The National Restaurant Association expects industry sales to roughly double to $1.2 trillion by 2030. Much of the increase will coming from off premise meals, which will also change the definition of a restaurant. Growth of meal delivery, online ordering, virtual restaurants, subscription services and grab and go meals will all occur. Restaurants may struggle with third-party delivery services for customer loyalty.

The industry workforce will likely exceed 17 million by 2030, but the makeup of the labor force will change significantly as the number of teenagers shrinks by millions and the number of those 65 years and older remain employed by the industry.

Economic News This Week

  • The Institute for Supply Management’s Manufacturing Index came in at 48.1 in November, a decline of 0.2. This was the fourth consecutive month the index contracted. (Any reading greater than 50 indicates expansion while any number less than 50 indicates contraction.) The New Orders Index totaled 47.2, a decline of 1.9 points. Despite a 2.9-point increase, the Production Index stayed in contraction mode at 49.1. The Employment Index fell 1.1 percentage points for a reading of 46.6. The Order Backlog Index dropped 1.1 points for a reading of 43.0. Of the 18 manufacturing industries surveyed by the ISM, only 5 reported expanding in November.
  • The Institute for Supply Management’s Non-Manufacturing Index hit 53.9 in November. Despite the 0.8 decline from the previous month, November was the 118th consecutive month in which the index remained in growth mode. (Any reading greater than 50 shows expanding activity.) The Business Activity Index declined 5.4 points for a reading of 51.6. In contrast, the New Order Index hit 57.1, a 1.5-point increase and the Employment Index hot 55.5, an increase of 1.8 points. The Order Backlog Index was unchanged and remained in contraction mode at 48.5. Of the 17 non-manufacturing industries surveyed by the ISM, 12 reported growth in November including Accommodations and Foodservices.
  • Initial-jobless claims totaled 203,000, a decline of 10,000 for the week ending November 30. The 4-week moving average fell by 2,000 claims to a level of 217,750.
  • Private sector employment grew by 67,000 jobs in November, per data from payroll processing company ADP. Small companies, those with 1 to 49 employees, added 11,000 employees. Mid- size employers, organizations with 50 to 499 employees, added 29,000 employees. Large companies, those with 500 or more workers, added 27,000 more employees. ADP also reported that the leisure and hospitality sector, which includes restaurants, grew by 18,000 jobs.
  • Nonfarm payroll employment rose by 266,000 jobs in November, per the U.S. Bureau of Labor Statistics. The average monthly increase had been 180,000 new jobs a month so far in 2019. The unemployment rate, which is determined in a separate study, fell to 3.5 percent – the lowest it has been in 50 years. In the last 12 months average hourly earnings increased by 3.1 percent, per the report.
  • October construction spending fell 0.8 percent compared to September, per the U.S. Census Bureau. Despite the month to month decline, this represents a 1.1 percent increase compared to October 2018.
  • The University of Michigan Index of Consumer Sentiment hit a 7-month high in the preliminary December reading. The Index rose to 99.2 from 96.8 in November. The Current Conditions Index rose to 99.2 from 96.8 in November. The Expectations Index hit 88.9, which is up from 87.3 last month.

Foodservice News This Week

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