Restaurant industry sees signs of light

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As a recruiting agency that specializes in the hospitality industry for 20 years, Patrice & Associates has lived through the good, the bad and the ugly. We’ve lived through 911, through gas lines, and through record unemployment. Through it all, there has always been a constant thread – the restaurant industry always bounces back. People still eat out! There may be more items on the $1 menu or the Happy Hour menu, but people still eat out. Independent resaurants have been struggling and the chains may have closed some locations and opened others, but America loves to eat out!

Nations Restaurant News reports today that our industry is definitely on the rise. Two recent surveys forecast a slightly sunnier picture for the year ahead among both consumers and franchise business leaders, providing a glimpse of clearer skies for the restaurant industry.

Last week, a key consumer barometer, The Conference Board’s Consumer Confidence Index, showed its second straight gain in two months, with the consumer outlook for the months ahead reaching a two-year high.

The Conference Board, a New York-based research group, said the index rose in December to 52.9, from 50.6 in November. The index is based on a survey of 5,000 U.S. households, and readings above 90 indicate a stable economy and above 100 indicate economic growth. Tracking consumer confidence is key for many restaurant operators, as consumer sentiment is tied so closely to consumer spending, which drives the engine of the restaurant industry.

Last month, Darden Restaurants, Inc. said it was beginning to see signs that consumers were becoming more confident about the economy and perhaps willing to spend a bit more. “We do think that sentiment has gotten a little bit better as we look at our business across a lot of different cuts, and I would suspect that a lot of that has to do with the abatement in job losses and a little bit less concern about job security,” Clarence Otis, Darden’s chief executive, said in a conference call with investors in December.

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