Santa Barbara County is being hit hard by COVID-19 on multiple fronts, but as with previous disasters, recovery is possible. It’s just going to take a while, and the recovery won’t be enough to save all of the businesses that have been affected.
In a webinar on April 16, experts in several fields joined Peter Rupert, an economics professor at UC Santa Barbara and the director of the Economic Forecast Project, to speak about impacts to different parts of Santa Barbara County and what support they are either giving or need from the community.
Rupert shared differing predictions on how badly the economy will be affected by the pandemic. The Economic Policy Institute estimates America will lose almost 20 million jobs, but the St. Louis Federal Reserve projects more than twice that number with 47 million jobs shed.
In the worst case scenario, about four of every 10 working Americans would be out of a job. In Santa Barbara County, it would be a little better, but not much – only three in 10 would be out of a job.
The industries that have been and will continue to be hit the worst are leisure, hospitality and tourism, all key parts of Santa Barbara County’s economy.
Visit Santa Barbara CEO Kathy Janega-Dykes gave more insight into how bad the crisis has been for the tourism industry in Santa Barbara County and the state as a whole.
California has lost 86 percent of travel-related revenue from this time in 2019, and the pandemic came when hotels were already coasting on fumes. Winter tends to be a less-busy time for the Central Coast, so hotels use spring break as a way to survive until summer, when demand explodes.
“This was the absolute worst time,” Janega-Dykes said.
Visit Santa Barbara expects the crisis to change how people travel, at least for the foreseeable future. As more people eschew bigger cities, where the chances of coming into contact with coronavirus are higher, she expects people to stick to more out-of-the-way regions they can drive to.
That makes the Santa Barbara region appealing, especially for day-travelers from Los Angeles.
There’s also a lot of pent-up demand to travel. During the webinar, Janega-Dykes cited a survey which found that seven of 10 Americans miss traveling. Once restrictions have been lifted, there will be a lot of people who want to get out of the house they’ve been trapped in for the past several weeks, and quick trips will be especially attractive.
The trick will be helping businesses survive to the point where people can travel again.
“Coming back is not as easy as turning the lights back on,” Rupert said.
Sherry Villanueva, founder of Acme Hospitality, runs almost a dozen food and beverage locations in Santa Barbara, with most of them in the Funk Zone.
Villanueva had to lay off almost all of her employees as a result of the crisis, and she’s not alone. There are more than 940 restaurants in Santa Barbara County, employing more than 18,000 people, and most restaurants have had to reduce their staff, either because of reduced demand or just because services like takeout and delivery weren’t enough to sustain the business.
These jobs make up about half of all tourism and hospitality jobs in Santa Barbara County, and unfortunately, the California Restaurant Association estimates up to 30 percent of all restaurants in could permanently close as a result of the crisis.
There are resources for businesses, including those reliant on tourism, but loans like the Payroll Protection Program don’t work as well for restaurants like the ones Villaneuva owns.
In order to qualify for the loan, all of the employees have to be brought back on the payroll. But the restaurants are still closed.
“The fear is that those employees will have to be laid off again in two months, when the loan runs out,” Villanueva said.
Additionally, while Janega-Dykes encouraged people to support their communities through gift cards and takeout, Villanueva warned that those solutions can just push pain farther down the road for some restaurants, which might not have the resources to honor gift cards when people try to redeem them in the near future.
Still, the consensus was that even with how difficult this has been, it’s worth it to protect the most vulnerable in the community. Lynn Fitzgibbons, chair of the Infectious Diseases Division at Cottage Health, thanked everyone watching and participating in the call for their work in social distancing.
“Lives have been unequivocally saved,” Fitzgibbons said.
She spoke about treatments for coronavirus. While there is no proven treatment for the disease, there are options being explored, and even if there is no proven treatment, previous pandemics (like Ebola) have shown how important supportive care can be.
Social distancing isn’t just to help reduce the spread — it’s also to help reduce the load on hospitals providing the supportive care. As leaders are trying to figure out how to lift restrictions, Fitzgibbons warned that a rebound of infection is inevitable in a non-immune population.
“We need to return to full capacity in a slow, measured fashion,” Fitzgibbons said.
Still, she praised the preparations civic and medical leaders have made and are making.
“We are now better prepared to handle a slow return to normalcy than we would have been in February or March,” Fitzgibbons said.
• Contact Amber Hair at [email protected]