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This chart shows the retail sales at food service and drinking places as a percentage of sales made at food service and drinking places AND food and beverage stores. If nothing else, it shows that we are eating out more than we once were.
The theory here (and the reason for the chart) is that if times turn tough we'll be more likely to eat at home.
The shaded area represents the last economic contraction. The red lines show something that may or may not be indicative of a behavior change.
See Also:
The Definition of Discretionary
Source Data:
Food Service and Drinking Places Sales
Food and Beverage Store Sales
National Bureau of Economic Research, Inc.
6 comments:
Nice job! Yes, it is indicative of a behavior change and your graph aptly captures the extent.
The fast food restaurants shifted to a recessionary menu with dollar items, which is supporting their sales.
Mark, have you ever used the Rockefeller Institute data? They provide a quarterly sales tax estimate for states which is adjusted by legislative changes, and also for inflation using a non-CPI measure.
I think you'll find their historical XLS for sales taxes very interesting.
What are the percentages on the y-axis? It's imprtant to distinguish whether this is a shift within food budgets towards eating out more or just inflation making it more expensive to eat out as much as before.
maxedoutmama,
That spreadsheet is interesting. I'll have to look into that one.
rob dawg,
The percentage represents the total amount of retail sales (in dollars) spent eating in restaurants over the total amount of retail sales (in dollars) spent eating in general (eating in restaurants AND buying groceries). In other words, if people always ate out the percentage would be 100%. If they always ate at home the percentage would be 0%.
As an example, if I spent $100 in restaurants in a month and spent $200 in grocery stores in a month the percentage would be $100/($100+$200), or 33%. It is a percentage I can control simply by altering my behavior.
Inflation shouldn't come into play very much in this chart. If in a few years I find myself spending $200 in restaurants and $400 in grocery stores I'll still be spending 33% of my budget on eating out. Even if inflation was to grow faster in restaurants than in grocery stores, I could still alter my behavior (and the percentage) by simply eating out less.
Staggy, I can call you Staggy right? Do you see the point I was making? Groceries are highly elastic for substitution. Groceries are far less dependent upon energy and labor costs and such. Groceries are also the benificiary of an ag revolution that has gone largely unappreciated. Eat out also uses groceries but they are a very minor part of the total cost of the end product. Not least being the cost of the building location be it owned or rented. And don't forget min wage labor in a rising economy.
No doubt people will eat in more in the comming recession but I remain unmoved by the graph you present merely because I think the recession indicators are overwhelmed by other structural factors.
Rob Dawg,
Your point is certainly valid. It would not surprise me if the cost of eating out rose faster than the cost of eating in for the reasons you have specified. However, we are still in control of that. Nobody is forcing us to eat out.
Further, as seen in my followup chart (the next post), the overall amount of money spent on both eating in and eating out (per person) has remained rather "stagnant" (a slight pun based on my name ;)).
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