Restaurant Industry Update
SUMMARY: Labor shortages recede. Business Travel returns and with it, Business Dining. Healthy Q1 Growth.
Restaurants labor shortages are easing. Hiring software company Harver says progress has been made in the battle for restaurant help, citing a 22.1% increase in quick-service restaurant candidate volume in Q4 2022 versus Q4 2021, this versus a 11.3% decrease in candidates in Q4 2021 versus Q4 2020. Separately, Technomic and the Bureau of Labor Statistics report US Foodservice Industry employment levels reached 2019 (pre-pandemic) levels in February, and numerous national chains have reported significant improvements in 2023 staffing efforts versus the preceding two years, in-turn yielding improvements in guest metrics dealing with staff performance and quality of patron experience. Canadian foodservice industry employment rose 10% year-over-year in February. (Nations Restaurant News, Statistics Canada)
Staffing improvements have come with a cost, however. Restaurant Labor costs are up in excess of 18% since 2019, according to the National Restaurant Association.
Business Travel steadily rebounded in 2022 helping achieve a near-full recovery of the Business Dining industry segment from sustained pandemic-lows the preceding two years, reports Technomic . By Q4 2022, business dining expenditures were 91% of the same quarter’s level in 2019, the final quarter prior to the pandemic’s start. Technomic’s Tindex foodservice industry gauge shows sales growth of 9% over prior year in the United States for February 2023, the last reported period. Enabling the strong early-quarter performance were a weak comparison month of prior-January (2022) when the omicron variant was peaking, and release of pent-up December 2022 demand due to winter storms, coinciding with well-timed mild weather in January of this year. Last available report of commercial foodservice sales in Canada shows 12.5% annual growth at the end of 2022. (Statistics Canada)
Q2 2023 Market Update
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