Consumers ramped up their restaurant spending in April

Consumers continued to ramp up their spending in restaurants in April, driven by rising vaccination numbers and the easing of restrictions in many parts of the country.

Eating and drinking places* registered total sales of $64.9 billion on a seasonally-adjusted basis in April, according to preliminary data from the U.S. Census Bureau. That represented the third strong sales increase in the last four months, with total monthly sales rising nearly $14 billion above the recent low registered in December 2020.

Unlike March which saw broad-based growth across most retail categories, consumer spending was more targeted in April. Overall retail sales remained essentially flat in April, with restaurants (+3.0%) and vehicle dealers (+2.9%) the only two major categories to register sizable gains. 

While the impact of stimulus checks will fade in the coming months, economic fundamentals remain conducive for continued consumer spending growth. Households on the aggregate are flush with excess savings accumulated during the pandemic, and the labor market continues to improve. 

Note: With the release of the April 2021 data, the Census Bureau incorporated its annual revisions, which impacted the historical monthly sales figures in the chart above. 

Despite the recent gains, eating and drinking place sales in April remained $1.3 billion – or 2% – below their pre-pandemic level in February 2020. As such, the industry’s total pandemic-induced sales losses continued to mount.

In total between March 2020 and April 2021, total restaurant and foodservice sales were down $290 billion from expected levels, according to Association estimates. This includes the sales shortfall at eating and drinking places, plus a sharp reduction in spending at foodservice operations in sectors such as lodging, arts/entertainment/recreation, education, healthcare and retail.

*Eating and drinking places are the primary component of the U.S. restaurant and foodservice industry, which prior to the coronavirus outbreak generated approximately 75 percent of total restaurant and foodservice sales.

Read more analysis and commentary from the Association's chief economist Bruce Grindy.