U.S. restaurant industry analysts are expecting a strong second half of the year, driven by a resurgent labor market and lower gas prices.
Despite increased labor costs and other economic challenges, the National Restaurant Association (NRA) has a positive outlook for summer restaurant sales, and anticipates that overall restaurant sales will remain resilient in the second half of 2026, projecting growth to strengthen to 4.8 percent.
“After a bumpy first half of 2026, economic conditions are projected to improve during the last six months of the year,” the organization said in an economic analysis. “Most notable is the expectation of lower gasoline prices, which spent nearly three months above USD 4 (EUR 3.45) [per gallon]. That should ease the pressure on household budgets, providing some support for restaurant traffic and broader consumer spending.”
In inflation-adjusted terms, however, restaurant sales are projected to increase 0.8 percent in 2026, compared to a 1.3 percent increase forecast in early 2026.
The resurgent U.S. labor market should also buoy growth in the second half, NRA said. Employers added more than a half-million jobs during the first six months of 2026 – a pace of payroll expansion not seen in nearly two years. Additionally, the U.S. economy will add more than 1 million net new jobs this year – a solid improvement from last year’s modest employment growth, NRA said.
“When employment is strong and wages are rising, consumer spending typically remains resilient, including discretionary categories such as restaurants,” NRA said.
At the same time, the NRA found that customer traffic levels remain uneven, which means much of the sales growth is driven by higher menu prices – a continued necessity due to higher costs across the restaurant operation.
Food and labor costs are the two most significant line items for a restaurant, each accounting for approximately 33 cents of every dollar in sales, NRA said.
“While their growth rates moderated somewhat during the first half of 2026, both remain significantly elevated compared to pre-pandemic levels,” the organization noted.
In fact, average wholesale food prices are up 35 percent, while hourly earnings of restaurant employees have jumped 41 percent since February 2020.
“At the same time, operators are also contending with sharply higher expenses for insurance, taxes, credit card swipe fees, and other inputs. With that as a backdrop, it’s not surprising that 33 percent of operators said their restaurant was not profitable during the first half of 2026,” NRA said.
In the second half of the year, food and labor costs are expected to remain elevated, putting additional pressure on margins. In response, restaurant operators will need to remain focused on improving efficiency and productivity across various aspects of their operations while identifying opportunities to manage costs, according to NRA.
Inflation, however, remains a complicating factor for restaurants. The Personal Consumption Expenditures (PCE) deflator inclined 4.1 percent on a year-over-year basis in May, the fastest pace of inflation since April 2023. Core PCE inflation, which excludes food and energy, edged higher from 3.3 percent to 3.4 percent, its highest reading since October 2023.
“Overall, inflation remains persistently elevated and is moving in an unfavorable direction … Policymakers have struck a more hawkish tone in recent communications, reflecting renewed concern about inflation,” NRA said.
Consumers will likely benefit from declining pump prices in the second half of the year, as well as continued growth in employment and wages. NRA forecasts real Gross Domestic Product (GDP) growth of 2.4 percent in 2026, above the 2.1 percent pace in 2025.
Positive recent restaurant performance was reflected in Houston, Texas, U.S.A.-based Sysco’s earnings for its fiscal fourth quarter ending 27 June, in which sales increased 4.7 percent; U.S. Foodservice volume rose 2.5 percent; and gross profit hiked up 3.7 percent to USD 4.1 billion (EUR 3.5 billion). On the other hand, sales were more moderate for Sysco’s full fiscal year 2026, rising 3.9 percent, while U.S. Foodservice volume increased 1.4 percent.
Similarly, Q2 fiscal 2026 net sales for distributor US Foods rose 4.5 percent to USD 10.5 billion (EUR 9 billion), while gross profit soared 8 percent to USD 1.9 billion (EUR 1.6 billion).
In the midst of a “challenging but stable industry environment,” US Foods Chair of the Board and CEO Dave Flitman said the company’s results are in line with its long-range plan, including 10 percent Adjusted EBITDA growth and 21 percent Adjusted Diluted EPS growth, driven by 29 basis points of margin expansion and 5 percent independent restaurant case growth.
Overall, restaurant visits grew this summer, per foot traffic firm Placer.ai. Visits to U.S. fast casual restaurants hiked up 4 percent for the week of 10 August and rose 3.2 percent for quick service restaurants – an impressive feat with higher fuel costs, tariffs, and other economic challenges.
Likewise, traffic to Orlando, Florida, U.S.A.-based Red Lobster soared after it brought back its Endless Shrimp promotion in April, peaking at a 24 percent increase year over year for the week of 27 April and holding double-digit gains into early June, per Placer.ai.
