The COVID-19 pandemic caused severe stress to the restaurant industry, which largely had to close to contain the infection’s spread. However, with the easing of restrictions and changes in business models by restaurants to meet changing customer needs, the industry made a strong comeback last year. Consumer spending at restaurants grew by 16% in 2021 versus the prior year, when restaurant spending declined by 12%. Spending was up 2% in 2021 versus 2019.
In January, inflation surged to a 40-year high due to high demand amid a severe supply chain crisis. And the Consumer Price Index is expected to hit fresh highs in February on the war between Ukraine and Russia, which has been driving up prices of crude oil and essential commodities. During inflationary periods, households and individuals are often forced to choose to spend on necessities over luxuries. This could lead to a decline in eating out at restaurants as people cut back on their discretionary spending.
