Bad News for Bars: Happy Hour Fading Away

The pandemic put a serious dent in the idea of happy hour, the New York Post reports. And that is continuing to have major repercussions for bars and restaurants in the Big Apple (and elsewhere).

“People used to work from 9 to 5. And you were happy at 5:01 because your workday ended,” Eugene Remm, co-founder of Catch Hospitality Group, told the Post. “But now there is no beginning of work and there is no end to work.

“So I think if you said ‘happy hour’ to 95% of [20 somethings] that used to do that on a regular basis, they would look at you and say, ‘Hey, Boomer, I don’t know what happy hour is.’”

Not only are New Yorkers working around the clock, but tee-totaling has gotten more popular. And news of Gen Z avoiding alcohol just as they get spending power isn’t an encouraging sign for those in the hospitality business. In fact, the decrease in the popularity of drinks — coupled with the rising cost of doing business in NYC — means restaurants must raise food prices.

“You used to have a formula where it would be food percentage, beverage percentage. That would be your entire sell. And the profits on beverage are 10X. The profits on food is 2X,” Remm said. “But costs for restaurants — like food, labor, and rent— are getting even more expensive, which means restaurants have to figure out a new way to make the numbers work. So when people stop drinking, that’s when the model has to change … Everyone has pivoted their habits, so the business still needs to sustain… the only thing that you can do is to raise prices.”

Still, Remm expects happy hours — and imbibing more generally — will eventually be on the upswing again.

“Everything is a cycle. And alcohol is something that’s been with us for 5000 years. I think it’s going to be with us for 5000 more,” he said.

Click here for the full Post story.