Unemployment still impacting restaurant visits
BakingBusiness.com, December 13, 2010
by Staff

CHICAGO — High unemployment continues to negatively impact restaurant traffic with traffic down 1% in the third calendar quarter of 2010, according to The NPD Group.

But there are signs pointing to positive restaurant traffic growth in coming months. NPD expects traffic to grow by 1% in the final quarter of 2010 and the first quarter of 2011.

“Some of the areas most affected by the recession have stopped declining or are starting to edge back up, like families with kids and non-deal visits,” said Bonnie Riggs, restaurant industry analyst at NPD. “These are positive signs that the industry is beginning to return to normalcy, but high unemployment and the loss of benefits for the long-term unemployed will keep the industry from full recovery.”

Unemployment is highest among young adults ages 18 to 34, consumers who historically have been some of the most frequent restaurant users. Since September 2008, per capita restaurant visits for adults ages 18 to 24 dropped to 215 from 236, while the number dropped to 235 from 256 for adults ages 25 to 34. Consumers over the age of 50 tend to be lighter restaurant users but during the recession they have been more likely to hold onto their jobs and thus maintain their visits to restaurants, NPD said.

Visits to quick-service restaurants were up by 1% in the third quarter while causal dining visits were down 2% and traffic to midscale restaurants was down 3%.

“In spite of the visit declines, U.S. consumers still made 67 billion visits to commercial and non-commercial restaurants over the past year, and the industry will continue to work hard to provide their customers with the best quality, value and convenience,” Ms. Riggs said. “In the end, there will be winners and losers who capitalize on the situation with innovative offerings that draw consumers out of their homes or away from the competitors.”