MIAMI - Miami-Dade County hotel and restaurants - the two largest hospitality industries in South Florida - have taken a $3.36 billion dollar hit from COVID-19, according to a new study.

The study released today by Florida International University's FIU Chaplin School of Hospitality & Tourism Management, in collaboration with the Greater Miami Convention and Visitor's Bureau (GMCVB), shows that from the time mandatory COVID-19-related business closures took effect in March until the end of August, the direct and indirect effects of the pandemic - including revenue loss, supply chain and business expenditures, operating expenses and the ripple effect of furloughed workers not spending on the local economy — resulted in the multi-billion-dollar loss.

According to the study, the pandemic is responsible for $1.3 billion in direct revenue loss to hotels and $742 million in direct revenue loss to restaurants, when comparing March through August 2019 with the same time period in 2020. Hotels and restaurants lost another $664.7 million in indirect spending from a reduction in expenditures such as raw materials, supplies and other operating expenses, plus another $651.8 million in induced losses as a result of the ripple effect of furloughed workers not spending on the local economy.

"As hospitality educators, we needed to find out exactly how the pandemic affected our community and who has been the hardest hit," said Eric Beckman, revenue management professor at the Chaplin School of Hospitality & Tourism Management and lead author of the study. "South Florida's economy has a high reliance on the hospitality and travel-related business and our study shows if those sectors are down, it results in huge financial losses and an economic decline for the entire community."

Beckman and his colleagues made their findings by looking at tax revenue data from the county, as well as hotel room revenue data from companies such as STR, CBRE, Lee Pillsbury of Thayer Ventures, Adara and Kalibri Labs.

In January, hospitality employment was up 2.4 percent compared to January 2019. That positive trend continued into February before plummeting in April to a 45.4 percent decline. The latest data for August 2020 shows a decrease of 23.7 percent in hospitality jobs compared to August 2019. The study also found that COVID-19 can be blamed for $1.2 billion dollars in loss of employee income to Miami-Dade County hotel and restaurant workers from March through August.

"As the entire country faced mandatory closures, there was a drastic reduction in hospitality jobs in the county," said Michael Cheng, dean of the Chaplin School and one of the study's co-authors. "As we move towards operating without restrictions. the hospitality industry will begin to move towards prior levels of employment and growth."

Although focused on hotels and restaurants, the study also looked at the state and federal tax impact and the decline in travel via Miami International Airport. The reduction in hotel and restaurant sector revenue in the county resulted in more than $260 million dollars in federal tax losses. From March through August of 2020 compared to 2019, there was an 87.2% decrease in international arrivals and 71.8 % decrease in domestic arrivals.

The study goes on to list future challenges to the industry, such as future COVID-19 outbreaks, effectiveness of a vaccine, consumer ability to travel, consumer confidence and the importance of government policy and support. The authors say government policy and support, such as this summer's Payroll Protection Program (PPP), will be crucial to the existence of many businesses that have managed to re-open their doors and survive until now.

"The hospitality industry is a resilient industry filled with ambitious entrepreneurs and people who know how to transfer their skills," Beckman said. "That, combined with the fact that we know people love to travel and eat out, will result in the resurgence of travel and tourism in Miami-Dade County."

To view the study's PowerPoint presentation, click here.

ABOUT FIU
Florida International University is Miami's public research university, focused on student success. According to U.S. News and World Report, FIU has 26 top-50 rankings in the nation among public universities and Washington Monthly Magazine ranks FIU among the top 20 public universities contributing to the public good and No. 12 for social mobility. FIU is a top U.S. research university (R1), with more than $200 million in annual expenditures. FIU ranks 15th in the nation among public universities for patent production, which drives innovation, and is one of the institutions that helps make Florida the top state for higher education. The Next Horizon fundraising campaign is furthering FIU's commitment to providing students Worlds Ahead opportunities. Today, FIU has two campuses and multiple centers, and supports artistic and cultural engagement through its three museums: Patricia & Phillip Frost Art Museum, the Wolfsonian-FIU, and the Jewish Museum of Florida-FIU. FIU is a member of Conference USA, with more than 400 student-athletes participating in 18 sports. The university has awarded more than 330,000 degrees to many leaders in South Florida and beyond. For more information about FIU, visit www.fiu.edu.

ABOUT FIU'S CHAPLIN SCHOOL OF HOSPITALITY & TOURISM MANAGEMENT

Florida International University's Chaplin School of Hospitality & Tourism Management is a Top 10 hospitality school among U.S. Public Universities and ranked 35th in the world. More than 1,200 undergraduate and graduate students from across the nation and around the globe choose FIU for its outstanding reputation, advantageous campus locations in Miami, expert faculty, rich curriculum and real career opportunities in the international hotel, foodservice, beverage and spirits management, travel, tourism, revenue management, entertainment, and mega and large-scale event industries. As the leading diverse hospitality program with over 70% women and students from 74 countries represented, Chaplin School graduates more undergraduate Black, Hispanic and International students than any other school. For more information about Florida International University's Chaplin School of Hospitality & Tourism Management, visit http://hospitality.fiu.edu.

ABOUT FLORIDA INTERNATIONAL UNIVERSITY (FIU)

Florida International University is a top public university that drives real talent and innovation in Miami and globally. Very high research (R1) activity and high social mobility come together at FIU to uplift and accelerate learner success in a global city by focusing in the areas of environment, health, innovation, and justice. Today, FIU has two campuses and multiple centers. FIU serves a diverse student body of more than 56,000 and 270,000 Panther alumni. U.S. News and World Report places dozens of FIU programs among the best in the nation, including international business at No. 2. Washington Monthly Magazine ranks FIU among the top 20 public universities contributing to the public good.