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Restaurant Prices Rise Amid Inflation, Labor Shortage

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Freshly cooked dish of tasty pasta with tomato sauce and parmesan cheese in the shape of a growing bar chart | Restaurant Prices Rise Amid Inflation, Labor Shortage | Featured

There’s something new on the menu for food outlets across the US: higher restaurant prices. Americans raring to go out and eat should prepare themselves for the same dining experience they used to enjoy before the pandemic.

However, they should also expect to pay more for the same items. 

RELATED: Is Inflation The New Market Boogeyman? Experts Weigh In

Restaurant Prices To Go Up As Food Prices Go Up

Many shop owners are saying that their restaurant prices are going up thanks to rising costs in food, packaging, and supplies. 

In addition, labor shortages are forcing them to pay more for staffing. “If we’re getting squeezed there are only two ways to handle it, either cut costs or raise prices, there are no alternatives really,” said Hakan Swahn.

Swahn is the owner of Midtown’s Aquavit, a Nordic cuisine outlet in New York. He said he’s spending about 15 percent more on supplies. Consequently, this meant customers’ checks average between 15 to 20 percent higher.

Meanwhile, even packaging costs are rising. Ciro Casella, co-owner of San Matteo Pizzeria on the Upper East Side, said that everything’s prices went sky high.

“Even pizza boxes, they raised (prices) like crazy. I used to pay $12.95 for a bundle. Now it went to $17.95,” he said. He added that delivery prices and food supplies went up.

Olive oil, Mozzarella cheese, and tomatoes all went upwards of around 30%. Casella said that if prices don’t go down in a few months, he’ll have to raise the menu prices.”

Inflation Woes

US Labor Department data reports that prices across all products jumped an average of 4.2% over the past 12 months.

This is the largest increase since 2008, and a number of issues are driving up the prices. Consequently, the pandemic slowed demand for outdoor dining, forcing many restaurant operators to close.

Now, with the economy opening up, the surge of diners wanting to eat out generated overwhelming demand. To stay afloat, many owners had to raise their restaurant prices. 

Alan Natkiel, the owner of Georgia’s Northside restaurant in New Hampshire, said his grocery bills are 25% higher than average.

He made the decision to announce his price increases on Facebook for transparency. This also included updates that brisket prices went up 185% for brisket, 70% for chicken breast, 100% for fryer oil, and 300% for glove prices.

“People see an increase in prices of meat at the grocery store, but, by and large, they don’t see oil prices, they don’t see glove prices and no one wants to hear [that] your burger is an extra dollar because gloves cost more money,” he said.

Labor Shortage

In addition, the lack of available workers to meet demand is making matters worse. Many blamed a severe labor shortage for the rise in restaurant prices.

As a result, this drove wage inflation that pushed salary rates higher. Craig Dunaway, president of the Ohio-based Penn Station East Coast Subs franchise, says that wage inflation is a crisis right now.

Penn Station in particular, which operates 300 locations in 15 states, is struggling to hire new workers. As a result, the chain raised prices effective May 1. 

Dunaway says the problem isn’t exclusive to Penn Station. “It’s not like we’re at a competitive disadvantage. Everybody’s experiencing it. Our suppliers are experiencing it, too. They also have fewer employees,” he noted.

Watch the Uneducated Economist as he discusses that restaurants could be going into crisis because of labor and supply shortages:

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Have you experienced dining out again? Also, did you come across higher restaurant prices when you went out to eat?

Tell us what you think about higher restaurant prices and their effect on your budget. Share your comments below.

10 Comments

10 Comments

  • Anonymous says:

    They will lose in the end, people will eat out less

  • Sandra Sharpe says:

    Because of the high price I will not be eating out much & there’s others is doing the same thing it’s not right, scent Biden took office everything has went through the roof for the American people,
    Biden and his Administration don’t care the Americans people, as long they get their pock full,it’s a crying shame of what, But. in the end when they meet their maker you’ll be wishing that they didn’t do us this way

  • CM says:

    The price of everything is going up because of purposefully inept fiscal policy. Inflation is a tax that drains real wealth from real people and leaves individuals in a month-to-month living situation. “You’ll own nothing and be happy” is coming your way soon.

  • DOUG FELTON says:

    I have several friends in the restaurant business. They have no choice but to raise prices due to insanely high food costs due to the current administration shutting down the country, leaving suppliers with all their overhead, excepting labor, and no way to deliver product. Now that the country has finally been opened up, there is no labor force for either suppliers or retail shops and restaurants because the idiots in Washington are giving practically everyone $600.00 per week unemployment. Do the math: $600 divided by 40 hours equals $15.00 per hour. Just what they have been trying to get approved for years. There is no way small businesses can operate at reasonable
    prices with labor costs that high and why would anyone go to work for $15/hr. when they can stay home, not commute, not work, and make the same thing! Complete insanity!

  • DRA says:

    Well said. The Democrats and their infinite stupidity will distroy this country. The only good liberal is a dead liberal. Prepare. War is coming!

  • BBA says:

    This is all very intentional. The Marxist Democrats want Americans to be unable to support themselves and rely on Big Government for everything. Inflation is a huge weapon for the Marxist and killing small business is a big part of the plan. Big corporations like McDonalds & Monsanto will be fine since they are globalist giants but the little corner diners and small farmers will suffer dearly from this. You can thank the propaganda press for a lot of this bs. Instead of asking the idiot Biden about hyper inflation they would rather ask him about his flavor of ice cream when they have the chance?!?

  • David Edwards says:

    Obinden is ruining the country from the inside out he has a lot of experience.So all that voted for him need not to complain it is your fault as well.It is just a shame that the other half of America has to deal with it.So that being told we have to help our Resturants Not the big box ones, the mom and pop ones.Remember to vote in 2024and maybe we can stop the Socialist.This is all from the Socialist play book and author Karl Marx

  • Kimberly Cay says:

    Didnt mibd $146 for 6 people to eat at red lobster. I had a BIG probkem with the request for 20% = $24 tip for a server already making $25/hr and had to be asked twice for napkins! I will pay the price if quality is there!

  • Rueben. says:

    As a business owner there is a fine line in trying to make up for lost profits or just saying it was what it was, and move on forward and keeping the same prices. I chose leave the prices as they are If I have to pay a higher price for an employee now well thats the governments fault for playing around with viruses and trying to weaponizing them eventually what will happen is that a percentage of us will just stop and close our doors thank you for the support USA government system thank you for only taking care of big business with the trillions you gave them. PPP what a JOKE this is for crooks, liars and big business o yea they are crooks and liars…

  • k says:

    I am food server my pay is 2.13 in Wyoming been on job for 8 years.i would like s pay raise. are food prices s go up all time. the cooks get raise. but severs get 2.13.wyoming does not pay wait staff any more. if you don’t makes tips your are to get 7.25 hour.but my company. does not.i work for the first few months when cov19.i was layed off I got 600 plus my reg unemployment. but by God I earned that. are company gave nothing out but the money I earn ed ya I liked a raise more then 2.13 hour. sure we short on staff. people wanted to stay home.got paid more .but people don’t want to get sick.now force us to get vaccined.all for 2.13 hour.

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