restaurant industry has ever faced, a high profile New Orleans restaurant official said Friday.

While the pandemic has hurt a wide range of industries, including retail, hotels and oil and gas, it has hit restaurants the hardest, said Melvin Rodrigue, president/CEO of Galatoire’s Restaurant in New Orleans and chair of the National Restaurant Association. At one point in the spring, Rodrigue said 7 million of the 15.1 million people who work in the restaurant industry nationwide were unemployed.

The panel, sponsored by Hancock Whitney, AARP Louisiana, Acadian Ambulance and LCMC Healthwas an hour-long discussion with guests representing key sectors of the state’s economy.

The Advocate hosted an economic outlook summit on Friday morning, focusing on the state of the Louisiana economy and how coronavirus has impacted it.

The panel, sponsored by Hancock Whitney, AARP Louisiana, Acadian Ambulance and LCMC Health was an hour-long discussion with guests representing key sectors of the state’s economy.

Here's a quick look at five big topics that were discussed:

Louisiana is in the midst of a very challenging point in time, but we’ve been here before.

The state has had to navigate difficult lanes in recent years: hurricanes Katrina and Rita and the 2016 floods, so we’ve been here before, said Don Pierson, secretary of Louisiana Economic Development.

Oil and gas and the hospitality industry have been hard hit by the pandemic, but Pierson said the state has seen rough times in the energy industry and always rebounded.

The key is for the state not to lose sight of its strengths, which have not been harmed by the coronavirus pandemic —  sectors such as agriculture, timber and health care, he said. Continued diversification of the Louisiana economy is also important, growing promising sectors such as IT, advanced manufacturing and coastal protection.

“We’re struggling in certain sectors, but we have not run aground,” he said.

The future of the state’s oil and gas industry depends on how the economic recovery plays out through early 2021.

The energy industry was already weak going into 2020, said David Dismukes, executive director of the LSU Center for Energy Studies. That was before the pandemic reduced demand worldwide as travel dropped off sharply.

Oil production worldwide is down by about 15% and natural gas by 8%. The natural gas numbers are a bit better in Louisiana, and relatively flat, because of the easy access to deposits in the Haynesville Shale in northwest Louisiana and the Gulf of Mexico, he said.

But Dismukes said the number of rigs drilling in the gulf are near an all-time low. “You have to get back to the 1990s to see these kinds of numbers,” he said. “They’re below where they were in 2008 and 2009.”

After a promising start, the driving season tapered off and the summer will probably end with gasoline usage being below early expectations.

There are concerns rising numbers of coronavirus cases in states such as Arizona, Florida, Texas and Louisiana, which hampered summer travel, will cause lawmakers to retrench on efforts to reopen the economy.

Along with hoping case numbers start to get better, Dismukes said another factor that could help oil and gas is for Congress to pass another stimulus bill. “Anything to buoy up demand,” he said.

The chemical industry has not seen a lot of layoffs, but projects that were supposed to start construction this year have been pushed back.

Industrial manufacturing has fallen by 10% to 15%, said Greg Bowser, president of the Louisiana Chemical Association, which represents more than 60 chemical manufacturing companies.

“I think things have flattened out and we hope to start building back, once demand gets rolling,” he said.

Bowser said he expects to see growth in the industry start to happen in the first or second quarter of 2021.

But the fear is that any sort of major outbreak would cause a setback. Bowser said another extended lockdown to control the spread of the coronavirus would be “devastating” for the chemical industry.

The pandemic is the greatest uncertainty the restaurant industry has ever faced.

The coronavirus pandemic has hit the restaurant industry the hardest, said Melvin Rodrigue, chair of the National Restaurant Association and president/CEO of Galatoire’s Restaurant in New Orleans. At one point in the spring, Rodrigue said 7 million of the 15.1 million people who work in the restaurant industry nationwide were unemployed.

“Our whole purpose is to have people in dining spaces, having social interactions,” he said.

There are fears that the pandemic could put 4 out of every 10 restaurants in the U.S. out of business.

The key for the restaurant industry is consumer confidence, Rodrigue said. That means diners feeling confident enough about their income that they want to go out and have a meal, and feeling confident it’s safe eating and drinking inside a restaurant.

“Without the return of visitors, New Orleans cannot sustain its current number of restaurants,” he said.

Expanded federal unemployment benefits didn’t really hamper the ability for most businesses to bring people back to work.

The additional $600 a week unemployed people were getting as part of the coronavirus relief passed by Congress didn’t have much of an impact on employment in the energy and petrochemical industries. Both of those sectors have good-paying jobs, so people who were able to get back to work were willing to forgo the extra money, Bowser and Dismukes said.

The extra pay had an impact on the restaurant industry, Rodrigue said, and some workers were willing to continue to stay at home either to get the expanded benefits or out of fear of the pandemic.

“But in the next breath, I don’t think the benefit should go away completely,” he said. The extra money helped restaurants in that people had enough money to buy meals. And the maximum state unemployment benefit of $247 a week in Louisiana isn’t enough.

Rodrigue said Congress needs to restore the extra federal benefits “somewhere in the middle.”


Email Timothy Boone at tboone@theadvocate.com.