The government shutdown was not great for the restaurant industry.
The federal government released jobs and retail sales data on Tuesday—data that itself had been delayed by said shutdown—that show a restaurant industry facing a slowdown in sales and hiring.
In October, for instance, sales at restaurants and bars declined 0.4% compared with September.
Sales are still up 4.1% compared with a year ago, though that is only slightly higher than the 3.7% price growth. But even that is a clear slowdown, as sales year to date are up 5.5% compared with last year, according to data from the U.S. Census.
Restaurants followed those low sales by slowing hiring. Restaurants and bars added 5,600 jobs in November—though they’d added 46,000 the previous month, according to data Tuesday from the U.S. Bureau of Labor Statistics. The industry employs about 12.5 million workers. Restaurant industry jobs numbers can be volatile from one month to the next.
Combined, the numbers reveal an industry that was hit with sales challenges once the government shutdown hit, which is echoed in comments from various executives and operators in recent weeks.
The labor market as a whole has slowed in recent months. Employers added 64,000 jobs in November. That was higher than economists expected.
The unemployment rate, meanwhile, increased to 4.6%, its highest rate since 2021. The rate, a key psychological measure of the labor market, has risen for four consecutive months.
Much like the jobs numbers, average hourly earnings appear to be slowing, which is good for labor costs but not so good for consumer spending. Average hourly earnings rose 0.1% in November, though they are up 3.5% over the past year.
More recent inflation data are not yet available, but as of September, core inflation was up 3% year-over-year. Restaurant menu prices were up 3.7%.
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