ALEXANDRIA, Va.—Forty-four percent of adults say they are not going out to restaurants as often as they would like, according to a survey by the National Restaurant Association.
The restaurant industry saw total sales of $88.3 billion on a seasonally adjusted basis in December, according to preliminary data from the U.S. Census Bureau. That was down 0.9% from November’s downward-revised volume of $89.2 billion.
Meanwhile, 36% of adults say they are not ordering takeout or delivery from restaurants as often as they would like. This was similar to readings in the association’s 2022 surveys.
Older adults are more likely to say they aren’t frequenting restaurants enough. Fifty-three percent of Gen Xers and 44% of baby boomers say they are not eating on premises at restaurants as often as they would like. Roughly 4 in 10 millennials and Gen Z adults reported similarly.
On the off-premises side, Gen Xers (40%) are the most likely to say they are not ordering takeout or delivery from restaurants as often as they would like.
Consumers’ pullback in spending was not specifically focused on restaurants. Consumer spending in non-restaurant retail sectors plunged 2.3% between October and December—more than double the 1.0% decline in eating and drinking place sales during the two-month period.
Retail sales were down a seasonally adjusted 1.1% in December, the sharpest decrease last year, and retail sales have slipped three of the past four months.
The Labor Department recently reported that inflation fell to 6.5% in December, down from its peak of 9.1% in June, but it is still well above the Federal Reserve’s target of 2%.
A recent Wall Street Journal article reports that these signs and others, including hiring and wage growth declines and existing home sale decreases, point to a slowing U.S. economy, as the Fed raises interest rates to offset inflation. The Fed raised interest rates seven times in 2022, totaling 4.25 percentage points, and the Fed has made it known that they will continue to raise rates in 2023.
Economists surveyed by The Wall Street Journal this month expect higher interest rates to tip the U.S. economy into a recession in the coming year.
“The lag impact of elevated inflation weighs heavily on U.S. households, it’s very clear that the median American consumer is still reeling from the loss of wages in inflation-adjusted terms,” Joseph Brusuelas, chief economist at RSM US LLP, told the Journal. “We’re moving towards what I would expect to be a mild recession in 2023.”
A survey by the Conference Board Top company showed CEOs are prepping for a global recession, albeit a short one, and they expect growth to return by late 2023 or the first half of 2024.
“Just about every region with the exception of China believes there’s going to be some kind of economic downturn,” Dana Peterson, the Conference Board’s chief economist, told the Journal. “Ninety-eight percent of CEOs in the U.S. think there is going to be a recession—but it’s going to be short and shallow.”