Full-Service Restaurants NAICS 722511

Apr 14, 2025 - Food Tops Labor as Top Concern for Restaurants

• Food inflation has ousted labor costs as the top concern among restaurant operators, FSR reported in April, citing restaurant scheduling software publisher 7shifts’ 2025 Restaurant Labor Cost & Profitability survey. The survey of more than 500 restaurant professionals across industry segments revealed that food price inflation dominates restaurant concerns, with 52% of respondents ranking it as their primary challenge and 86% including it in their top three. Labor costs closely follow as the second most pressing issue, ranked first by 31% of operators and in the top three for 83% of restaurants. That’s a switch from previous years, which saw labor as the top issue, and food inflation as the second. The combination of rising food and labor costs is squeezing already-thin restaurant profit margins. Meanwhile, tariffs on imported seafood and vegetables threaten to disrupt supply chains and raise food costs even more.
• Driving on-premise traffic will be a higher priority for restaurant operators than capturing off-premise visits this year, according to the National Restaurant Association’s State of the Industry Report 2025. During the pandemic and its aftermath, restaurants, by necessity, focused on their take-out and delivery services. Now, according to the report, 81% of consumers say they would eat at full-service restaurants more frequently if they had more money to spend. Across segments, restaurants are prioritizing on-premise service with 90% of fine dining operators saying on-premise visits would be more important in 2025 than off-premise. Major brands – notably Starbucks and Subway – are focusing their efforts on improving the dine-in experience and make their eateries more appealing places to linger. QSR customers identified store cleanliness as one of the most important factors determining their visit, per the NRA survey.

• Wine lists are getting shorter as restaurants try to make them less intimidating and more welcoming to patrons, The International New York Times reports. More concise wine lists are easier for wine directors to manage and allow them the flexibility to make changes and impose their point of view. Fewer selections also make it easier for diners – who are ordering less wine these days – to digest because they’re not overwhelmed by options. Shorter lists can also encourage customers to try new things. "When you have a big list you're going to gravitate to something you know,” wine director Nikita Malhotra told The Times. By paring down their wine lists restaurants can do without dedicated sommeliers because servers can master shorter lists more easily. To get patrons to sample new wines, some restaurants offer quartinos, flasks containing about a third of a bottle at reasonable prices, the Times noted.
• Employment by full-service restaurants grew 0.9% in January compared to a year ago while average industry wages rose 5.2% over the same period to $20.40 per hour, according to the latest US Bureau of Labor Statistics data. Rising restaurant payrolls have been supported by rising consumer spending – up 2.7% in February year over year and 0.1% versus January, according to the Bureau of Economic Analysis. But that may be about to change as US consumer sentiment plummets in response to President Trump’s volatile trade war, which threatens to fuel inflation.