Last night, Friday, at around 7:30 p.m., we had only a 30 minute wait for our table at Joe’s of Westlake. We found a table near the piano in the bar to wait. Weird. Normally, we’d have to wait about a hour for dinner, or head over to the more expensive Gold Mirror restaurant for a quick seat. And normally we’d have to hang around like vultures to grab a table in the bar for the wait. So I wondered, “Is the shorter wait an indication that the economy hasn’t yet recovered from recession, or are people’s tastes in restaurants changing?” The same thought had occurred to me a few weeks before when we had a short wait on a Friday night.
Back in June, my husband and I were seated immediately at Carpaccio’s, our favorite restaurant here in Menlo Park. Before the recession, you couldn’t count on a table any day of the week without reservations. But the Saturday evening before our wedding anniversary, we decided to try for a table in the bar area. We dropped in and were instead seated in the dining area (with a choice of tables). Dressed in my yoga wear, I wish I’d dressed a little better and thought, “This is weird, I thought the economy was in recovery.” I realize that the National Bureau of Economic Research (NBER) has not yet called an end to this recession, but I like to be optimistic.
Turns out that restaurant traffic nationally was down in May, according to the National Restaurant Association’s Restaurant Performance Index (May is the latest data reported, on June 30th). And although restaurant operators remained optimistic about future sales growth, their optimism has been slipping.
Now I love being able to stop by my favorite restaurants and get a seat quickly, rather than be turned away or wait an hour, but I’m concerned.
With unemployment insurance benefits running out for many Americans, government spending falling (and the tax reduction stimulus of the American Recovery and Reinvestment Act of 2009 ending), spending in the economy will grow more slowly or even fall.
So right now, consumer and business confidence in the economy is low, and our central banker, Ben Bernanke, is concerned about the U.S. small business sector. Mr. Bernanke spoke recently on “Addressing the Financing Needs of Small Businesses” in Washington, D.C., concerned about our need for small businesses to restore job growth in the economy. And there’s a lot of excess capacity out there. The industrial capacity utilization rate was a low 75% in June (the motor vehicle and nonmetal minerals industries are operating at only 60% capacity). With businesses sitting on the sidelines in this “economic recovery,” it seems unlikely that private business investment will rebound, which means the NBER is unlikely to call an end to this recession by the 2nd quarter of 2010.