Don’t expect the U.S. restaurant industry to begin recovering at least until the second half of next year, market research company The NPD Group said on Monday.
Restaurant traffic has declined in each of the past five quarters, but the rate of decline is expected to slow in the first half of 2010, according to NPD. In the second half of 2010, restaurant traffic is projected to begin increasing, said the Chicago company.
“Historically, the restaurant industry neither leads the economy into or out of periods of economic downturns,” said Bonnie Riggs, NPD’s restaurant industry analyst. “This recession is generally believed to be more severe than those in recent history, and this time the industry not only realized traffic losses, consumer spending declined as well.”
High unemployment, low consumer confidence, tighter credit and lower grocery store prices are among the factors causing consumers to shy away from dining out.
“This is first time since NPD began tracking that the industry realized a fall off in dollars spent at restaurants,” said Riggs.
No segment of the restaurant industry has been left unscathed, including seafood concepts such as McCormick & Schmick’s.
According to NPD’s CREST®, third-quarter consumer spending at restaurants slipped 2 percent overall, and restaurant traffic fell 4 percent overall; restaurant traffic dropped 4 percent in the quick-service segment and 5 percent in the casual-dining segment.
The news isn’t all negative. According to NPD, consumers believe the economy is beginning to improve or, at the very least, won’t get any worse.
“Consumers have been hurt worse financially in this recession,” said Riggs. “It’s just going to take awhile before they feel comfortable spending again.”
