New Jersey Business Restaurant Conditions Survey- August 2022
Restaurant Business Conditions Survey – August 2022
Restaurant operators expect business conditions to remain challenging
• Business conditions deteriorated in recent months, according to many restaurant operators. 54% of New Jersey operators say business conditions for their restaurant are worse now than they were 3 months ago. Only 14% say business conditions improved during the last 3 months.
• Looking forward, most New Jersey restaurant operators do not expect a return to normal business conditions any time soon. 10% of operators think it will be 7-12 months before business conditions return to normal for their restaurant, while 47% think it will be more than a year. An additional 20% of operators say business conditions will never return to normal for their restaurant.
Soaring costs across all parts of the business are creating challenges for restaurant operators
• A majority of New Jersey operators say their costs are higher now than they were before the pandemic:
- 84% of operators say their total food and beverages costs are higher than 2019
- 86% of operators say their total labor costs are higher than 2019
- 59% of operators say their total occupancy costs are higher than 2019
- 74% of operators say their total utility costs are higher than 2019
- 93% of operators say their other operating costs (supplies, G&A, etc.) are higher than 2019
• New Jersey restaurants took a number of actions in recent months as a result of higher
- 87% of restaurants increased menu prices, while 65% changed the food and beverage items that it offered on the menu
- 70% of restaurants reduced hours of operation on days that it is open, while 37% closed on days that it would normally be open
- 39% of operators say they postponed plans for expansion
- 48% of operators say they stopped operating at full capacity
- 36% of restaurants cut staffing levels, while 27% postponed plans for new hiring
- 25% of operators say they incorporated more technology into their restaurant
- 12% of operators say they eliminated third-party delivery
Profitability is down from pre-pandemic levels
• Despite the wide variety of mitigating actions taken to address higher costs, the vast majority of New Jersey restaurants are less profitable now than they were before the pandemic.
- 83% of New Jersey operators say their restaurant is less profitable now than it was in 2019 before the pandemic. Only 4% of operators say their restaurant is more profitable, while 13% say their profitability has remained about the same.
Majority of New Jersey restaurants are understaffed and actively seeking to fill positions
• Although the industry added back many of the jobs lost during the pandemic, a majority of New Jersey restaurants remain understaffed. 66% of operators say their restaurant currently does not have enough employees to support its existing customer demand.
• For most New Jersey restaurants, staffing is significantly below necessary levels. Among restaurants that are currently understaffed, 63% of operators say their restaurant is more than 10% below necessary staffing levels. 11% of operators are currently more than 20% below necessary staffing levels.
• 86% of New Jersey operators say their restaurant currently has job openings that are difficult to fill.
• 79% of New Jersey restaurant operators say they will likely hire additional employees during the next 6 months if there are qualified applicants available.
Source: National Restaurant Association, national survey of 4,200 restaurant operators conducted between July 14 and August