Stimulus checks, jobless benefits not reviving the hospitality sector


Good afternoon,

Recent releases from the office of the Delaware State Treasurer and the Delaware Department of Labor contain some eyepopping numbers.

So far, the combination of the stimulus checks and jobless benefits since the Covid-19 pandemic took hold in mid-March totals  $1.7 billion or more than  $1,700 for every man, woman, and child in the state. 

The stimulus checks amount to a little less than half of the total, based on figures from the state  Treasurer’s office. For any number of reasons, a sizable number of Delawareans still have not received the checks that amount to $2,400 for a couple, 

The pandemic  benefits included the Pandemic Assistance checks of $600 a week. Businesspeople complained the payment led many workers to stay on the sidelines after their establishments began to reopen. Others said the program boosted the economy at a critical time. 


The Pandemic payments ended in late July and were recently replaced by a $300 a week Lost Wages payment that will last for a limited time with current funding.

We do know that unemployment checks typically go back into groceries and other necessities.

 Stimulus checks have more of an indirect impact since many people who held on to their jobs banked the proceeds. That is good news when it comes to an abysmal savings rate in Delaware and elsewhere, but it may not do  much to jump-start the economy

As a recent article in The Atlantic noted, many consumers have been squirreling away a lot of money this year or paying down their credit card balances.

The reason? The pandemic means many people are not traveling or frequenting restaurants, especially establishments with higher price points that attract an older and often more cautious clientele.

The spending slump is reflected in recent unemployment figures from the state Department of Labor. On Friday,  the department reported an 8.9 percent jobless rate. (Many economists believe that rate is far higher).

The subdued spending has hammered the state’s travel-hospitality industry, a big recipient of travel and dining spending.  

The Delaware jobless figures showed the hospitality sector accounting for nearly 14,000 of the more than 41,000 jobs that have been lost in 2020.

As the pandemic drags on, many don’t see a resurgence in the hospitality sector until a vaccine becomes widely available.

That’s of little comfort to those working what was once a key driver of economic growth in the state. – Doug Rainey, chief content officer.