After a couple of years featuring dramatic highs and lows, foodservice industry performance seems to have leveled off in terms of overall sales and what operators may spend in the coming years.

The National Restaurant Association projects total industry sales will hit $997 billion in 2023, which represents a 1.1% increase in real terms from 2022. The NRA’s growth projections vary a little by segment but nothing too significant. At the low end of the spectrum are full-service restaurants with a 0.9% projected growth rate, while limited-service restaurants will see sales grow by 1.4%. (The catchall category labeled “all other foodservice establishments,” which includes lodging, grocery stories and managed services, among others, is expected to grow by 1.5%.)

In addition, operators will spend $297.4 billion in 2023, per the International Foodservice Manufacturers Association 2023 Forecast. This marks a 0.1% increase in real terms from 2022. Breaking down that $297.4 billion total, restaurants will account for $176.1 billion, on-site foodservice $79.0 billion and retail at $42.3 billion. Once again, performance will vary by segment. IFMA forecasts lodging will increase its spend by 3.1% in 2023, mostly due to the fact that this segment continues to recover from the pandemic. In contrast, midscale dining and fast-casual operators are expected to reduce their spend in real terms by 2.2% and 1.3%.

Labor will remain a significant challenge for the industry throughout the year. The overall tight U.S. labor market means operators continue to compete with other business segments for labor. That said, there appears to be some light at the end of the tunnel. The NRA projects industry employment will hit 15.5 million by the end of 2023. If this comes to fruition — meaning the industry adds the 500,000 jobs as the NRA expects — restaurant and foodservice employment levels will finally exceed its 2019 pre-pandemic level of 15.4 million.

Presuming the NRA’s crystal ball is correct, that will only be the beginning. Between 2023 and 2030, the foodservice industry is projected to add an average of roughly 150,000 jobs a year, with total staffing levels projected to reach 16.5 million by 2030, per the NRA’s 2023 State of the Industry report. As a healthy dose of realism, only 1 in 10 operators think recruiting and retaining employees will be easier in 2023 than it was in 2022.

Operators will continue to lean more heavily into technology to help deal with their labor challenges. In fact, 58% of operators say using tech and automation to alleviate labor shortages will become more common in their segment in 2023, per the NRA. Technology, though, is generally complementary to human labor and primarily intended to enhance rather than replace workers in the restaurant industry, the NRA points out.

The pandemic may continue to fade, but some of the so-called "pivots” operators implemented will remain. Expanded delivery services, outdoor dining options, to-go alcohol offerings, and investments in technology are the foundation of the industry’s “new normal,” per the NRA. At least 4 in 10 operators in each of the 3 limited-service segments — quick service, fast casual, and coffee and snack — believe the addition of drive-thru lanes will become more common in 2023.

And in another sign of an industry returning to its more mature ways, 47% of operators expect the competition to be more intense than last year, per the NRA.

To help hone their competitive edge in the coming year, 4 in 10 operators plan to make investments in equipment or technology to increase front- and back-of-the-house productivity, per the NRA. These investments are anticipated mostly in the order and payment space, rather than automated systems or robots that prepare and serve food.

“As the restaurant industry adapts to a new normal, operators’ ability to be flexible and diversify their operations is essential to thriving,” said Hudson Riehle, senior vice president of Research for the National Restaurant Association. “With profitability under pressure, operators are launching new business models within the industry, reengineering current concepts, and allocating more space to off-premises business in order to satisfy customers in 2023.”

The good news in all of this? Consumers still see value and want to use restaurants more. Along those lines, 84% of consumers say going out to a restaurant with family and friends is a better use of their leisure time than cooking and cleaning up, per the NRA. And that’s one data point on which the industry can grow.