Danny Meyer's Union Square Hospitality Group laid off about 2,000 workers on Wednesday, citing a "near complete elimination of revenue" due to the coronavirus pandemic.
Restaurants across the country are laying off workers as the outbreak closes dining rooms and consumers cook food at home. The National Restaurant Association estimates that between 5 million and 7 million restaurant jobs will be lost over the next three months.
"Never could I have fathomed a time where the only path forward would be to lay people off so they can receive unemployment, while this company fights to see another day when we can return to our full staffing levels," Meyer, the company's CEO, said in a statement.
The New York-based restaurant company shuttered all of its restaurants Friday until future notice. Meyer is donating his salary, along with "substantial" pay cuts for executives, to a fund for the company's employees. Roughly 20% of the company's workforce remains. USHG is planning to rehire as many employees as possible when conditions permit.
Full-service restaurants are expected to be hit the hardest by the pandemic. Black Box Intelligence found that full-service restaurant traffic declined 3.7% in the week ended March 8. Areas with clusters of the virus, such as Seattle, have seen their restaurants hit even harder.
Dan Simons, owner of Washington, D.C.-based Farmers Restaurant Group, estimated that roughly 97% of the company's revenue has been wiped out after closing its dining rooms. Its Founding Farmers restaurants now are only serving curbside pickup and delivery. FRG temporarily laid off all of 1,100 of its hourly workers.
"We're making the best decisions that we can so that we can survive in the short term in order to get back and thrive in the long term," Simons said in an interview. "The most important thing for me is to get back in the position where I can create those jobs again and bring those people back."
The National Restaurant Association asked the federal government for financial assistance, including a $145 billion recovery fund for restaurants, a federal loan program and tax measures.
Correction: Danny Meyer's Union Square Hospitality Group laid off about 2,000 workers on Wednesday. An earlier version misstated the day. Dan Simons is owner of Washington, D.C.-based Farmers Restaurant Group. An earlier version misspelled his name.