The National Restaurant Association today released its mid-year report and it shows a significant recovery is taking place throughout the industry, despite the lingering global pandemic.

The association projects food and beverage sales to total $789 billion in 2021, which is a nearly 20% increase over a devastating 2020 in which dining rooms were closed across the country and people were anxious to simply leave their homes.

Much of that recovery has come from easing restrictions. As of June 2021, 39 states and the District of Columbia had reopened to 100% indoor dining capacity; 11 states and Puerto Rico are open at varying capacities ranging from 50% to 80%, according to the association.

Though the positive trajectory is certainly worth acknowledging, the projection remains down by $110 billion from initial 2020 projections before COVID-19 took hold in the U.S. In February 2020, the National Restaurant Association estimated sales that year to reach a record $899 billion.

Such a disparity between then and now is a somber reminder that we have lost a significant number of restaurants throughout the past 18 months, and that we’re not quite out of the woods yet. To find a silver lining, however, it also indicates that we have much runway ahead for creative growth–a comeback story is in the works. 

That’s not to say it’ll be easy, particularly as the entire industry grapples with historic labor pressures. Despite a steady trend of job creation in the first half of the year, eating and drinking places are still nearly 1 million jobs, or 8%, below pre-pandemic employment levels and the restaurants and accommodations sector have one of the highest levels of unfilled job openings of any industry. Seventy-five percent of restaurant operators report that recruiting employees is their top challenge–the highest level ever recorded.


Labor challenges aren’t likely to wane anytime soon. The industry has thrown the kitchen sink at the employment issue, wooing workers with free iPhones, French fries, college courses and more. In fact, the industry’s wages grew by 10% in Q2, the highest increase in years, facilitated in part by a 4% increase in menu prices through June 2021.

Despite these efforts, the quit rate in the industry is historically high, with workers citing not just pay, but also COVID safety and harassment issues as their reasons for going elsewhere.

Still, there are reasons to remain optimistic. Most restaurants proved their agility in the past year and a half, sprinting to put new operational models into place. Businesses that invested in technology to support the material increase in off-premise demand were able to quickly yield a return on investment and are likely to find stickiness in that off-premise business even as dine-in returns.

Some chains that had never considered drive-thrus before have swiftly changed their tune and are attracting new customers accordingly. Other chains are adopting entirely new real estate models to cater to a digital consumer set changed by the pandemic. Digital consumers tend to spend more, so it’s hard to find a negative here.

Restaurants have also been forced to get creative and find efficiencies where they perhaps hadn’t before. Some added alcohol to-go or set up tables on sidewalks, while others trimmed menus or simply added QR codes to ease labor pressure.

Consumers have made it clear they like these changes and want them to remain. According to the association’s report, 52% of adults would like to see restaurants incorporate more technology to make ordering and payment easier, for example, while 84% favor allowing restaurants to set up tables outside permanently.

Of course, it’s still early and the COVID-19 delta variant has the potential to upend some of the industry’s recovery. In fact, six in 10 adults have changed their restaurant use due to the rise in the delta variant, the association notes.

But if we’ve learned anything throughout the past 18 months, it’s that the restaurant industry is nimble–perhaps nimbler than anyone predicted in February 2020. And although those February 2020 projections were significantly higher than today’s projections, the industry is inarguably stronger and wiser now because of what it’s been through.

“Faced with one of the most devastating and disruptive events of our lifetime, the restaurant industry has taken significant strides toward rebuilding over the first half of 2021,” Tom Bené, president and CEO of the National Restaurant Association, said in a statement. “Consumer expectations around dining out have changed, and the industry is continually adapting to not only meet, but exceed, these expectations. Restaurant operators, along with their partners throughout the supply and distribution chain, remain focused on providing diners with a safe and enjoyable experience, amid rising food and labor costs and challenges related to the pandemic. Given these factors, our outlook through the end of the year is one of cautious optimism.”