In the spring, as the new coronavirus began to spread throughout Central Florida, companies began shedding employees and Congress rushed in to provide some short-term relief.
Not knowing how severe the outbreak would become and how long its grip on the tourism-dependent region would last, executives hoped things would go back to normal soon.
But the layoffs haven’t stopped, and the calls to Congress for more help for the jobless and for the hotels, theme parks and other businesses that employed them have gone unanswered. It’s further evidence of the stark message Florida’s chief economist, Amy Baker, delivered to lawmakers Thursday that Florida tourism will take potentially three years to recover from this crisis.
In August alone, thousands more people were laid off or placed on furlough in Central Florida, mostly from hotels, according to a review of the state’s database.
The Hilton Orlando on Destination Parkway extended furloughs for 605 employees. The Orlando World Center Marriott laid off 601, saying it doesn’t expect occupancy to pick up until 2021. Eight Universal hotels, many of which have closed, furloughed or laid off 2,130 people.
KPMG Lakehouse, an 800-square-foot training center with a Hyatt-run hotel, also extended furloughs and converted some to permanent layoffs for 242 workers, just a few months after its much-anticipated ribbon cutting in Lake Nona. Across four Marriott locations, furloughs were extended or made permanent for 341 workers.
And Thursday morning, Disney’s chief financial officer Christine McCarthy said about half of the park’s dozens of hotels will remain closed through September, keeping hundreds of housekeepers, bellhops and restaurant workers from collecting a paycheck. For many of the furloughed, it also means going without health benefits during a public health crisis.
Bureau of Labor Statistics
US Department of Labor
It’s the same situation for companies that depend on the 70,000 daily outbound passengers Orlando International Airport used to draw, a number that has dwindled to about 20,000.
Frontier Airlines, which received a portion of a $25 billion federal bailout, said it will furlough 249 flight attendants and 97 co-pilots based at OIA. Flying Food Group, which provides inflight meals, and Mears, which stations rental cars and taxis outside the airport, also recently announced layoffs.
Hilda Renteria Hernandez, 33 of Orlando, was one of the 782 workers placed on furlough in March by HMSHost which operates restaurants at the airport.
After a year serving tables at Chili’s, in August, she found out she’d be permanently let go if she wasn’t called back by October.
“It was just shocking how quickly I went from being stable and having a little bit of savings and some future plans to feeling like I’m at the bottom again,” she said.
Hope for short crisis When the pandemic began, companies were optimistic the pandemic would be short-lived, writing in letters to the state that it expected furloughs to only be temporary and for business to pick up again soon.
But as the virus outbreak worsened and more restrictions were put in place to try to slow it down, they began to realize the true severity and the long-term effects it would have on their industries.
“While we hoped the COVID-19 pandemic would end rapidly, that current health and economic conditions would change, and that we would be able to recall these employees as soon as possible … we have determined that our business and occupancy levels are not projected to return to a sustainable level for the foreseeable future,” Lana Burke, a general
manager with Crestline Hotels & Resorts, wrote to the state.
“Regrettably, it has become apparent that these layoffs will extend beyond six months.”
US Department of Labor Statistics
Several of the notices filed in August were to let the state know that March and April furloughs would persist.
“Companies that used the word furlough when this first happened, they’re saying we’re ending your furlough and you’re now being permanently laid off,” said Eric Clinton, president of Unite Here’s local 362 union, which represents about 8,500 attraction and custodian workers at Disney’s Orlando theme parks.
Back in March, to stave off permanent layoffs, Congress quickly enacted the Paycheck Protection Program, a forgivable loan for up to $10 million designed to help companies keep on employees and cover payroll expenses.
The program, created as part of Congress’ $2 trillion relief package, was meant to help small businesses, but a special rule written into the legislation at the request of industry
lobbyists allowed large hotels and restaurants to qualify.
Some of those same lobbying groups also later asked legislators to tweak the program so they could spend less of the money on workers and more on other expenses.
But the PPP loans provided only enough money for about 2½ months, and now as that
assistance runs out, the hotel industry is pushing for more help, arguing that it has been one of the hardest hit by the pandemic and will be one of the last to recover. A recent report from the American Hotel & Lodging Association said 4 out of 10 hotel employees are still out-of-work and almost two thirds of hotels across the U.S. are at most half full.
“Thousands of hotels can’t afford to pay their mortgages and are facing the possibility of foreclosure and closing their doors permanently,” said Chip Rogers, president and CEO of AHLA. “We are incredibly worried about the fall and what the drop in demand will mean for the industry and the millions of employees we have been unable to bring back.”
He added that most of the money from PPP loans has been used up.
Now, commercial real estate industry lobbyists are blitzing Congress to pass the “Helping Open Properties Endeavor Act,” or the HOPE Act. The legislation would offer emergency cash infusions to companies that had previously taken out certain types of loans that made them more vulnerable.
The tourism industry also has floated a plan among lawmakers to provide up to $4,000 in tax breaks to encourage Americans to start traveling again. And Visit Florida, the state’s publicly funded tourism marketing agency, recently unveiled a $13 million ad campaign to get Floridians to travel instate.
But labor unions have pushed back against the idea of providing more relief to large corporations and instead said Congress should focus on getting money directly to the workers themselves.
Relief packages stall For months, Democrats and Republicans have been at an impasse over what to prioritize in the next relief bill.
Senate Republicans have refused to take up the $3 trillion HEROES Act passed by the Democrat run House that would provide stimulus checks and $175 billion in rental and mortgage assistance. Senate Democrats on Thursday voted down a slimmed down package proposed by the GOP that included $257 billion for the Paycheck Protection Program.
Cindy Huddleston, senior analyst at the Florida Policy Institute, said the continued layoffs are evidence that Congress needs to pass another relief package that includes a second round of stimulus checks, an extension of federal unemployment and expanded access to food stamps.
Huddleston noted that statewide the Department of Children and Families, which administers cash assistance, food stamps and Medicaid, received requests for assistance from more than 264,000 people statewide in August, a 37% increase since last year.
From Orange County, it received applications from more than 20,000 people, a 43% increase.
“The need is still out there, and it’s only getting worse,” Huddleston said.
Just last week, SeaWorld Entertainment, which operates 12 parks across the United States, said it would lay off some workers who had been put on furlough.
Universal Orlando has also laid off an undisclosed number of employees, and at least 20,000 Disney workers have yet to be recalled.
Still, the message from the state has been focused on the industries that are bouncing back and that have been able to reopen and bring back workers.
“Business are adding back to their payrolls, they’re opening up, they’re adding jobs back,” Adrienne Johnston, chief of the Department of Economic Opportunity’s Bureau of Labor
Market Statistics said in August, despite 1.13 million Floridians still unemployed.
In July, unemployment in Florida was at 11.3%. It’s worst in Central Florida, where joblessness was at 15.3%.
Baker, the state’s economist, predicted unemployment wouldn’t fall to 6% until April 2023.
“We have seen a lot of people going back to work; however, it is nowhere near sufficient to compensate for the mass layoffs we saw earlier this year,” said Rich Templin, a lobbyist for Florida AFL-CIO, a statewide federation of labor unions. “We still have some industries that are still completely unemployed.”
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