As Chattanooga begins to gradually reopen its economy following a month-long shutdown of thousands of local businesses, a new survey shows that most Chattanooga businesses have already taken a major hit from the coronavirus pandemic.

The COVID-19 virus cut business revenues for nearly three fourths of all companies, according to a new survey conducted by the Chattanooga Area Chamber of Commerce.

Among 250 local businesses responding to a Chamber survey conducted over the past five weeks, 60% said they have lost over half of their sales or revenues due to the virus and the business shutdowns it has caused. Nearly half of the businesses who responded to the Chamber poll said they expect to be closed for five to eight weeks and 43% expect to be shut down for more than nine weeks.

Chattanooga Mayor Andy Berke, who plans to give his annual State of the City address Thursday amid the ongoing pandemic, said the city's fortunes have changed dramatically from the end of last year when a Manpower survey predicted Chattanooga would be one of the nation's hiring hot spots in 2020 and few were forecasting any immediate recession.

"As we gradually work to reopen our city, we're hopeful that employment will begin to recover, but we know we have a long road ahead of us," Berke said in a preview of his address outlining plans for his final year in office.

Nearly one of every nine workers in Southeast Tennessee filed for jobless benefits in the past month since businesses began to shut down in mid March. A study by the personal finance web site MoneyGeek forecasts that the jobless rate in Chattanooga will rise to 29% with 80,000 workers displaced in the metro area.

Chattanooga's $1.1 billion-a-year tourism industry has been especially hard hit with the closing of all of the city's major attractions, including the Tennessee Aquarium, Rock City, Ruby Falls, the Creative Discovery Museum and even the Walnut Street Bridge due to the COVID-19 virus.

"The hospitality industry was hit the worst of any industry and it's been very difficult because social distancing is contrary to what we do in bringing people and families together to make lasting memories," said Hugh Morrow, president of Ruby Falls and chairman of HospitaltyTN, the state association of hotels, restaurants and attractions. "The hardest part of this was having to furlough so many of our associates who are like family, but we're going to come back and people will be traveling and coming to our attractions. We just want to make sure it is safe for everyone to do so."

Ruby Falls shut down on March 13 and idled about 80% of its staff. Morrow said the Ruby Falls gift shop may reopen on May 8, but he is unsure when the underground water falls will reopen to the public "even though we get people calling us every day wanting to visit."

Hiren Desai, president of 3H Hotels, operates 15 hotels in the Southeast and has kept the hotels open over the past six weeks using primarily just management staff after having to lay off most of the hourly staff.

"Business has certainly been down and may take a while to come back," Desai said. "We're taking precautions to make sure our employees and guests are safe and we have increased all of our cleaning and social distancing requirements. I think there is going to be a turnaround and travel will come back, but it's still hard to know when."

The tornado relief efforts following the Easter night storms filled more than 1,300 hotel rooms, according to EPB. But in the week ended April 11, only 24.2% of hotel rooms in Hamilton County were occupied, down from 63% a year earlier.

Retailers and restaurants were able to reopen in the Chattanooga area this week and Hamilton Place and Northgate malls plan to reopen Friday. That should bring some workers and shoppers back and help to reactivate the economy.

"But ultimately, the pace of the recovery will depend upon what consumers do and their level of confidence in wanting to get out and do activities and their economic confidence to do so," said Dr. William Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee.

Fox said the government-imposed slowdown to limit the spread of COVID-19 is unlike any previous recession in American history and is therefore difficult to predict the future. But with an equally unprecedented package of fiscal and monetary relief and stimulus from both Congress and the Federal Reserve Bank, even those losing their jobs temporarily are not as bad off as unemployed persons in previous economic downturns.

But the Chamber survey showed the anxiety about the future is high among local business owners. When asked to anticipate the severity of overall impact from COVID-19 on a 10-point scale where one is minimal impact and 10 is possible business closure, 22% of respondents reported a level of 10; nearly 15% reported a level of 9; and 15% reported a level of 8.

"With recent efforts to reopen the economy, we anticipate these numbers improving over the coming weeks," said Charles Wood, the vice president of the Chattanooga Chamber of Commerce. "In the meanwhile, we are continuing to support the business community through our #ChattanoogaToGo campaign, PPE (Paycheck Protection Program) support and longer term strategies for economic recovery."

Contact Dave Flessner at or at 7423-57-6340.