New Data Confirms That Texas Restaurants Are Still in a Precarious Position, with Recovery Reversing for Many

Staff Attending Team Meeting In Empty Dining Room - Source Texas Restaurant Association
New Data Confirms That Texas Restaurants Are Still in a Precarious Position, with Recovery Reversing for Many

Skyrocketing costs, Delta concerns, and the threat of tax increases could further erode restaurants' 2021 gains.

New data released this week confirms that the restaurant industry’s recovery has reversed, putting businesses large and small in a precarious position heading into winter.

According to a survey of operators conducted by the National Restaurant Association from September 7-15, 2021, nationally:

  • A majority of fullservice and limited-service operators say business conditions are worse now than three months ago;
  • 78% of operators say their restaurant doesn’t have enough employees to support current customer demand;
  • Costs are up across the board—91% of operators are paying more for food; 84% have higher labor costs; and 63% are paying higher occupancy costs; and
  • Profitability remains down with 85% of operators reported smaller margins than before the pandemic.

State-level data confirms a similarly bleak picture in Texas, where:

  • 72% of operators say their restaurant currently does not have enough employees to support its existing customer demand;
  • 91% of operators say their restaurant experienced a decline in customer demand for indoor on-premises dining in recent weeks because of the Delta variant; and
  • 89% of Texas operators say their profit margin is lower than it was prior to the COVID-19 outbreak.

Adding to restaurants’ anxiety is the uncertainty coming from Washington, D.C., where lawmakers are considering several tax increases that would be devastating for small, midsize, and family-owned restaurants in particular. The National Restaurant Association sent a letter to Congress yesterday outlining the latest, troubling data and our concern that tax increases will further undermine restaurants’ hard-fought recovery effort.

“The Texas Restaurant Association joins our colleagues at the National level in urging Congress to help, not hurt, restaurants in this critical phase of the pandemic,” said Dr. Emily Williams Knight, Ed.D., President & CEO of the Texas Restaurant Association. “Our members have shown incredible grit, determination, and innovation, and they deserve every opportunity to rebuild their business so they can continue to serve their communities for years to come.”

Read more about the latest data and our industry’s letter to Congress here.