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National Restaurant Association's State of the Industry Report is here

The industry is projected to reach $863 billion in sales and employ 15.3 million, according to the annual report.
Photograph: Getty Images

The economy continues to expand, albeit at a moderate pace, and consumer sentiment remains upbeat. Their confidence, along with healthy household balance sheets that free up spending, means the restaurant industry is expected to register positive sales growth again in 2019. Restaurant industry sales are projected to reach $863 billion this year.

Measures of business sentiment are positive, too, which typically buoys confidence for additional hiring. The industry employs about 15.3 million people now. As long as the potential risks of higher interest rates and trade skirmishes remain in check, the expectation is that business conditions will stay positive in 2019.

These are the high-level views of the National Restaurant Association’s 2019 State of the Industry Report, nowavailable as a complimentary benefit for Association members (join today!) or for purchase by nonmembers for $325.  The report delivers the comprehensive outlook of the size and sales of the industry, workforce trends, the health of the various segments, and food, menu and technology trends for the coming year.

Consumers’ assessment of the national economy, 2010 to 2019

Consumer sentiment improved greatly in 2018 and is holding into 2019.

national household surveys

Source: National Restaurant Association, National Household Surveys, 2010-2019

Workforce trends

Recruiting and retaining employees continues to be a top challenge for many operators. Competition for employees is intense: 35% of restaurant operators indicate that they currently have job openings that are difficult to fill. Overall, finding employees for back-of-house positions is the toughest. For general back-of-house jobs, family- and casual-dining sectors are having an even harder time than quick service, fast casual and fine dining, but the quick-service and fast-casual sectors have the hardest time finding managers.

The prolonged economic expansion has led to a tighter labor market for businesses in many industries, but the restaurant industry faces a few unique challenges. Long-term projections call for a shrinking teen labor force in the years ahead, a concern considering how dependent the restaurant industry is on this age group. Older employees are becoming an increasingly important labor source: The number of adults age 55 or older working in the restaurant industry jumped 70% from 2007 to 2018—an increase of 400,000 people.

Food and menu trends

Consumers want healthy food options, along with local sourcing and foods that are responsibly grown, harvested and prepared. A majority of consumers say availability of these items factors directly into their choice of a restaurant. Operators are seeing it: Eight in 10 say their customers are paying more attention to the nutrition content of their food than they did two years ago. Diners care about health and they care about the environment. 

The Association’s State of the Industry report lists the top 20 culinary and restaurant concept trends and the top 25 menu trends, which is topped by cannabis-infused foods and beverages. For a deep dive into the 140 hottest menu trends, based on a survey of 650 American Culinary Federation chefs, also check out the 2019 What’s Hot Culinary Forecast at Restaurant.org/foodtrends.

Restaurant trends

Although on-premises traffic still represents the majority of business in the table service segment, the growing demand among consumers will make off-premises options important drivers across the industry in 2019. Successful operators will focus on the daypart that works best for their segment.

Restaurant operators across all segments will focus on building business among younger consumers in the years ahead. To attract these tech-savvy consumers, a majority of operators expect to devote more resources to both social media marketing and electronic marketing in 2019.

There’s no question that millennial customers are impacting the restaurant industry. In multiple examples, questions that draw a certain percentage of responses from all customer segments trend substantially higher for millennials. Examples:

Half of all consumers—including 67% of millennials—say the availability of delivery makes them more likely to choose one restaurant over another

Forty-three percent of adults say they are more likely to incorporate restaurant-prepared items—such as a main dish, side, or dessert— into their home-prepared meals than they were two years ago. Among millennials, this rises to 58%.

Fifty-five percent of consumers say they would order breakfast items more often if restaurants offered them throughout the day. Among millennials, this rises to 63%.

The 2019 State of the Industry Report is rich with preference breakouts by generation and segment.

Technology trends

Restaurant operators are planning to ramp up their investments in technology in 2019, with the most common focus being customer-facing, service-based technology, such as online or app ordering, reservations, mobile payment or delivery management.

While most consumers currently use some amount of technology in their restaurant experience, there’s an appetite for even more advancements. A majority of consumers say they would like to see technology focus on improving customer service, making ordering and payment easier and offering more convenient takeout and delivery options.

Emerging technologies that rate highest among consumers include service-enhancing items such as tablets at the table, self-service electronic kiosks and wearable technology for restaurant servers.

Again, members can download and nonmembers can buy the report at Restaurant.org/Outlook. The National Restaurant Association’s research is considered the most authoritative source for restaurant industry sales projections and trends.

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