Last updated on February 22nd, 2016 at 02:51 pm
The National Restaurant Association (NRA) projects that restaurants in 2016 will post sales of $782.7 billion and employ 14.4 million people in more than one million locations. The 2016 Restaurant Industry Forecast reveals that the U.S. restaurant industry will remain the nation’s second-largest, private-sector employer—providing career opportunities for one in 10 working Americans.
“Though the overall economy is trending in the right direction, the operating environment isn’t without challenges going into 2016,” said Hudson Riehle, SVP of research for the NRA. “With overall tightening in some labor markets, we’re seeing recruitment and retention making a comeback as a top challenge for restaurant operators.”
According to the NRA, top restaurant industry trends and challenges for 2016 include:
• Not all smooth sailing. Restaurant operators will face a number of headwinds in the 2016 business environment. From legislative and regulatory pressures and moderate economic growth, to labor cost increases and cyber-security, both new and old issues will challenge profit margins and muddle operating procedures.
• Labor pool is getting shallower. Recruitment and retention of employees will re-emerge as a top challenge for restaurant operators, as a tighter national labor market means greater competition with other industries for employees. Workforce demographics are shifting to include a greater proportion of older workers while the younger labor pool is shrinking.
• Moderate sales growth. The restaurant industry will see its seventh consecutive year of real sales growth in 2016. Substantial regional variations will continue, reflecting local business conditions. The long-term trend of quick-service sales growth outpacing table service sales growth also will maintain its momentum, along with strong growth of snack and nonalcoholic beverage bars.
• Technology growing pains. The availability of technology options is starting to move from novelty to expectation among many consumers. In the race to be tech-forward, new systems are popping up in more places as guests say they want to use them. However, two in five consumers say that technology makes restaurant visits and ordering more complicated, indicating that perhaps not all these new systems are as user-friendly as they could be. Restaurants will be focusing on closing that divide in the year ahead.
• Mobile payment gaining acceptance. Few technologies are advancing faster than payment platforms. Security and convenience are converging in mobile payment systems, with a number of wallet apps and devices entering the market. Although a majority of consumers remain on the fence about paying for meals via smartphone, a growing number say they would use—or are already using—that option when available, and the trend is expected to keep its trajectory through 2016.
