What does the coronavirus have to do with efficiency? Not much, but it is meat for this blog.
I come from a business background where efficiency was the name of the game. It still is, but there some aspects that need to be further looked into. I think that most of us know that the economy can grows in only a limited number of ways. Those are (1) More workers, (2) Higher efficiency from a fixed number of workers, or (3) Paying workers more Of these three, the best one is (2). When we look back at the economic past, we often find these working in combination and if the reason for a growing economy is driven by (1) and (2), we don't have inflation. The answer for the recent growth in the USA economy without inflation is (2), efficiency. With the rapid application of new computer driven "tools", workers are much more "efficient". If you follow this, you will understand the following.
The coronavirus has hit bars and restaurants very hard. It is predicted that many will go out of business and never come back. To understand what is going on we need to look deeper into efficiency. Restaurants provide "food" for people and bars provide "liquor", but if you notice that during this pandemic that no one has starved Sales of food and liquor has gone thru the roof, that is if you don't net it out with the decline in restaurants and bars. People are still eating and drinking. They may, in fact, be eating more and drinking more. How can that be? I see the reduction in both restaurants and bars a shift toward better efficiency! People can eat more and drink more ans end up spending less. People are actually ending up saving by not going to restaurants and bars. If this pattern continues more people with have more money to spend some other place.
I just watched Alton Brown on one of his cooking shows demonstrate how much a person can save by eating at home. He took a $125 fancy steak meal and did the whole thing at home for about $25. His steak was as good or better than the restaurant steak. He had a great bottle of wine for less than 25% of what it would have cost in the restaurant and bar. That is a measure of the efficiency that is possible with the decline in restaurants and bars.
What about the people who work in these places? They are doing work that is clearly not efficient and thus, most should go out and get a more productive job. The many of them who dropped out of school or did other irresponsible things in their youth only have themselves to blame when they find it hard to get a job that demands more skill.
One further point. We hear that the mix of costs in restaurants and bars is different from other types of businesses and it is. A disproportionate amount of the restaurant and bar revenue appears to go to the land owner for rent. This says to me that we need to "follow the money" when our government wants to give these restaurants and bars "your money". It seems clear from what these people are saying that the money we give to the restaurant and bar owners is destined to end up in the pockets of rich land owners. Does this sound like some thing out of the middle ages?
The efficiency problem with restaurants and bars is not something new. It has been here all along and the coronavirus just exposed it for all to see. Since man invented his first tool, it has been greater efficiency that has driven the growth in quality of life for the human race! Don't forget that!
I come from a business background where efficiency was the name of the game. It still is, but there some aspects that need to be further looked into. I think that most of us know that the economy can grows in only a limited number of ways. Those are (1) More workers, (2) Higher efficiency from a fixed number of workers, or (3) Paying workers more Of these three, the best one is (2). When we look back at the economic past, we often find these working in combination and if the reason for a growing economy is driven by (1) and (2), we don't have inflation. The answer for the recent growth in the USA economy without inflation is (2), efficiency. With the rapid application of new computer driven "tools", workers are much more "efficient". If you follow this, you will understand the following.
The coronavirus has hit bars and restaurants very hard. It is predicted that many will go out of business and never come back. To understand what is going on we need to look deeper into efficiency. Restaurants provide "food" for people and bars provide "liquor", but if you notice that during this pandemic that no one has starved Sales of food and liquor has gone thru the roof, that is if you don't net it out with the decline in restaurants and bars. People are still eating and drinking. They may, in fact, be eating more and drinking more. How can that be? I see the reduction in both restaurants and bars a shift toward better efficiency! People can eat more and drink more ans end up spending less. People are actually ending up saving by not going to restaurants and bars. If this pattern continues more people with have more money to spend some other place.
I just watched Alton Brown on one of his cooking shows demonstrate how much a person can save by eating at home. He took a $125 fancy steak meal and did the whole thing at home for about $25. His steak was as good or better than the restaurant steak. He had a great bottle of wine for less than 25% of what it would have cost in the restaurant and bar. That is a measure of the efficiency that is possible with the decline in restaurants and bars.
What about the people who work in these places? They are doing work that is clearly not efficient and thus, most should go out and get a more productive job. The many of them who dropped out of school or did other irresponsible things in their youth only have themselves to blame when they find it hard to get a job that demands more skill.
One further point. We hear that the mix of costs in restaurants and bars is different from other types of businesses and it is. A disproportionate amount of the restaurant and bar revenue appears to go to the land owner for rent. This says to me that we need to "follow the money" when our government wants to give these restaurants and bars "your money". It seems clear from what these people are saying that the money we give to the restaurant and bar owners is destined to end up in the pockets of rich land owners. Does this sound like some thing out of the middle ages?
The efficiency problem with restaurants and bars is not something new. It has been here all along and the coronavirus just exposed it for all to see. Since man invented his first tool, it has been greater efficiency that has driven the growth in quality of life for the human race! Don't forget that!
