Is the recession killing the American culture of dining out? Recent numbers from the NPD Group research firm indicate that total restaurant industry traffic in the quarter ending in May fell 2.6% from the prior year, the steepest decline in consumer visits since 1981.
But a breakdown of the numbers reveals that many of us visit restaurants just as frequently; we're actually spending 2% more on our bills each time. The main source of the falloff is families with children, who are cutting back on dinners out -- both with and without the kids. Traffic at the least expensive table-service restaurants is down 4%, while fast-food chains suffered only a 2% drop.
And compared to our relationship with most other consumer industries, the American affair with dining is thriving. Visits and expenditures in clothing stores, another measure of American consumerism, endured estimated declines of 13% in foot traffic and 2.8% sales during the first quarter.
Considering that the American savings rate has shot up since last year, restaurants likely hold a unique power to slow down the larger cultural shift in our spending habits. “We still want a convenient meal," says NPD analyst Bonnie Riggs. "A lot of us don’t want to cook.” Having established a daily routine in the boom years, whether it’s a morning run to Starbucks or a quick lunch break at the deli, it’s difficult to abruptly return to the kitchen after a long absence. Moreover, alluring recession deals keep lowering the cost of this convenience. The result is that more of our paycheck may be flowing into the industry even as restaurants suffer a drop in traffic.
In the inflationary 1980s, says Riggs, restaurant operators drove customers away by trying to pass rising food prices on to their checks. But once the industry mastered the art of dealing, she says, we remained relatively committed to dining out, with traffic changing little even through three recessions.
Dining out isn't the only nonessential item that we're still spending money on. Hershey’s reported a 5.9% uptick in sales, with a price increase more than offsetting a decline in sales. Spending money on these edible experiences rather than on possessions may make us happier, which might also explain why movie sales are booming. These moments of bliss help fight off the economic misery that the recession has brought on.