Insight Flash: Rising Inflation Impacts Restaurant Spend
As discretionary spending takes a hit amid rising inflation, we look at CE Transaction data to see how macroeconomic pressures are impacting restaurant spend at different customer income levels. For higher-income clientele (greater than $100,000), we see that the two lowest ticket categories – Family Dining and Limited-Service Restaurants – are showing the most spend growth in recent months. Meanwhile, some of the higher-priced categories – Casual Dining and Upscale Casual Dining – are weakening, suggesting that higher-income individuals continue to trade down in this challenging environment. In May, the gap in spend growth between those different subindustries neared 10%.
Among lower-income consumers (less than $80k), we see a significant slowdown in spend growth since February for those higher-priced subindustries: Family Dining, Casual Dining, and Upscale Dining. Growth for the most inexpensive category, Limited-Service Restaurants, has remained fairly stable. However, the gap in spend growth was less dramatic compared to the higher-income groups.
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