Consumer food costs rose 11.4% in August, a 43-year high. / Photography: Shutterstock
Inflation may have peaked, but restaurants continue to raise prices.
Prices at restaurants and food service operators rose 0.9% in August, the U.S. Bureau of Labor Statistics reported Tuesday. Prices rose 8% from a year ago as operators increased the fees charged to consumers to offset their own cost increases for wages and food.
Much of this acceleration is due to significantly higher prices in school lunch programs, where many states have ended free meals for students. Prices at schools and employee sites have increased 23.7% over the past year.
But full-service and limited-service restaurants continue to raise prices. Full-service restaurants raised prices 0.8% last month, higher than the 0.6% increase the previous month. Restricted-service restaurants raised prices 0.7%, down from the 0.8% they raised prices in July.
For the year as a whole, full-service restaurants increased menu prices by 9%. Restricted-service restaurants increased their fees by 7.2%.
The higher foodservice prices come as overall consumer food prices show few signs of slowing.
Food prices have risen 11.4% over the past 12 months, including 0.8% in August. This is the highest rate since 1979.
This is largely due to rising prices at grocery stores, which rose 0.7% in August and 13.5% over the past year. Consumers paid much higher prices for everything from breakfast cereals (23%) to eggs (40%).
The wide price increase gap between grocers and restaurants, 5.5%, is historically high and has helped restaurants maintain demand despite their own price increases higher than normal. Still, worries about inflation have led many restaurants to start looking to value. Domino’s this month started offering customers 20% off all menu items ordered through digital channels, for example.
Overall inflation rose 0.1% in August. But on an annual basis, the consumer price index slowed to 8.3% from 8.5% the previous month. Lower gasoline prices were responsible for much of this slowdown.
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