Restaurant Spending Reaches All-Time High As Americans Begin to Head Out Again
The pandemic made a significant impact on the restaurant industry as consumer behavior was altered and largely kept online. Now that restrictions have lifted, more Americans are heading out and splurging at restaurants and bars.
Sales exploded in May for the third consecutive month, pushing the total to an all-time high of $67.3 billion, up 1.8% from April, according to the U.S. Census Bureau. Before the pandemic, sales in January 2020 reached $66.3 billion before dropping 55% under $30 billion after statewide lockdowns, according to MarketWatch.
More Americans were able to save money throughout the pandemic with federal stimulus payments and unemployment benefits. The Restaurant Business pointed out that consumers have returned to a more normal level of spending; however, the pricing dynamic has changed and Americans are willing to spend more.
Restaurants have higher labor costs and traditionally raise prices more than grocery stores, according to Restaurant Business, and getting employees back has been tricky. MarketWatch found that if adjusted for inflation, restaurant sales are roughly 3% lower compared to the pre-pandemic height.
The shortage of restaurant workers is still hindering economic growth for many small businesses. Government labor statistics show that the restaurant industry is employing 1.48 million fewer workers now than before the pandemic.
But the good news is, despite higher prices and slower service, Americans are willing to come out and spend more money in restaurants and bars — even shelling out enough to overreach grocery store spending.
MarketWatch also reported that data from surveys show that consumers are planning to dine out more in the coming months.
“Sales at restaurants and bars continued to benefit from the warmer weather and looser business restrictions,” said lead U.S. economist Lydia Boussour of Oxford Economics, reports MarketWatch.
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