Not true. There are plenty of tourist attractions and restaurants open serving the sand-boxers.
There are many YouTube videos about life in Phuket every day and this guy (Don Kiko) regularly posts a helmet-cam video as he cruises around Patong on a scooter. This one is from yesterday, shot a night as he rides up Thaveewong Road and then around Sainamyen Road. Some restaurants are closed (including McD's) but many are open, with customers. It's quite dark north of Savoey Restaurant with everything closed there, but Sainamyen Road is quite busy all the way into the non-touristy heartlands of Patong.