Restaurant businesses are growing despite some operational challenges, such as workforce development issues, demand for increased technology, and serving Millennials, according to new National Restaurant Association research.

The 2019 State of the Restaurant Industry Report, a comprehensive look at trends and sales projections for the industry, culled and analyzed economic data, along with responses to surveys sent to restaurant operators and consumers.

Hudson Riehle, Association Senior Vice President of Research & Knowledge, shared takeaways from the report, discussed how he expects business to perform throughout 2019:

Download the full report

How are restaurants doing, and what are some key trends you are seeing?
Operators generally are optimistic about business conditions, but they are still experiencing some competitive pressures, including rising labor costs and a tightening labor market, which makes recruiting and retention, especially for the back-of-the-house positions, tougher. In addition, they are navigating complex legislation ‑‑ and in some cases overregulation ‑‑ on the federal, state and local levels of government.

Is consumer demand affecting restaurant technology?
In general, Millennials and Gen Z customers want more technology when they dine out. Mostly, the demand is for online or app ordering, mobile payments and delivery management. Our research found that in the past year, 56 percent of Millennials placed takeout or delivery orders using a restaurant app. They also were more likely than older consumers to order from kiosks. They want easy access to convenience and accuracy.

How do industry sales look for 2019?
The Association projects total industry sales this year to reach $863 billion, and all signs indicate consumers are still upbeat about their finances. That should translate into more spending at restaurants. At the same time, USDA data reveals that the wholesale food prices on several commodities, including beef, eggs, poultry, and wheat, should remain down to flat, with gains in fruits and vegetables.

Is labor a challenge for the industry?
At the end of 2019, restaurants will employ more than 15 million people. However, more than one-third of all operators report they have job openings, especially in the back of the house. One of the reasons is the shrinking pool of young labor participating in the workforce. Across all segments of the industry, the majority of operators said hiring and retaining work staff is their single-greatest challenge this year and would devote more resources to it.