Whole Foods to debut a quick-shop format. Restaurant prices increased again in February. One restaurant is selling a bowl of soup for $1,863. These stories and more This Week in Foodservice.

If you were waiting for the U.S. Federal Reserve to lower interest rates, you might have to wait a little longer. That’s because the Consumer Price Index increased 0.4% in February, per the U.S. Bureau of Labor Statistics. This is 0.1% greater than January’s increase. And, over the past 12 months, the CPI has increased 3.2%. This marked the largest increase since September, per a Yahoo! Finance story.

The core CPI, which does not include more volatile food and gas prices, was up 0.4% in February compared to the previous month and 3.8% over the previous year. Both measures were higher than economist expectations of a 0.3% monthly increase and 3.7% annual gain.

The overall food index was unchanged in February, as was the food at home index. The food away from home index rose 0.1% over the month.The index for shelter and gasoline were the primary drivers of the February increase. Combined, these two indexes contributed more than 60% of the monthly increase, per the BLS. The energy index rose 2.3 percent over the month, as all of its component indexes increased.

Many economists feel that despite the unexpected increase in inflation, the U.S. Federal Reserve remains on track to lower interest rates later this year.

Foodservice News

• Whole Foods Market will roll out a quick-shop store format. Known as Whole Foods Market Daily Shop, these units will range in size from 7,000 to 14,000 square feet, meaning they will be significantly smaller than an average 40,000 square foot Whole Foods Market store. The smaller format will allow Whole Foods to target urban markets. Whole Foods Market Daily Shop will provide options for grab-and-go meals and snacks as well as some traditional grocery items. In addition, the location the company expects to open its first quick-shop format in Manhattan later this year and will offer Juice & Java, a venue for coffee, tea, fresh pressed juices, smoothies, sandwiches, soups and various desserts. The new format stores will not replace the traditional Whole Foods Market store format, per a company release. In 2023, Whole Foods Market added its 17th store in New York City at One Wall Street, thus expanding the chain’s urban real estate footprint. Whole Foods Market currently has more than 530 stores in the U.S., U.K. and Canada with more than 75 stores in the pipeline, per a company release.
• Fast-growing wages for hourly workers have some restaurant chains getting creative. Take, for example, El Pollo Loco. The chain projects wage inflation to fall between 12% and 14% this year, per a Restaurant Business story. As a result, the chain will raise prices in the mid- to high-single-digit range. But price increases will only go so far. That’s why the chain is exploring other options like menu updates and bringing in new equipment to streamline processes. Three-quarters of El Pollo Loco’s restaurants are in California, where a new state law is about to raise the minimum wage for fast-food workers to $20 per hour, a $4 hourly increase.
• Despite facing legal and fiscal challenges, FAT Brands continues to have an appetite for growth. The multiconcept operator will continue to grow both with its existing concepts and via acquisition, per a Nation’s Restaurant News story. The company is particularly interested in salad, sandwich and coffee concepts, which are currently not part of its portfolio. The story adds the company is converting underperforming Smokey Bones restaurants into Twin Peaks locations. FAT Brands posted a $26.2 million net loss for the fourth quarter ending December 31, 2023.
• Hoshizaki America broke ground on a new warehouse. The 120,000-square-foot space is “adjacent” to its current manufacturing facility in Peachtree City, Ga., and is expected to open in June of 2025, per a company release.
• Would you pay $1,863 for a bowl of soup? No, this is not the latest example of menu price inflation run amok. In this post-COVID world, consumers remain hungry for unique experiences. And The Drake Hotel in Oak Brook, Ill., hopes to satisfy that with the “$1,863 Bookbinder’s Soup Experience.” The Colonial Room, the hotel’s restaurant, prepared a special edition of its signature Bookbinder’s soup. The 1863 in the name is a nod to the year that Samuel Bookbinder first created the soup, per WBBM in Chicago. The soup includes Ossetra caviar, gold flakes and Louis XIII Cognac instead of the traditional dry sherry. And those who partake will learn how to prepare the soup via a cooking lesson from executive chef Ezequiel Dominguez.

Economic News

• The U.S. economy added 275,000 jobs in February, per data from the U.S. Bureau of Labor Statistics. This significantly exceeds economists projections of 198,000 gains for the month, per CNBC. Foodservice and drinking places added 42,000 positions, after changing little over the previous three months. Other segments posting job gains include healthcare, government, social assistance, and transportation and warehousing. The unemployment rate stands at 3.9%.
• Labor productivity increased 3.2% in the fourth quarter of 2023, the U.S. Bureau of Labor Statistics reported. Output increased 3.5% and hours worked increased 0.3%. Compared to the same period in 2022, business sector labor productivity increased 2.6%. Annual average productivity increased 1.3%.
• Job cuts announced by U.S. employers increased 3% in February compared to the previous month, per data from Challenger, Gray & Christmas Inc. This is also 9% greater than the job cuts announced in February 2023. So far this year, companies have announced plans to cut 166,945 jobs, down 7.6% from the first two months in 2023.
• Initial jobless claims totaled 217,000 for the week-ending March 2, 2024, per data from the U.S. Department of Labor. The number of claims did not change from the previous week. The 4-week moving average was 212,250, a decrease of 750 from the previous week.
• Private sector employment increased by 140,000 positions in February, per the ADP National Employment Report. This represents a 5.1% increase compared to the same period in 2023. February’s totals came in roughly 9,000 jobs less than what economists had forecasted, per a report from CNBC. The leisure and hospitality sector led the way by adding 41,000 positions. Construction was second, adding 28,000 positions. Medium-sized businesses(50 to 499 employees) added 69,000 positions, while large employers added 61,000 jobs and small businesses added 13,000 jobs.
• The number of job openings totaled 8.9 million on the last business day of January, the U.S. Bureau of Labor Statistics reported. This is flat when compared to the previous month. Over the month, the number of hires and total separations changed little at 5.7 million and 5.3 million, respectively. Overall, this data indicates the labor market remains on generally steady ground, as this Reuters report notes.