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COVID-19 Crisis: Using the Waffle House Index

4 MINUTE READ | March 30, 2020

COVID-19 Crisis: Using the Waffle House Index

PMG is providing near-daily observations on the economic implications of the COVID-19 outbreak. Today’s briefing is outlined below.

It’s Monday, March 30th, 2020. We hope you had a quiet, Netflix-filled weekend.

For at least a decade, the Waffle House Index has been a form of “back of a napkin” math used by FEMA and other agencies to determine the severity of disasters across America, measuring to what extent Waffle Houses remain open in a disaster-struck region. Given the chain’s disaster preparedness and almost-comedic resiliency, tragedies ranging from hurricanes to tornadoes haven’t stopped the chain from serving up hash browns and strips of bacon across its 2,000 diners in 25 states. But in the face of the coronavirus outbreak, the chain announced that the Waffle House Index is in the red as of last week — closing more than a fifth of its locations with sales down 70% nationwide. 

This is a big deal for two reasons: 

  • 1. It gives a clearer picture of how the outbreak is affecting life across regions not considered “hotspots” like Seattle and New York City. 

  • 2. Analysts have never used this marker to evaluate the socio-economic damage of a non-weather-related event. 

This week will be even more critical for the economy and consumers as rent and other payments are due at the first of the month, and with 3.3M unemployment filings in the U.S., and hundreds of thousands in Europe, we’re likely to see requests for deferments across the world. 

The biggest U.S. headline from the weekend came Sunday afternoon when President Trump announced the extension of the administration’s social distancing guidelines until the end of April. If you’re losing count of which states are under what restrictions, Forbes created up a helpful list. On the global stage, the head of the International Monetary Fund confirmed that the global economy entered a recession (as of this month) that “could be as bad or worse than the 2009 downturn.” 

Over the weekend, Apple released a new screening website and app in partnership with FEMA, the CDC, and the White House. This website boasts an easy-to-use interface and screening questionnaire, as well as recommended guidance ranging from self-isolation to getting tested. 

Big companies increased donations with Apple donating over ten million face masks, Google with $800M in ads and cash, and Johnson & Johnson announced a $50M commitment to supporting health workers. Disney Parks will remain closed until further notice, and several fundraising initiatives with star-studded lineups took place over the weekend.

  • On Saturday, Twitch hosted the 12-hour Stream Aid 2020 to raise proceeds for those on the frontlines.

  • On Sunday, iHeartRadio provided a Living Room Concert for America hosted by Sir Elton John that boasted A-List talent as a way to donate funds for health care workers and first responders.

After a disagreement over pricing, President Trump orders GM to move ahead with ventilator production under the Defense Production Act. Meanwhile, the USNS Mercy entered the Port of Los Angeles on Friday, and the USNS Comfort will arrive in Manhattan on Monday, both to provide beds and aid local hospitals overloaded by the pandemic

Over the past two days, reported confirmed cases of the coronavirus inched closer to 750,000 worldwide as calls for PPE and emergency supplies for health workers and those on the front lines rang louder.

Businesses deemed essential, but not medical, are beginning to face newfound stressors. More companies are also closing ecommerce stores as the lockdown wreaks havoc on supply chains or executives decide to do their part and reduce the risk of spreading the disease across their workforce. In distribution and delivery, warehouse workers at Amazon and delivery employees at Instacart staged strikes and walkouts after claiming their companies are not doing enough to protect them during this time.

In response, Instacart produced hand sanitizer in-house, and more advanced safety measures are likely on the way early this week. Barring a few, companies have been doing a fine job in remaining agile and doing what’s best for public health and safety — often stepping in to help and provide emergency supplies before being asked.

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It’s no secret that there have been countless tough decisions and circumstances resulting in a lack of preparation across nations for a human tragedy of this scale. But thankfully, with medical ships rolling in and shipments of PPE and emergency supplies being delivered by the plane-load to those most affected, we’re finally starting to see better cross-government agency collaboration and communication on a global scale as we head into the first week of April.


Posted by Abby Long

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