For the first time ever, U.S. Commerce Department data show that Americans are spending more on dining out than they are at the grocery store, Bloomberg News reported on Tuesday (April 14).
As you might expect, there’s more to that statistic than meets the eye. The Commerce Department data only counts sales at conventional grocery stores in that number, not grocery sales at stores such as Walmart, Target and Costco. Those are three of the Top 4 retailers in the U.S., and Walmart alone now accounts for about 20 percent of U.S. grocery sales, according to Trefis. That’s enough to make the Commerce numbers significantly understate actual grocery spending.
But that doesn’t change the fact that spending has surged at restaurants and bars over the past several months — an Alix Partners survey found late last year that 76 percent of respondents said they planned to dine out more or the same number of times in 2015 compared to 2014. That may signal a generational shift in Americans’ eating habits, with the baton being passed from baby boomers (born between 1946 and 1964) to millennials.
Morgan Stanley identified that younger cohort, now ages 18 to 35, as more willing to spend on “food away from home” in a November report. And the National Restaurant Association now advises members on its website that “Millennials view dining out as a social event (i.e. a chance to connect),” adding that millennials “tend to favor fast food, deli food and pizza restaurants over coffee shops, high-end dining and casual dining. Their diversity and interest in new things draw them to more ethnic restaurants too.”
Meanwhile, pollster Gallup has recently found that among 51- to 69-year-olds, the majority say they’re spending more on groceries now versus a year ago than say they’re spending less, by a whopping 45 percentage points. At the same time, 10 percent more of the boomers reported that they’re spending less on “dining out” than said they’re spending more compared to 12 months ago.