This summer, members of the Vertical IQ team are hitting the road for lots of fun adventures, and you’re invited — well, virtually at least! The Vertical IQ Summer Road Trip Blog Series will give you the 411 on all of the cool places our Vertical IQers are exploring … while also sharing ways to get the most out of Industry Intelligence. Here’s to making summer memories!
I’m happy to continue our summer blog series by sharing details of my family’s recent trip to New England. Even though I have lived in Texas for several decades now, I still love a trip up north to my home state of New Hampshire to see the lush scenery, visit family, enjoy the outdoors … and escape Texas’ triple-digit heat! My sister’s house on the Granite State’s coast certainly fits the bill for a perfect summer getaway.
We started our July visit in a traditional New England way — with a steamed lobster dinner. This was a special treat for me since getting fresh lobster in Texas can be challenging to say the least. Later, we ventured off to Jenness Beach in Rye, New Hampshire, to test the 50-degree ocean waters.
Next, we headed to beautiful, historic Portsmouth at the mouth of the Piscataqua River, which separates New Hampshire from Maine. Portsmouth is a picturesque seaport town, which attracts a lot of summer tourists. While there, we did some shopping in the historic Market Square area (taking advantage of the state’s 0% sales tax). We also enjoyed grazing our way through the town’s snacky options including visits to a great juice bar, a cozy coffee shop, and of course, an ice cream parlor!
Now let’s check out how the nation’s accommodation and food services sector looks at the macro level, as well as take a deep-dive to examine the details of the coffee shop and snack bar industry in Rockingham County, New Hampshire, home to Portsmouth.
A big picture look at the nation’s food services sector
The accommodation and food services sector includes businesses with NAICS codes starting with 72, as well as SIC codes beginning with 58 and 70. Looking at the U.S. Accommodation and Food Services Sector Profile on Vertical IQ, we see that there are 770,895 establishments in the U.S. that fall under this sector, preparing meals, snacks, and beverages for customers’ immediate consumption or providing short-term lodging for travelers and vacationers.
Employment and wage levels in the nation’s accommodation and food services sector are at all-time highs as many restaurants and lodging providers have staffed up for the busy summer travel months, according to recent data from the U.S. Bureau of Labor Statistics (BLS). Sector employment grew 1.3% in June compared to a year ago, and average wages for nonsupervisory employees at accommodation and food services businesses were $19.00 per hour in May, up 4% year over year, according to the BLS.
With regard to food services sales, the forecast is looking sunny. Restaurants (which would include sit-down and quick-serve restaurants, as well as niches like juice bars, coffee shops, and ice cream parlors) are forecast to top $1 trillion in 2024. This growth is driven by ongoing employment growth, technology advancements, and expanded use of restaurant apps, according to the National Restaurant Association’s (NRA’s) 2024 State of the Restaurant Industry Report.
The restaurant and food service industry is projected to add 200,000 jobs this year, bringing total industry employment to 15.7 million. Between 2024 and 2032, the industry is projected to add 150,000 jobs per year on average, with total staffing levels reaching 16.9 million by 2032, per NRA.
While this year, nearly eight in 10 restaurant operators predict their sales will increase (33%) or hold steady (45%) from 2023 levels, operators are less optimistic regarding profitability. In fact, only 27% are expecting to be more profitable this year than last. The reason? Average food costs have increased more than 20%, and average wages are up more than 30% since 2019, taking a bite out of profits, per the NRA report.
An up-close picture of Portsmouth’s coffee shop and snack bar industry
At Vertical IQ, we have you covered no matter what economic or Industry Intelligence you are looking for — from the macro down to the micro level. We provide not only the big picture of how a sector operates and is performing, but we also drill down to the industry level within our Industry Profiles, and even examine how a particular industry is performing at the local level within our Localized Industry Data.
In Localized Industry Data, you can take advantage of insightful content on the density, number of locations, and employment and wage trends for an industry within a specific geographic area. You’ll also find population, income, and wage trends for the MSA or county.
For instance, in Rockingham County, New Hampshire, where Portsmouth is located, our Localized Industry Data shows that there are 169 coffee shops and snack bars, an increase of 6.3% from the previous year. Census Bureau data shows that the population of the county changed by 0.8% from the previous year, which is higher than the national average of 0.6%. That means there are roughly 50.6 coffee shops and snack bars per 100,000 people in Rockingham County, which is more than double the U.S. average of 22.7 per 100,000. Of course it’s an area that attracts many non-resident tourists, so this ratio stands to reason.
In the last three years of reported data, the number of coffee shops and snack bars in Rockingham County has increased by 19, according to the Bureau of Labor Statistics. In fact, in just the past year alone, the number of locations changed by 6.3% from 159 in Q4 2022 to 169 in Q4 2023.
However, the overall local economy in this region shrank -2.2% last year, compared to the national average of +1.9%. Slower local economic growth may impact coffee shops’ and snack bars’ demand, but the tourist population may help offset this contraction.
On a more positive note, the most recent Bureau of Economic Analysis data reveals that per capita personal income changed 3.8% in recent years in Rockingham County, which is higher than the national rate of 1.6%. Stronger personal income typically means more discretionary income, which could increase demand for coffee shops and snack bars (such as the fabulous juice bar and ice cream shop I visited in Portsmouth!).
Getting a taste for New England
The food scene in Texas is nothing to turn your nose up at (barbecue, anyone?), but I will always be a sucker for the traditional seafood fare of my beloved New England. As the Localized Industry Data on coffee shops and snack bars from Vertical IQ suggests, I’m also not the only one who enjoys the lighter fare to be found in the Portsmouth area’s coffee shops and snack bars!
The remainder of our vacation was full of fun and more great food … as well as some quality relaxation. I had a blast at Bernie’s Beach Bar in Hampton, New Hampshire, taking in a concert by the Grammy Award-winning band Ozomotli. We also enjoyed some watersports and R n’ R at a lakeside cabin in Brownfield, Maine, 80 miles north of Portsmouth. To finish off our visit, we came back over the border to the White Mountain region of New Hampshire to explore Diana’s Baths, a popular hiking area featuring cascading waterfalls.
Before we knew it, our trip was over, and it was time to head back to Texas with some great memories … and maybe a few extra pounds from so many great meals. I’m already looking forward to my next trip to New Hampshire!
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