Consumption in Switzerland: Industries struggle in the wake of lockdowns

As the lockdown is lifted, the Swiss economy can look forward to higher consumer spending in 2021. But not all industries will see an increase in their bottom line. While cash registers may be ringing in the non-food and leisure industries, hospitality is lagging in the race to catch up on lost profits.

Consumption growth will be lower in 2021

As the catch-up effect is more modest and the loss was less severe, it is assumed that recovery for 2021 will not be as dynamic as last year. Furthermore, after the second lockdown, it is unlikely that all of the additional savings will be spent, if only because the savings rate is responding to more significant economic changes and particularly to shifts in the labor market. When households are worried about losing their employment income, they consume less.


We estimate that nearly 30% of the savings from both lockdowns will be kept for a rainy day over the medium to long term. Furthermore, not all industries will benefit equally from the expected catch-up in spending.

The non-food and leisure industries are catching up on consumer spending

The non-food industry in particular made up nicely for lost consumer spending in the months following the first lockdown. By direct comparison, the store closings in this segment were somewhat shorter and the measures were less restrictive. In the 2021 lockdown, non-food retail did suffer a drop in consumer spending of nearly CHF 230 million, but as consumers are eager to open their wallets again, the industry should catch up within three months.

The entertainment and sports industry is benefiting to a lesser extent from the recovery in consumer spending

To some degree, the entertainment and sports industry is seeing some consumer catch-up. However, it has not been as dramatic compared with non-food retail. After all, the potential to compensate for canceled sports activities and canceled trips to the movies, plays, and concerts is as limited as our calendars. Nothing much will change about that after the lockdown is over. The industry would need about 8 weeks of business as usual to make up for the losses in consumer spending seen in one lockdown-week.

The lockdown continues for the hospitality industry

Meanwhile, in the hospitality industry, revenues remain on the decline even after the 2020 lockdown. The potential for any catch-up effects is considered low in this segment. While restaurants and bars could be at capacity after the lockdown ends, it is unlikely that guest numbers will rise for the long term. Assuming that the catch-up in consumption is not significant, once establishments reopen it will take some 14 to weeks of regular operations to make up for just one week of lost consumer spending during the lockdown this year.


Hotels have the lowest chance of bouncing back to regular operations at present. At present, domestic tourists are an essential factor. However, if at least European travel is permitted this summer, hotels can expect that more Swiss tourists will prefer to spend their summer vacations in a foreign country. This would lessen the positive impact of domestic tourists in 2021. It seems that a return to regular operations will not be possible until international travel gets back to pre-crisis levels.

Consumer spending in food retail is booming

While many service providers suffered during the COVID-19 crisis, Swiss food retail enjoyed greater popularity. Competition from restaurants and bars was eliminated, and shopping tourism was impaired for weeks. Revenue growth in food retail reached record highs. Between the start of the pandemic and the end of 2020, average revenue growth was more than 12%. Reopening measures for restaurants and bars as well as cross-border travel will likely mean that revenues in food retail will get close to pre-crisis levels, bringing the current boom to an end.

The Swiss economy will suffer from the lockdown for a long time

The greatest long-term effects will be seen where restrictions were particularly severe and long lasting, such as the hotel sector, and where consumption cannot simply catch up (such as restaurants, bars, and leisure). While it would take about two weeks for non-food retail to make up for temporary losses in consumer spending from one week of lockdown in 2021, entertainment and sports are likely to need about eight weeks on average. As there are many substitutions for restaurant and bar visits, this sector has lower potential to make up for the drop in consumption. In regular operations, the lost consumption from one week of lockdown in 2021 should be made up for in some 14 weeks.