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National Restaurant Association Releases 2021 Mid-Year State of the Restaurant Industry Update

8/31/2021

 
Positive trends improve industry outlook; uncertainty and waning consumer confidence could impact long-term rebuilding 

FOR IMMEDIATE RELEASE
Contact:
Vanessa Sink, Media Relations Director, National Restaurant Association 

Washington, D.C. (August 31, 2021) – Today, the National Restaurant Association released a mid-year supplement to the 2021 State of the Restaurant Industry Report, which illustrates the continued impact of the COVID-19 pandemic on the restaurant industry. The report provides an updated look at key indicators and trends influencing the industry’s recovery as of June/July 2021, including the current state of the economy, workforce, and food and beverage sales.

Key findings include: 
  • Food and beverage sales in the restaurant and foodservice industry are projected to total $789 billion in 2021, up 19.7% from 2020. 
  • Despite a steady trend of job creation in the first half of the year, eating and drinking places are still nearly 1 million jobs, or 8%, below pre-pandemic employment levels and the restaurants and accommodations sector have one of the highest levels of unfilled job openings of any industry. 
  • As of June 2021, 39 states and the District of Columbia had reopened to 100% indoor dining capacity; 11 states and Puerto Rico are open at varying capacities ranging from 50% to 80%. 
  • Six in 10 adults have changed their restaurant use due to the rise in the delta variant. 

“Faced with one of the most devastating and disruptive events of our lifetime, the restaurant industry has taken significant strides toward rebuilding over the first half of 2021,” said Tom Bené, President and CEO of the National Restaurant Association. “Consumer expectations around dining out have changed, and the industry is continually adapting to not only meet, but exceed, these expectations. Restaurant operators, along with their partners throughout the supply and distribution chain, remain focused on providing diners with a safe and enjoyable experience, amid rising food and labor costs and challenges related to the pandemic. Given these factors, our outlook through the end of the year is one of cautious optimism.” 

Labor and Food Costs Remain Top Challenges 
July marked the seventh consecutive month of staffing growth, translating to a net increase of 1.3 million jobs in the first half of 2021. Despite these increases, eating and drinking places remain nearly 1 million jobs or 8% below pre-pandemic employment levels. Operators also continue to grapple with higher input costs, with wholesale food prices increasing at their fastest rate in seven years.
  • 75% of restaurant operators reported that recruiting employees was their top challenge as of June 2021 – the highest level ever recorded. 
  • The full service segment was down 626,000 jobs, or 11% below pre-pandemic employment levels; the limited-service segment was down 175,000 jobs or 4% in the same period. 
  • Menu prices have increased nearly 4% through June 2021. 

Technology, Outdoor Dining, and Alcohol To-Go Are Here to Stay 
The pandemic catalyzed many changes in the restaurant industry including the rapid consumer adoption of technology for online ordering, electronic payment, and order pickup. Consumers want to see restaurants continue incorporating technology and are keen to continue using outdoor dining. In 31 jurisdictions, thanks to approved legislation, consumers will be able to continue ordering alcoholic beverages with their takeout. 
  • 52% of adults would like to see restaurants incorporate more technology to make ordering and payment easier. 
  • 84% of adults say they favor allowing restaurants to set up tables on sidewalks, parking lots or streets permanently. 
  • A majority of adults in states that allow alcoholic beverages with takeout and delivery orders would like to see it continue on a permanent basis. 

The Threat of Delta 
In the first half of 2021 industry trends were positive, but there is still a long road ahead. A National Restaurant Association survey, conducted Aug. 13-15, found that the delta variant of COVID-19 threatens to reverse the gains made in the first six months of the year. 
  • 6 in 10 adults changed their restaurant use due to the rise in the delta variant. 
  • 19% of adults said they completely stopped going out to restaurants. 
  • 37% of adults said they ordered delivery or takeout instead of dining in a restaurant. 
  • 32% of adults said that if asked to wear a mask and/or show proof of vaccination to dine indoors again, they would be less likely to dine in a restaurant. 

“The trends from the first half of the year are promising, but a lot of uncertainty remains in regard to the delta variant, consumer confidence, and ongoing labor challenges,” said Hudson Riehle, Senior Vice President of Research for the National Restaurant Association. “We expect restaurant pent-up demand will remain high in the coming months. However, in this state of flux, maintaining the availability of on-site dining with few capacity restrictions will be critical to keeping the overall sales momentum going forward, especially for full service operators.” 

The National Restaurant Association will continue to monitor the effect of COVID-19 on the industry in the coming months and plans a full State of the Restaurant Industry Report in early 2022.
 
Click here to download the 2021 State of the Restaurant Industry Mid-Year Update, sponsored by Sage Intacct. 

### 

About the National Restaurant Association 
​
Founded in 1919, the National Restaurant Association is the leading business association for the restaurant industry, which comprises 1 million restaurant and foodservice outlets and a workforce of 15.6 million employees. We represent the industry in Washington, D.C., and advocate on its behalf. We sponsor the industry's largest trade show (National Restaurant Association Show); leading food safety training and certification program (ServSafe); unique career-building high school program (the NRAEF's ProStart). For more information, visit Restaurant.org and find us on Twitter @WeRRestaurants, Facebook and YouTube. 

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