Are French Restaurants More Likely than American to Survive the Lockdown?

France is not unique in seeing its service industry shut down in the midst of the COVID-19 pandemic. But compared to other countries, France has a robust safety net of social security, unemployment, and healthcare. France has also implemented emergency measures that may prevent many of these businesses from going under.

As French restaurants begin to slowly reopen for outdoor service, the culinary landscape in France looks very different when compared to the United States.

Government Aid: Two Countries, Two Philosophies

In March, President Emmanuel Macron said he would do “whatever it takes” to ensure that no company, big or small, collapsed under the financial weight of the pandemic. He announced 300 billion euros in loan guarantees and tax exemptions. The government also played a role in negotiating rent forgiveness for restaurants.

Perhaps even more helpful, at least in the short-term, were easy-to-access “solidarity funds:” 1500 euros per month given tax-free to small businesses, compounded with an additional allowance of up to 2500 euros from URSSAF, a social security union for small businesses. On April 15, Gérald Darmainn, Minister of Public Action and Accounts, also announced that the restaurant industry’s taxes and social charges – about 750 million euros – would be forgiven instead of merely suspended for the duration of administrative closure.

In the U.S., by contrast, most small restaurants didn’t qualify for loans, while huge corporations like McDonald’s and Shake Shack did. According to the New York Times, big chains were able to access “tens of millions of dollars while many smaller restaurants walked away with nothing when the $349 billion fund was exhausted [April 16].” The Los Angeles Times reported that those small businesses that did qualify were reluctant to apply for the Small Business Administration’s Paycheck Protection Program because of the “strings” attached to loans.

Restaurant Workers Feed Us, But Can They Eat?

As far as restaurant employees are concerned, in France, most are secure within the net of the country’s robust social structure. When forced closures were announced mid-March, restaurant workers were encouraged to first use up their paid vacation (an average of about five weeks per year) before becoming eligible for partial unemployment (the equivalent of 84 percent of their salary.) Continue reading “Are French Restaurants More Likely than American to Survive the Lockdown?”