Florida Economy Hit Hard by Outbreak in Tourist Season

Spring break revelers on the beach in Pompano Beach, Fla., on March 17, 2020. (AP Photo/Julio Cortez)

(CN) –– Florida’s spring break ended almost as soon as it began.

After national outcry over images of partiers on the state’s beaches, Governor Ron DeSantis and local officials began closing bars and beaches and restricting restaurant capacity. A few days later, state officials ordered all restaurants closed, except for take-out.

Disney World, SeaWorld, Universal Orlando, Busch Gardens and other theme parks shuttered. State parks followed. Cruise lines canceled reservations until May.

Major League Baseball ended spring training. The National Hockey League suspended the season. Wrestlemania, originally set to fill seats at Tampa’s Raymond James Stadium this weekend, will now take place at an empty venue in Orlando.

Local officials even blocked the road into Key West.

“The party is over,” DeSantis said on March 19 as tourists left hotels and rented vacation homes across the state.

Florida Gov. Ron DeSantis speaks at a coronavirus mobile testing site in The Villages, Fla., on March 23, 2020. (AP Photo/John Raoux, File)

March, typically the best month for the state’s $85 billion tourism industry, quickly became a bust.

“Sales have dropped 90%,” said Adam McLean, owner of seafood restaurant Groupers in Indian Rocks Beach. “It’s just me and my son working. Very hard times.”

As the coronavirus outbreak ravages communities across the country, experts say Florida’s economy could feel the pandemic’s effects more than any other state.

“Florida’s economy is broadly based on tourism,” Nathaniel Line, professor at Florida State University’s Dedman School of Hospitality, said in an interview. “Relative to states like Idaho, for example, we have far more hotels, attractions and restaurants. In turn, there are far more people that depend on those types of establishments being open for their livelihood.”

Already, the effect on the state’s hotel industry is devastating: 99% of lodging establishments experienced drops in bookings 30 days out and 94% reported cancellations 60 days out, according to a study by Destinations Florida, a marketing organization.

Hotel occupancy currently stands at 23%, the study noted, compared to 83% in March 2019.

Geoff Luebkemann, senior vice president of the Florida Restaurant and Lodging Association, said occupancy rates are in the single digits for many of the large resort hotels in the state.

“Or some chose to go dark altogether until this is over,” he said.

Last week, the Ritz-Carlton Grande Lakes Orlando, a massive 582-room luxury hotel, announced it will close through the end of May.

“It’s going to be lifechanging,” Luebkemann said. “There’s no question about that.”

One of the unknown results of this pandemic, he said, will be where those smaller operators land.

“One fact about our business is today’s sales pay yesterday’s bills,” Luebkemann said. “Those folks don’t have a big safety net or cushion to rely on.”

In a study conducted by Florida Gulf Coast University, more than 63% of businesses in Collier, Charlotte and Lee counties –– home to some of the state’s most popular beaches –– have seen customer demand fall by 50%. Smaller businesses with fewer than 25 employees have seen demand for products or services fall 70%.

Just two Florida counties alone — Sarasota and Manatee — face a $2.3 billion blow to their economy over the next three months, according to data firm StratoDem Analytics.  

“When restaurants, bars, hotels, attractions and retail establishments close down and cruise ships aren’t docking, people are out of work,” said Line, the Florida State University professor. “I think that’s the biggest issue right now is the unemployment.”

Tens of thousands of Floridians apply for unemployment benefits each day, clogging the Department of Economic Opportunity’s phone lines and causing the website to lag.

Last week, Florida received more than 227,000 new unemployment claims. Over 74,000 applied the week before –– more than 10 times the number of people in the first week of March.

“I really need a break,” said Joe Daniels, 36. “I need a miracle.”

Daniels is one of those workers not typically thought of during the pandemic. He sells items at flea markets around central Florida. With those markets closed, he must rely on sales through Facebook Markeplace or Craigslist. But with social distancing, people are not as eager to meet.

“Facebook right now is not working,” he said.

With so many Floridians out of work, other sectors of the state’s economy will suffer.

Consumer confidence is at an all-time low, according to a study from the Economic Analysis Program at the University of Florida’s Bureau of Economic and Business Research. The month-to-month decline in consumer confidence is the largest since the survey began in 1985.

Although the state’s economic outlook is grim, Line said Florida’s economy is resilient.

“In the midst of a crisis, things always appear worse than they are,” the professor said. “While the scale of this crisis is unprecedented, of course, this is not the first time we faced significant demand shocks.”

Line pointed to past hurricanes, the 2008 recession and a drop in travel after the Sept. 11 attacks.

“In every case, we bounced back,” he said. “Florida’s beaches are still going to be there.  The attractions will still be there.”

“People are not going to stop coming to Florida,” he added.

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