Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
Impacts of COVID-19 on Maine’s Hospitality Sector1
Todd Gabe and Andrew Crawley2
School of Economics Staff Paper #638
University of Maine
June 2020
Version 1.13

This report shows the following:

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Maine hospitality sales fell by 35 percent between March of 2019 and 2020, and 63
percent between April of 2019 and 2020.

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The impacts of COVID-19 on the Maine hospitality sector resulted in a 66-percent
reduction in daily consumer spending at restaurants and lodging establishments
between January and early April of 2020, 50-percent reduction between January and
early May, and 33-percent reduction between January and early June.

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Accounting for the large impacts related to COVID-19, the Maine hospitality sector
will generate a 2020 statewide economic contribution—including multiplier effects—
of an estimated $4.6 billion in revenue, 46,196 full- and part-time jobs, and $1.6
billion in labor income.

This analysis was conducted at the request of Hospitality Maine.
Todd Gabe is a Professor in the School of Economics and author of the book Pursuit of Economic
Development: Growing Good Jobs in U.S. Cities and States. Andrew Crawley is an Assistant Professor in the
School of Economics. Crawley’s research program is funded, in part, by Hatch Project #1016274 from the
USDA National Institute of Food & Agriculture. Gabe’s research program is funded, in part, by Hatch
Multistate Grant # ME 031808 (NE 1749) from the USDA National Institute of Food & Agriculture. Professor
James C. McConnon, Jr. provided helpful comments on an early draft of this report.
The analysis presented in this report is based on information as of June 23, 2020. The report may be revised
as new data are released.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
Impacts of COVID-19 on Maine’s Hospitality Sector

1.

Introduction
In March of 2020, many U.S. cities and states imposed a variety of measures to slow the

spread of COVID-19. These include encouraging people to practice social distancing, prohibiting
the assembly of large groups, and the shutdown of many nonessential businesses. Businesses
such as restaurants, hotels, movie theatres, live sporting events and theme parks were
particularly impacted by the COVID-19 restrictions because they often have large numbers of
people in confined spaces. For example, the number of reservations at U.S. restaurants was 14percent lower on March 9 (compared with the previous year), 28-percent lower on March 12,
and 56-percent lower on March 16. The year-over-year decrease in reservations fell to 99percent on March 20, where it remained until early May of 2020.4
This report examines the impacts of COVID-19 on Maine’s hospitality sector, defined to
include restaurants and lodging establishments (e.g., hotels and motels). We examine monthly
trends in Maine hospitality sales over the first one-third of 2020 and analyze the sector’s
estimated economic contribution for the entire year, accounting for the COVID-related
reductions in sales. The analysis is based on data from Maine Revenue Services and the
Opportunity Insights project of Chetty et al. (2020). The results show 35-percent and 63-percent
reductions in hospitality sales in March and April, compared with the same months in 2019, and

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These figures are from the OpenTable online restaurant reservation website.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
the sector’s 2020 annual economic contribution is estimated to be 33-percent lower than its
contribution in 2018 (Gabe and Crawley 2019).5

2.

Analysis and Results
Figure 1 shows monthly hospitality sales in Maine for all of 2019 and the first four months

of 2020. In both January and February, hospitality sales were 12-percent higher in 2020 as
compared with 2019 (not adjusted for inflation). Maine hospitality sales fell by 35 percent
between March of 2019 and 2020, and 63 percent between April of 2019 and 2020. Since Maine’s
hospitality sector is characterized by robust seasonal increases during the summer months, its
performance in June, July and August will have a large influence on the sector’s total sales in
2020.
Figure 2 shows daily COVID-related impacts on Maine’s hospitality sector from March 1
to June 17, 2020. The figures show a very sharp decline in Maine consumer spending at
restaurants and hotels starting in the middle of March, with spending down by about 66 percent
(relative to the period of January 4 to 31, and accounting for seasonality) around the beginning
of April. By early May of 2020, Maine hospitality spending declined about 50 percent and about
33 percent by early June, as a result of COVID-19.
Figure 3 shows annual Maine hospitality sales from 2004 to 2019, adjusted for inflation
to 2019 dollars, along with estimated 2020 hospitality sales. The 2020 hospitality sales figure of

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The hospitality industry’s 2020 estimated annual economic contribution of $4.6 billion in revenue is
compared to the sector’s 2018 economic contribution of $6.9 billion in revenue (Gabe and Crawley 2019),
which gives a decrease of 33 percent. Comparing the hospitality sector’s 2020 estimated annual economic
contribution to its economic contribution in 2019 would show a larger reduction.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
between $2.5 billion and $2.8 billion uses actual data from January to April and estimates for the
period May through December. These estimates are based on scenarios similar to the daily
COVID-related impacts presented in figure 2. Compared with 2019 hospitality sales of about $4.3
billion, the estimated annual sales in 2020 are expected to experience a decrease of between 35
and 42 percent.
Table 1 shows the Maine hospitality sector’s estimated statewide economic contribution
for all of 2020, accounting for the COVID-related reduction in sales. The direct revenue of $2.65
billion is the midpoint of the $2.5 billion and $2.8 billion from figure 3. The direct employment of
33,085 full- and part-time jobs is the number of workers supported by $2.65 billion in revenue,
estimated by the Maine IMPLAN model, and the model suggests about $1.0 billion in labor
income earned by these workers. The estimated $2.65 billion in 2020 hospitality sales will
generate a statewide economic contribution—including multiplier effects—of $4.6 billion in
revenue, 46,196 full- and part-time jobs, and $1.6 billion in labor income. The $4.6 billion in
statewide revenue is 29-percent and 33-percent lower than the Maine hospitality sector’s
economic contributions in 2017 and 2018 (Gabe and Crawley 2018, 2019).6

3.

Summary
The Maine hospitality sector has experienced large declines in economic activity as the

result of COVID-19. Taxable hospitality sales in March of 2020 were 35 percent lower than sales

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The hospitality industry’s 2020 estimated annual economic contribution of $4.6 billion in revenue is
compared to the sector’s 2018 economic contribution of $6.9 billion in revenue (Gabe and Crawley 2019)
and its 2017 economic contribution of $6.5 billion (Gabe and Crawley 2018), which gives a decrease of 33
percent and 29 percent, respectively. Comparing the hospitality sector’s 2020 estimated annual economic
contribution to its economic contribution in 2019 would show a larger reduction.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
in March of 2019, and sales fell by 63 percent between April of 2019 and 2020. COVID-related
impacts on the Maine hospitality sector resulted in about a 66-percent reduction in daily
consumer spending between January and early April of 2020, 50-percent reduction between
January and early May, and 33-percent reduction between January and early June. Accounting
for these large impacts related to COVID-19, the Maine hospitality sector will generate a 2020
statewide economic contribution—including multiplier effects—of an estimated $4.6 billion in
revenue, 46,196 full- and part-time jobs, and $1.6 billion in labor income. This represents a 33percent decline relative to the sector’s statewide economic contribution in 2018 (Gabe and
Crawley 2019).7

References
Chetty, Raj, John N. Friedman, Nathaniel Hendren, Michael Stepner, and the Opportunity Insights
Team. 2020. “Real-Time Economics: A New Platform to Track the Impacts of COVID-19 on
People, Businesses, and Communities Using Private-Sector Data.” Mimeo.
Gabe, Todd, and Andrew Crawley. 2018. “Economic Contribution of Maine’s Hospitality Sector.”
Version 1.0. Mimeo.
Gabe, Todd, and Andrew Crawley. 2019. “Economic Contribution of Maine’s Hospitality Sector.”
Version 2.0. Mimeo.

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The hospitality industry’s 2020 estimated annual economic contribution of $4.6 billion in revenue is
compared to the sector’s 2018 economic contribution of $6.9 billion in revenue (Gabe and Crawley 2019),
which gives a decrease of 33 percent. Comparing the hospitality sector’s 2020 estimated annual economic
contribution to its economic contribution in 2019 would show a larger reduction.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020
Table 1. Estimated Statewide Economic Contribution of Maine’s Hospitality Sector: 2020
Direct
Multiplier Effects
Total
Revenue

$2,650,000,000

$1,975,344,167

$4,625,344,167

Employment

33,085

13,111

46,196

Labor Income

$999,435,987

$629,903,597

$1,629,339,584

Notes. Direct revenue of an estimated $2.65 billion is based on data from Maine Revenue
Services, Chetty et al. (2020) and authors’ calculations. Direct employment and labor income, and
multiplier effects are from the Maine IMPLAN model.

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020

 Impacts of COVID-19 on Maine’s Hospitality Sector: Gabe and Crawley, June 2020