When kids perked up at the sight of fast food establishments, parents all around would shout, “We got food at home!” Well, in this age of inflation, this adage is less applicable as economists have found that eating out is now less expensive than cooking at home.
Grocery prices have seen an increase of at least 13%, with goods on the shelves costing families much more than it has in previous decades. While most restaurants have increased their prices as well, inflation has only driven up menu items by about 7.6%. The growing grocery store costs are attributed to supply chain difficulties and other factors such as the war in Ukraine and a lack of production. The bump in restaurant prices is primarily due to the cost of labor increasing. Still, it is now more reasonable for Americans to dine out.
“Consumers are seeing the price of groceries rise much more than the price of restaurants or fast-food establishments,” said Michigan State University food economist David Ortega.
Restaurants are not just benefitting from customers switching from home-cooked meals. Chain eateries such as Applebee’s are seeing a hike in customers turning away from expensive fine dining as they scurry to the 2 for $20 menu to save a buck.
While some aspects of life impacted by inflation, such as gas, have slowly begun to decrease in price again, food continues to rise at alarming rates. In fact, the increase in grocery store meals is the largest seen since 1979, with no sign of slowing down any time soon.
“Consumers are getting a break at the gas pump, but not at the grocery store,” said Greg McBride, chief financial analyst at Bankrate.com.
