The Latest On How Industries Affected the Most Have Recovered During Coronavirus

By Jemima McEvoy Monday, August 31, 2020

The coronavirus pandemic has completely reshaped America’s economy. Bar a handful of industries that have thrived through the public health crisis, almost every company in every sector of the US economy has felt the blow of months of stay-at-home orders and mass unemployment.

These unprecedented challenges have significantly impacted several core industries that depend on travel and social contact. Here’s how those most affected have gotten creative and weathered the storm.

Airlines

The airline industry was among the first to be impacted by COVID-19. Once the virus was first detected in the US, airplanes across the globe were told to turn off their jets, with international — and even domestic — travel blocked to stop contagion. According to Barrons, losses for the industry are predicted to reach $84 billion, with airlines posting 50% sales plunges.

Despite the sizable challenges, airlines have managed to fight through the tough months with government bailouts and private financing. The federal Coronavirus Aid, Relief, and Economic Security (CARES) Act doled out $50 billion worth of payroll grants and loans that halted devastating layoffs and the near-collapse of America’s airline industry.

However, consumer confidence in air travel has been knocked, forcing airlines to think outside the box to tempt back customers. One strategy was slashing prices — you may have noticed the $20 flights to Rome — to drum up momentum for travel.

That being said, many are still hesitant to get on a plane unless they have to, so the best course of action has been carefully crafting safe coronavirus-era flight policies, including mask mandates and regular cleanings, that put customers at ease. For example, Delta Airlines issued a no-tolerance policy, which means that they will ban anyone who refuses to wear a mask on their aircraft from flying with Delta again.

Restaurants and Bars

Restaurants and bars haven’t fared much better. As states across the country began instituting stay-at-home orders, eateries had no choice but to close their doors — with many still waiting for the green light to reopen six months later. The industry has lost over $120 billion in sales due to the pandemic, with many small businesses forced to shutter for good. On top of that, millions have been temporarily furloughed or laid off from their food service industry jobs.

While the Paycheck Protection Program (PPP) loans have served as a lifeline for struggling establishments, government aid is not enough in many instances. Restaurants and bars have had to come up with alternative sources of revenue. Many shifted their business models to ramp up take-out or food delivery services. Others turned to crowdsourced community support, setting up GoFundMe pages to ask for donations, which would quickly stream in for neighborhood staples.

New York City serves as a great example of how municipalities facilitated and embraced the creativity of restaurants and bars to help them survive COVID-19. New York — in a model that also emerged in other cities — shut down dozens of roads so that restaurants could offer outdoor dining. Parking spaces, sidewalks, and streets became charming outdoor eateries as part of an initiative that was so successful, New York City Mayor Bill de Blasio announced its return next year (even if the virus is gone).

Tourism

A recent report from the United Nations illustrates the devastating toll of coronavirus on the tourism industry. No travel and shuttered museums, galleries, and shops has put 120 million jobs at risk and led to the loss of $320 billion in exports. An approximately 60-80% decline in the international tourism economy in 2020 is expected to knock the global Gross Domestic Product (GDP) by 1.5-2.8%.

The tourism sector has received government stimulus funding, which may be enough to keep some — but not all — tourist goods and services alive. In fact, as many as one in three US museums may shut down forever due to the pandemic. To ward off a worse fate, the tourism industry has been proactive in cutting costs.

For example, New York’s Museum of Modern Art (MoMA) slashed its operating budget by $45 million, laid off staff, reduced its exhibition budget by $8 million, and gutted its publishing budget. This type of sweeping budgetary action is commonplace.

While some have tried to broaden their channels and offerings, launching social media initiatives and webinars, most have just tried to keep consumers interested by creating virtual tours. Now, the industry’s focus is on navigating a safe reopening, providing an enriching experience while respecting strict social distancing protocols. Innovation and investment will be vital in drawing back in customers, likely resulting in a reimagining of the tourism industry.

Film

The film industry has also been significantly impacted by COVID-19, with studios choosing not to release movies into empty theaters and creatives limited to the confines of their homes. After a record year in 2019, when the international box office reached $31.1 billion, 2020 is projected to result in an at least $5 billion loss because of the pandemic. Hundreds of thousands of workers in the industry have also had their jobs taken away following revenue drops.

The employment impacts are particularly concerning because of moviemakers’ heavy reliance on freelancers, leaving thousands of gig economy workers in limbo. Luckily, the government’s stimulus package did offer some relief to studios and freelancers, including extended flexibility for unemployment benefits. However, for the most part, the film industry has been left to figure things out for itself.

Some of the more prominent players, like Netflix, have used their places as industry leaders to support staff, setting up multi-million dollar relief funds for out-of-work production crews. Another strategy has been releasing movies previously scheduled for theater premieres during the pandemic directly to TVs to take advantage of many people’s increased screen-time.

Like with many other industries, the film industry has also turned to innovation as a solution, brainstorming ways that people can get out and view films without the daunting prospect of going to the movie theater. Drive-in movie theaters have begun popping up across the country, providing a platform for blockbuster releases as well as new independent movies.

About the Author


Headshot for Jemima McEvoy

Jemima is a journalist who enjoys reporting on business, particularly small business and entrepreneurship.

Related Articles