Glasses on a restaurant table.
Unsplash/Michael Browning

Applications for new businesses in the U.S. from June 2020 to May increased at the greatest pace on record since 2004, according to the National Bureau of Economic Research.

Yelp: New Restaurants Continue to Open at Rapid Pace

Most of the new business openings are coming in the South. 

Nearly 20,000 restaurants and food businesses opened in the second quarter, according to Yelp data, a sign that confidence is growing among industry operators.

The exact figure was 19,698, which is 12 percent lower than Q2 2019 (the highest period for new business openings in the past five years). Overall, Yelp saw roughly 151,000 new business openings in the second quarter, or an increase of 8 percent compared to 2019 and growth of 3.3 percent versus the first quarter.

Applications for new businesses in the U.S. from June 2020 to May increased at the greatest pace on record since 2004, according to the National Bureau of Economic Research. Categories accounting for the bulk of the surge include personal services; professional, scientific, and technical services; administrative and support services; truck transportation; and accommodation and food services.

Nine of the 10 states with the biggest increase in new business openings compared to pre-pandemic levels came in the South. The highest were Mississippi, (1,040 openings, up 52 percent), Alabama (2,035 openings, up 39 percent), Georgia (6,455 openings, up 37 percent), Kentucky (1,698 openings, up 37 percent), and Louisiana (2,000 openings, up 35 percent). More than 65 percent of states saw an increase in new business openings. States with a 5 percent or more decrease include Oregon (­–13 percent), Washington (–13 percent), New Mexico (–12 percent), South Dakota (–10 percent), California (–9 percent), and New York (–9 percent).


In terms of restaurant reopenings in Q2, the restaurant industry saw 22,441 reopenings via Yelp—the highest among all industries. Across all segments, 60,502 businesses reopened in the quarter, which is the highest in the past year. Of that amount, 38,725 came in April. That’s the largest batch of monthly reopenings Yelp has seen since May 2020 when roughly 45,800 businesses reopened.

Although restaurants are reopening at a huge pace, trends established during the industry—such as the rise in delivery—haven’t disappeared. The opening of food delivery services (670, up 166 percent) is well above pre-COVID marks. Other areas soaring past pre-pandemic levels in terms of openings are seafood markets (81, up 44 percent), soul food (176, up 30 percent), desserts (1,628, up 47 percent), and food courts (59, up 40 percent).


The opening and reopening of restaurants have been met with a wave of pent-up demand from consumers. More than 3.7 million diners were seated in May via Yelp, which is the largest figure the company has ever recorded. The number of diners seated via Yelp in May increased 48 percent compared to 2019. In April, the figure surged 46 percent compared to two years ago. Also, consumer interest in restaurants returned to 86 percent of 2019 levels from March to May after a significant drop in the year-ago period.

The areas that saw the biggest recovery in consumer interest were conveyor belt sushi (97 percent recovery of 2019 levels), tapas (82 percent recovery) hot pot (75 percent recovery), dim sum (84 percent recovery), and buffets (52 percent recovery). Also, interest in personal chefs and food delivery services from March through May of this year grew 138 percent and 189 percent, respectively, compared to 2019.

Data from Zenreach backs up Yelp’s findings. The company said nationwide restaurant foot traffic has increased 57 percent since the start of 2021. Megan Wintersteen, vice president of marketing for Zenreach, said it wouldn’t surprise her if the growth improved to 65 percent within the next three months. The markets with the biggest leap in foot traffic since January are San Jose (192 percent), San Diego (173.7 percent), Los Angeles (161.2 percent), Denver (151 percent), and New York City (132.5 percent).

However, many restaurants have been unable to truly reap the benefits of the growing traffic due to the ongoing labor crisis. In April, there were 9.3 million job openings in the U.S., a record-high for the Bureau of Labor Statistic’s Job Openings and Labor Turnover Survey. In May, openings dipped slightly to 9.2 million. Last month, the industry added 194,300 jobs, but restaurants are still 1.3 million short of February 2020's total workforce.