Foodservice Sales Will Edge Closer to $1 Trillion This Year

With projected sales of $898 billion this year, the restaurant industry continues to recover from the pandemic, says the National Restaurant Association’s 2022 State of the Industry Report.
Restaurant operators will devote more resources to technology solutions this year and should also consider adding the sustainable packaging options that customers want.

The foodservice industry will edge even closer to $1 trillion in sales and employ nearly 15 million people by the end of this year, according to the National Restaurant Association’s 2022 State of the Industry report.

The report measures the restaurant industry’s continued recovery and examines the status of current and emerging trends across key categories, including technology and off-premises business, operations, workforce, and food and menus.

Several key findings illustrate how the industry has continued to recover from the pandemic:

The foodservice industry is forecast to reach $898 billion in sales in 2022.
The industry workforce is projected to grow by 400,000 jobs, for total industry employment of 14.9 million by the end of 2022.
Despite these soaring numbers, more than half of restaurant operators said it would be a year or more before businesses conditions return to normal. Food, labor and occupancy costs are expected to remain elevated and continue to impact profit margins in 2022.
Ninety-six percent of operators experienced supply delays or shortages of key food or beverage items in 2021, and these challenges will likely continue in 2022.
Fifty-one percent of adults say they aren’t eating at restaurants as often as they would like, which is an increase of six percentage points from before the pandemic.

Technology, Takeout and Outdoor Dining
Technology helped restaurateurs navigate the challenges of the pandemic, the report states. A few years ago, restaurants couldn’t have managed the level of off-premises demand seen during the pandemic. More than 80% of operators say the use of technology in a restaurant provides a competitive advantage, and a good proportion of operators plan to ramp up investments in technology this year.

Many operators will devote their resources to online or app ordering, reservations, mobile payment, or delivery management, in addition to back-of-the-house technology. And a large number of consumers prefer the use of technology as long as it doesn’t get in the way of good food and service.

Meanwhile, nearly four in 10 consumers said the availability of outdoor seating would make them more likely to choose one restaurant over another similar one. Other operational takeaways include:

Fifty-four percent of adults say purchasing takeout or delivery food is essential to the way they live, including 72% of millennials and 66% of Gen Z adults.
Roughly half of U.S. restaurant operators think the availability of seating on a sidewalk, parking lot, or street will become more common within their segment this year.
Seventy percent of Gen Z adults (age 21+) and 62% of millennials say the option of including alcohol with a takeout or delivery order would make them more likely to choose one restaurant over another similar restaurant.

Staffing Remains a Challenge
Meanwhile, many restaurants remain severely understaffed, even though the restaurant and foodservice industry added back 1.7 million jobs during 2021 for an end-of-year total of 14.5 million employees. Seven in 10 operators across all major segments say their restaurant currently does not have enough employees to support customer demand, and most operators expect their labor challenges to continue through next year. Key figures on the restaurant workforce include:

Roughly 50% of restaurant operators in the fullservice, quickservice and fast-casual segments expect recruiting and retaining employees to be their top challenge in 2022.
Between 2023 and 2030, the industry is projected to add an average of 200,000 jobs each year, with total staffing levels reaching 16.5 million by 2030.
Seventy-five percent of operators said they plan to devote more resources to recruiting and retaining employees.

Streamlined Menus, More Plant-Based Options and Sustainable Packaging
Wellness has gained mindshare, with chefs ranking food believed to boost immunity and plant-based sandwiches highly in a list of Top 10 Trends for 2022. Sustainable, quality- and temperature-retaining packaging options also reign in 2022 as operators continue working to provide the best possible off-premises experience for customers.

Meanwhile, restaurant menu offerings remain scaled back compared with pre-pandemic levels due to supply delays, shortages and higher food costs. Key data points on food and beverage trends include:

Eighty-eight percent of adults (including 94% of millennials) say they would be likely to try ordering a wider variety of food items for takeout or delivery if the restaurant used packaging that helps the food maintain the same temperature, taste, and quality as when it’s served in the restaurant.
Six in 10 fullservice operators say their menu contains fewer offerings now than it did before the pandemic.
Fifty-seven percent of adults say they would likely participate in a meal subscription program if it was offered by one of their favorite restaurants. Eight in 10 millennials and Gen Z adults say they would use this option.

“Restaurants and their patrons have found themselves in a ‘new normal,’” said Hudson Riehle, senior vice president of the Research and Knowledge Group at the National Restaurant Association. “Given emergent technology, changing consumer behavior and dining preferences, and the extraordinary challenges of the last two years, the industry is unlikely to ever completely return to its pre-pandemic state. While recovery speed varies across the industry by segment, the constant innovation and sustained flexibility of restaurant operators are creating a new future for the restaurant industry. There will continue to be ample opportunities for growth in 2022 and beyond.”

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